SGI NEWS

Time for Transparency

With data portals and closer links to citizens, many highly developed countries are trying to restore confidence in how governments and administrations work. By the end of January, EU countries must also make registers of beneficial ownership information publicly accessible – a litmus test for open democracy.

It has been more than ten years since Barack Obama kicked off a cultural shift on the day of his inauguration in January 2009 with the memorandum "Transparency and Open Government". Since then, having good governmental and administrative processes has increasingly meant having open governmental and administrative processes. Obama’s goal was to make the work of the entire public sector - spanning politics, government, administration, and the judiciary - more transparent, participatory, and cooperative thus decisively strengthening democracy as a whole and increasing the efficiency and effectiveness of government and administration.

The call for a more open democracy is closely intertwined with the development of the Internet and its multiple ways of providing information, using it, interacting with others and collaborating. This change was also fueled worldwide by the loss of political ability to act in the wake of the economic and financial crisis. The growing distrust of political systems and their protagonists and the declining turnout in elections were all sought to be counteracted with greater openness and proximity to citizens.

The U.S. continues to stand for data transparency

In the Bertelsmann Stiftung’s recently published Sustainable Governance Indicators (SGI) report for 2019, independent country experts assessed for the first time whether and to what extent the national governments of the highly developed OECD and EU countries have recognized the potential of open government for sustainable governance over the past ten years. In the ranking, the U.S. performs very well with 9 out of 10 possible points also under Donald Trump’s government. The authors of the report added: "In addition to data on the activities of government, the U.S. government publishes a vast amount of social, economic and other data. All major departments and agencies collect and publish important series of relevant data."

According to the experts, this data openness is also used and has an impact. In the US, for example, there has been a political debate about underemployment as opposed to unemployment and the importance of this indicator for labor market policy.

The provision of data on widely accessible platforms in an understandable form is essential to open up government and the administration to the population and the economy. This involves nothing less than establishing an ongoing dialogue with citizens and the civil society in order to obtain important momentum for future political and administrative decisions.

Multinational initiative boosts ties between governments and civil society

Two of the three countries leading the SGI open governance ranking score 10 out of 10 possible points: Norway and the United Kingdom, both founding members of the Open Government Partnership (OGP), a multinational initiative that has been pushing for greater transparency, citizen participation and administrative modernization since 2011. In the meantime, the organization has grown to 79 nations whose governments have committed themselves to action plans with concrete reform steps every two years in cooperation with civil society. The progress achieved is then assessed independently and publicly.

The examples of Hungary and Turkey indicate that this initiative goes far beyond lip service. Just one month after the Hungarian government presented its first Open Government Action Plan in 2013, its parliament amended its Freedom of Information Act, which had severely restricted access to data of public interest. In July 2015, four civil society organizations submitted a Letter of Concern to the OGP oversight body describing an increasingly hostile climate towards civil society organizations and deploring the criminalization of non-governmental organizations. The panel investigated the allegations, confirmed them and called on the Hungarian government to improve the conditions for cooperation with civil society. In December 2016, the Hungarian government declared its immediate resignation from the partnership.

The Turkish government, on the other hand, has repeatedly failed to provide action plans for more transparent and participatory government and administrative action, which is why the country was classified as an "inactive member" by the OGP supervisory body in September 2016 and was the first country ever to be completely excluded from the partnership one year later. Not surprisingly, Turkey and Hungary are also ranked at the bottom of the SGI’s open government ranking with only 4 and 3 out of 10 possible points, respectively.

Hesitant approach to transparency registers

Although many countries are now pursuing their own paths to steer towards a more open government, there is still much to be done. A key objective of open government and administrative practices, for example, is to prevent corruption, tax evasion and money laundering. With its 5th Money Laundering Directive, the EU has decided that all member states must make a so-called register of beneficial ownership information publicly accessible by 20 January 2020 at the latest. It is intended to expose those who profit from companies with complex structures and simplify research into cases like the Panama Papers.

The new German action plan was adopted in September 2019 within the framework of the Open Government Partnership. However, it did not make the national beneficial ownership register free for all citizens, a goal put forward by the German civil society Open Government Network. Although the country has had an accessible register of beneficial ownership information since 2017, its use is subject to a fee, which quickly makes searches costly. Although the German government thus meets the minimum requirements of the EU Money Laundering Directive, it does not meet the guidelines of the Open Government Partnership. In fact, only a handful of countries have implemented access to registers of beneficial ownership information for all citizens free of charge. These include Denmark and Great Britain, which also score highly in the SGI ranking for their commitment to open government. Even though only a few countries have moved forwards on the issue of establishing and accessing transparency registers, the OGP foresees an upswing in this area, as publicly accessible information on the economic beneficiaries of company networks has emerged as a key concern of the multinational initiative.