IMPLEMENTATION

There are a large number of government Commonwealth agencies which have some degree of autonomy from government; in 2004 there were 160 such agencies. Since 1996, the government has sought to ensure that these agencies act more directly to support government policy and remain accountable to ministers. A major report, the “Review of the Corporate Governance of Statutory Authorities and Office Holders,” also called the “Uhrig Review,” recommended in 2004 measures designed to strengthen the link between such agencies and the relevant minister. Recommendations made in the Uhrig Review are currently in the process of being implemented, and a range of agencies have been either abolished or amalgamated, or their functions absorbed by the relevant department.

The monitoring of executive agencies by the different ministries is significant because the individual minister (and not the cabinet as such) is held accountable for all the executive branches his/her ministry is responsible for. The same situation exists on the subnational level, but in the nine Austrian states, the head of the state government (Landeshauptmann/frau) has more power to monitor all the state executive branches than the federal chancellor has on the federal level.

Monitoring of executive agencies is based on the same procedures as with regard to line ministries.

Government agencies are subject to effective monitoring both through direct bureaucratic channels and by the activity of the free press. As a rule, executive agencies do not act against the directives of the ministries and there have been very few cases of agency officials taking action that could be seen as contrary to government policy.

The ministries effectively monitor the activities of all executive agencies, and the minister is responsible for compliance. Once again, the top-down structure of the Korean government allows for effective monitoring. Agencies generally have autonomy with respect to day-to-day operations, but even these can occasionally be the subject of top-down interventions.

Agencies report to the ministries and, in a strictly cconstitutional sense, are subordinate to the ministries and the CGO. In the daily practice of policy formulation and implementation, however, the relationship between ministries and agencies is less hierarchical and more built on dialogue and the sharing of expertise and information. Given that state of actual affairs, the notion of monitoring becomes an issue when the legally hierarchical pattern is supplemented by mutual dependencies.
The relationship between ministries and agencies has been subject to recent reforms. One reform objective has been to introduce more diversity among the agencies in terms of how closely they are monitored. The argument has been that agencies with only 10 civil servants and a limited budget do not need to be monitored as closely as the biggest agencies with a couple thousand civil servants and huge annual budgets. Another reform objective has been to reassess the structure of the agency system, including the so-called staff agencies whose main role is to provide the CGO with information and statistical analyses. In both cases, there is the general idea that ministries could, and should, steer agencies more closely than is presently the case.

Belgium has relatively few agencies that are funded and controlled by the government, but are also formally independent of the government. Agencies of this type include Child Focus, the Center for Equal Opportunities and Opposition to Racism, some official job placement agencies, social aid agencies (CPAS/OCMW), and so on. The monitoring of these agencies happens through several channels, three of which are the most important. First, a government delegate will generally sit on the board of these agencies. Second, each year, the agency will have to submit a report to the government or to the ministry responsible for its activities. This monitoring is extremely closely watched and effective. Third, most established parties obtain seats in the executive boards or councils of these agencies, and thereby also exercise some level of control. On the other hand, it is also true that some of the agencies that depend on regional governments (such as job placement agencies) have been criticized for their lack of efficiency. There is therefore a gap between legal monitoring (which effectively ensures that the agencies work in accordance with government policies) and bureaucratic efficiency.

To an increasing extent, high positions in government agencies are filled through the government’s civil service department (Alta Dirección Pública), based on candidates’ technical capacity and experience. Therefore, they do not depend on political appointments. Clear goals are identified by the directors of executive agencies and the corresponding ministries. Exhaustive evaluations of the system and of personnel choices are performed annually by the minister, the civil service and Segpres. In addition, the Ministry of Finance’s Budget Office monitors decentralized agencies and public enterprises from a budgetary perspective very tightly and effectively.

Executive agencies have certain autonomy, but given the formal norms of minister rule, the minister is ultimately responsible for what happens in the agencies. So it is in a minister’s political interest to monitor activities closely.
The work of the agencies is often based on specialized expertise; as long as an issue is not politicized, the minister will normally defer to the decisions made by the agencies.

Some agencies, such as the National Funding Agency for Technology and Innovation (Tekes), operating under the Ministry of Trade and Industry, have a high degree of autonomy and monitoring takes place on a general level only. To monitor some other agencies, a balanced scorecard system is used. All ministries use result management practices to monitor the agencies in their respective task area. In addition, a newly introduced system of political undersecretaries of state is designed to foster the monitoring activities of individual ministers.

Executive agencies lack the autonomy to pursue a course of action independent of the guidelines issued by the ministries that control them. Sometimes, the strong personality of agency heads leads to some conflicts. But, if and when these become known in public, the views of the minister or his key collaborators prevail.
At least the domain of social security has a department dedicated to monitor the executive agencies, namely the Social Services Authority (Inspection Générale de la Sécurité Sociale, IGSS). The Ministry of Finance also has a department to monitor the financial management of all governmental agencies, namely the Inspectorate General of Finance (Inspection générale des finances, IGF).

Until 2006, the Spanish administration did not have true executive agencies, although around 150 semiautonomous public bodies (formally known as organismos autónomos, or entidades públicas empresariales) existed. The regulation on state agencies for the improvement of the public services (Law 28/2006) allows the transformation of those administrative organs into genuine executive agencies (nine agencies have already been created in areas such as scientific research, migration, theatre and music, meteorology, development cooperation and air transport security). Thanks to this legislation, agencies are now able to function more flexibly, with increased administrative and financial autonomy and fewer bureaucratic constraints. The relationship with the government is maintained through programs planned throughout the year. The government exercises full control of these agencies by monitoring the agencies’ level of program execution. Agency funding depends on performance, so agencies have adequate incentive to implement programs. Furthermore, the recently created AEVAL (an executive agency itself, dealing with public policy evaluation and services quality) prepares an annual report for parliament that evaluates the agencies’ activities (first report was published in January 2009).
Despite these improvements, the majority of old executive bodies are not covered by this new regulation, and the process of transforming them into agencies was stopped in April 2010, following generalized cuts in public spending. Ministries can generally monitor the activities of their subordinate semiautonomous bodies to ensure they act in accordance with government policies. However, ministers sometimes have difficulties in effectively monitoring the largest and most important ones (such as the National Institute of Social Security in the case of the Ministry of Employment and Immigration, or the Taxation Agency in the case of the Ministry of Economy and Finance).

There are no semi-autonomous agencies in the U.S. administrative system. Independent regulatory commissions are deliberately set up by Congress outside the departmental system. Regular line agencies without departmental status such as the Environmental Protection Agency (EPA) are not subject to department supervision. Instead, they are accountable directly to the White House and are closely watched by White House Staff. The same is true for their rule-making authority. The best example of this situation under the Obama administration is the close cooperation of the White House and the EPA in classifying C02 as a pollutant to be regulated under the Clean Air Act. The White House explicitly endorsed the EPA’s “endangerment finding,” which set the regulation of greenhouse gases in motion. Large complex departments with heterogeneous units may display centrifugal tendencies among their units, a problem that the new Department of Homeland Security with heterogeneous units such as the customs service, immigration and naturalization service may be exposed to.

The procedure for the monitoring of operating agencies by the ministry in their task area is less formal than the parallel monitoring of line departments by the PCO, in part because operating agencies are generally not responsible for policy formulation. In addition, these agencies may have a degree of autonomy. Nevertheless, ministries do monitor the activities of most operating agencies. More and more, operating agencies look like typical government units, and indeed in some cases have been or are being reintegrated into their home departments.

There is not much delegation of responsibility away from the government in the Czech Republic. The agencies that exist take diverse organizational forms and are monitored in different ways. Most of them enjoy little autonomy, and are monitored relatively thoroughly. In many cases, both the government and the parliament are directly involved in the supervision.

Most of the time ministries have only two reliable instruments to push agencies in the direction they wish: the appointment of the agency head and the budget. But in many cases it can be observed that these two managerial tools are efficient only on the surface. A good example is the National Research Center (CNRS), where researchers have eluded all attempts to reform the agency. Despite the many criticisms, reforms, alternating of budget cuts and budget increases as instruments of punishment or reward, the agency remains fundamentally unchanged.

Executive agencies’ competences and responsibilities are explicitly contained in law, edicts, statutes and other regulations. Their activities are not only subject to legal supervision, but also to functional supervision. Functional supervision implies the review of the suitability of agency decisions, as well as of administrative instructions. This holds for the federal as well as the regional level. The ministries have not always made appropriate use of this oversight mechanism, however. The Audit Office has revealed deficiencies in the implementation of functional supervision by the line ministries.
A number of independent agencies, including the Federal Labor Office, the Federal Network Agency, the Bundesbank and others have deliberately been placed beyond the effective control of the federal government.

Japanese ministries are traditionally run by civil servants that stay within the same ministry for their whole career. Government agencies that belong to the functional area of a specific ministry are thus also directed by civil servants delegated from that ministry, who may also return to it after a number of years. From that perspective, control of executive agencies below the ministerial level can be quite effective. This mechanism is supported by budget allocation and person-to-person peer networks.

In 2001, so-called independent administrative agencies were established, following New Public Management recommendations to improve the execution of well-defined policy goals by handing them over to professionally managed quasi-governmental organizations. Such independent agencies are overseen by evaluation mechanisms similar to those discussed in the section on RIA, based on modified legislation. During the period under review, voices skeptical of this arrangement have gained ground, because the effective use of this independent-agency mechanism has been hindered to some extent by the network effects mentioned above, and because the administrators in charge frequently do not possess a managerial mindset, but rather originate from the civil service.

Monitoring executive agencies tends to vary from case to case. The process of monitoring tends to work better at the national level than at the subnational level, where the general process of accountability is less strongly developed. However, ministries do mostly have the means to monitor executive agencies at the national level.

Semi-autonomous executive agencies (also known as quasi-autonomous nongovernmental organizations, or quangos) are taking a more prominent role. These are often created to circumvent tight restrictions on public administration bodies. However, this can lead to difficulty in controlling their action. For instance, the opposition parties complained in parliament in June 2009 that they were unable to understand the precise function of the government-created Foundation for Mobile Communications. Overall, ex post monitoring of these agencies by outside bodies is minimal. Ministers of course have greater oversight power. However, members of the government appear to pay greater ex post attention to the official public administration (i.e., ministerial departments) than to the quango sector. What oversight exists is largely of an ex ante nature, most particularly through the political appointment of the senior figures in these executive agencies, with ministers often appointing individuals that are close to them on policy matters.

Since the early 1990s, most of the increasing number of government agencies were removed from direct departmental control under the “Next Steps” program. This move was designed to streamline administrative procedures and allow agencies to concentrate on their specific tasks. More than 75% of civil servants now work in agencies. The conscious separation of policy-making from implementation has fragmented ministries’ lines of control, which has from time to time created problems in monitoring agency actions in detail. Nevertheless, ministers remain accountable both to Parliament and to public opinion for the agencies under their jurisdiction. This means that even though ministers may be somewhat insulated from cases of poor administration, they can still face severe criticism and may be obliged to resign or force the resignation of senior agency figures if an agency is shown to be performing poorly, as happened with the head of the tax collection agency late in 2007 following the revelation that taxpayer data had been mislaid. The intensity of oversight will often depend on the caliber of the minister and his or her immediate advisers, but the incentives for ministers to exert some care are manifestly in place.

A major attempt at improving the transparency and the monitoring of executive agencies was initiated in 2006, but has not been completed yet. In a number of cases, the competencies of executive agencies and the monitoring mechanisms have remained ambiguous. In the period under review, the fiscal situation led to deep uncertainty over the funds available for the executive agencies. In the advent of the 2010 elections, some politically motivated disintegration was visible, with the heads of some agencies trying to please Fidesz in order to save their jobs.

The Netherlands has approximately 1,900 institutions/organizations, placed at arm’s length from government, charged with implementing legal tasks with public money. Some 600 of them are so-called autonomous administrative authorities (Zelfstandige Bestuursorganen, ZBO), such as the Public Broadcasting Foundation (NOS), the Commissariat for the Media, the National Forestry Service (Staatsbosbeheer), the Central Statistical Bureau (CBS), or the Royal Dutch Academy of Sciences (KNAW). According to the national ZBO register, in 2004, approximately €120 billion was spent by such bodies. In 2009, ministries could not give a total amount spent. Only Social Affairs and Public Health provided information on how much money autonomous administrative bodies falling under their jurisdiction generate in terms of premiums and levies. In their departmental annual reports, seven ministries do not provide performance information. In addition, there are the numerous public educational institutes, academic hospitals and museums, as well as dozens of oversight bodies and inspectorates, such as the Authority for Financial Markets and Competition or the Inspectorate for Education. In 2006 these bodies employed some 10,000 work years of civil servants. They inspect issues as manifold as youth institutes, health institutes, penitentiary institutes, environmental hazards, transport hazards, mobile phones, etcetera.

There are several shortcomings in terms of monitoring ZBO and other types of autonomous administrative authorities: since the voice of citizens is barely audible, the quality of services cannot be directly assessed through democratic processes; ministerial oversight is fairly haphazard and opportunistic, and is limited to political priorities, risks or actual crises. One example includes the case of a former minister of finance and later CEO of a private bank that went bankrupt, who in 2010 had to be cleared of professional misconduct in order for him to continue his present function as CEO in a national bank receiving bailout funds. Two oversight authorities, the Dutch National Bank and the Authority of Financial Markets and Competition, arrived at mutually contradictory verdicts. The minister of finance had to play the role of tiebreaker. However, there is also some evidence these authorities can be set up spontaneously to provide a form of horizontal accountability through peer review systems or client forums and potentially complement the hierarchical, more punitive oversight of ministries when it comes to facilitating genuine learning processes.

There is a large number of executive agencies in Poland. Agencies report to ministries, and ministries have special units responsible for monitoring the activities of agencies and auditing their finances. The effectiveness of monitoring has sometimes suffered from a lack of qualified personnel, the low quality of audits and the limited enforcement of anti-corruption measures.

Although the ministry organizational structure provides a hierarchical monitoring mechanism, the effectiveness of these mechanisms depends heavily on the personal experience and attitudes of the individual agents. The Internal Audit Coordination Board, affiliated with the Ministry of Finance, was established under Article 66 of the Public Financial Management and Control Law (Law No. 5018), and is tasked with ensuring cooperation with the audit units of public administrative bodies, and with making proposals for eliminating fraud or irregularities. Strategic planning and activity reports, if implemented properly, shall provide further mechanisms for monitoring.

By far the largest executive agency in the Irish system is the Health Services Executive (HSE). One of the rationales for establishing the HSE was to remove the public health system from political control or interference. For example, the location of hospitals and clinics should be decided according to medical criteria, and should not be subject to ministerial manipulation. The HSE is meant to have autonomy from the Department of Health, which now retains a relatively small staff to monitor policy. Nonetheless, the minister for health and children negotiates and accepts the health-care funding estimates for the government each year, and reports to the government and the Public Accounts Committee about how this money being managed throughout the year. The department works closely with the HSE on all these issues, but ultimately it is the department and the minister which reports to the Department of Finance.
In other areas, the autonomy of executive agencies has yielded mixed results, and the monitoring of these agencies is probably not sufficiently close to ensure that government policy is being implemented efficiently.
The Office of the Comptroller and Auditor General (OCAG) is responsible for auditing and reporting on the accounts of public bodies, ensuring that funds are applied for the purposes intended, and evaluating the effectiveness of operations. The latest Annual Report (for 2008, published in September 2009) contains 42 chapters and deals with the management of selected public sector programs, schemes and projects. In addition, the office has issued special reports. The reports of the OCAG are discussed by the Dáil (lower house) Public Accounts Committee.
Of particular relevance to the present item is a report by the OCAG on the state Training and Education Agency (FÁS) published in 2010. This highlighted serious shortcomings and inadequacies in the running of this agency, which is the second largest executive agency in the country.
The OCAG does not regularly monitor all executive agencies. It seems to select those where it knows or suspects that problems have arisen. Its mission statement says it “selects issues for examination which are important in the context of the management of public funds.”
In summary, a system of monitoring executive agencies is in place, but recent high-profile cases seem to show that this system all too often discovers failings and shortcomings after they have occurred.

Under the Fico government, the politicization of executive agencies increased. The government reduced the autonomy of the independent regulatory agencies responsible for setting the politically sensitive prices of gas, electricity, telecommunication, post services or public transport and filled leading positions in executive agencies with political followers. In a number of cases, political and personal ties prevented the sanctioning of misconduct.

Switzerland’s central administration is very small. This does not prevent bureaucratic drift (cf. Varone 2007), but in all likelihood the opportunities for such drift are much smaller than in huge administrations. Furthermore, Switzerland is no unitary federalism. Rather, it resembles the federalism of the United States. This implies much power for the cantons, while the federal state has a subsidiary role. Article 3 of the constitution states: “The Cantons are sovereign insofar as their sovereignty is not limited by the federal constitution; they shall exercise all rights which are not transferred to the confederation.” In those case which the federal state has tasks and powers – such as social insurance, environmental protection or zoning, for example – implementation is carried out by the cantonal and sometimes municipal administrations. These have considerable leeway in their work, and hence federal guidelines are very frequently implemented with substantial variations between cantons. Zoning policy has offered examples in which the same federal regulation has led to opposite outcomes in different cantons (Kissling-Näf & Wälti 2007; Linder 1988).
Much implementation is also carried out though the corporatist channel, by interest organizations that also have some leeway in interpreting policy.

Greece is a unitary state, and does not encounter the problems of monitoring executive agencies that appear in some federal states. Greek ministries each oversee a substantial number of semiautonomous executive agencies.
However, the performance of many executive agencies is poor, and a number continue to exist without exercising any effective function (i.e., they are moribund). Regulatory performance is often inadequate.
Ministers appoint the chief executive officers and administrative boards of most agencies attached to the ministry. In fact, ministers control most functions and activities of agencies falling within their task area so closely that, in practice, bureaucratic drift is not the most dangerous problem. Rather, the tight, less-than-transparent control of agencies by ministers, even at the expense of the agency’s sustainability, is a concern. For instance, an agency may be “instructed” to hire excess personnel or to channel its financial assets (e.g., savings) toward this or that financial institution. This type of mismanagement allows the minister in charge to engage in patronage and service sectoral interests by selectively administering favors through the agencies monitored by his or her ministry.

Autonomous executive agencies are not very common in Italian ministries. In the cases of those that do exist, monitoring of their activities by the ministries is not very effective or systematic. There are some exceptions: For example, the monitoring of the tax agency (Agenzia delle Entrate) by the Finance Ministry is effective.

Monitoring of agencies by ministries is quite weak. In the past, agencies have often spent more money than allotted to them in the government budget. The ministries themselves have in some cases engaged in the same practice of spending taxpayers’ money in excess of budget allocations. The problem is exacerbated by the fact that, due to capacity constraints and other reasons, the National Audit Office (Ríkisendurskoðun) has been able to monitor only a small fraction of the agencies under its jurisdiction. In the years between 2000 and 2007, the office audited only 44 out of 993 government agencies, or just 4.4% of the total, a very low percentage. In 2009, the first full year after the economic collapse and the fall of the big banks, almost half the effort of the office’s staff (43%) was devoted to financial auditing more or less connected to the collapse and its consequences.