Successful decentralization, “hanging” public administration reform and unconstitutional crisis – experts continued discussion of reforms

Reform of decentralization and administrative-territorial organization

Anatoliy Tkachuk, Science and Development Director of the Civil Society Institute, noted that Ukraine has now turned the first stage of reform – districts and new territorial communities cover the whole country. Now we can move on to the stage of regional development – this, according to the speaker, is the leading task for the executive and the president.

“It should be accepted as a fact: if the reform is prepared in sad times and comprehensively, it can be implemented during the window of opportunity. If the reform is well prepared, if it is implemented and yields positive results, another team that has democratically replaced the previous one can continue it. The reform has shown that reforms can be made in Ukraine, starting on a voluntary basis and ending administratively, as has been the case in some European countries. That is, Ukraine is Europe, and that’s for sure, “said Anatoliy Tkachuk.

Ihor Koliushko, Head of the Board, Center for Political and Legal Reforms, noted that overall reform is moving well despite the political vicissitudes, and focused on zoning. Currently, 136 districts have been formed with an optimal 125-129 (according to experts). Therefore, not all of them meet the established criteria: some have too few inhabitants, others – too many. The district reform phase needs to be completed.

To do this, the president must sign yesterday’s law “3651-d”, which provides a transitional period of reform, and parliament – to pass a new law on local state administrations. These two laws will make it possible to launch a new work of administrations in new areas. At the same time, it is necessary to adopt a law on administrative-territorial organization, which will establish rules according to which it is possible to further modernize districts and correct mistakes. Finally, to amend the Constitution regarding local self-government and territorial organization of power.

“There is still no bill to amend the constitution, and this is worrying. The political situation is changing, and today many have doubts whether the current parliament has the potential to pass such a bill, “said the expert.

Ihor Koliushko also criticized the Constitutional Court’s submission on the unconstitutionality of the decision to form districts. According to the speaker, there is no threat of canceling the reform in this way.

Vitaliy Bezghin, MP, Head of the Parliament Subcommittee on the Administrative-Territorial System of the Parliament Committee on State Building, Local Governance, Regional and Urban Development, noted that the Reform Roadmap announced at the Forum last year has been implemented. In his opinion, the decentralization reform is the most successful in the country for the last 6 years. This was possible in particular due to the executive-parliamentary symbiosis of youth and experience, as well as the symbiosis of the expert community.

The speaker expressed hope that despite the quarantine, the Council will be able to pass the first reading of the bill №4298 “On local state administrations” (amendments) by the end of 2020, and the second in January 2021. He added that the issue of amending the Constitution is painful, but they are necessary: ​​”Without cementing the reform by amending the Constitution, it will always be under threat from its opponents.” According to the speaker, there is a potential for their adoption in the parliament: the already mentioned law №3651-d, adopted by a majority of 301 votes, speaks for itself.

Oleksandr Slobozhan, Executive Director of Association of Ukrainian Cities, stressed that 95% of stakeholders in the reform are municipalities and communities. First of all, they need three things: dialogue as a guarantee of trust, budget, people.

The dialogue has not taken place so far, many questions have been collected both on the reform and on the weekend quarantine. According to the speaker, budget decentralization did not take place either. Communities have budget deficits and zero development budgets. Budget decentralization should be continued by amending the Tax and Budget Codes. We are talking about improving the efficiency of local taxes and fees, the exchange of information between communities and fiscal authorities, the revision of benefits. The third point is that a law on service in local self-government bodies is needed, as personnel are needed to transfer new powers.

Vyacheslav Nehoda, Deputy Minister of Development of Communities and Territories of Ukraine, stressed that the law  3651-d was adopted by a majority and the elections held on a new territorial basis are the foundation for further decentralization.

He noted that decentralization has types: administrative, budgetary, sectoral. “We understood that decentralization can be carried out only by creating a territorial basis. We did it all together. “The speaker added that the government’s decision to approve territorial communities was very difficult, noting that members of the government and Prime Minister Denys Shmygal had assumed great political and legal responsibility: “Without this, there would be no new districts and we would not be able to move forward”.

Mr. Nehoda summed up that according to the results of the study, the reform continues to be supported by the people of Ukraine (mostly among other reforms). As for the next steps, the government has to make a number of decisions by the end of the year in order to switch to the new system from January 1.

Tobias Thyberg, Ambassador of Sweden to Ukraine, noted the importance of the consistent changes that have been made. “It is important to draw optimism from what has already been achieved.” Delegation of powers between the central and regional levels and independence of administrations are important for the successful completion of the reform at the local level, as well as the adoption of the laws mentioned by the speakers. The speaker added that transparency of implementation of changes with the involvement of experts, national and regional figures, representatives of civil society is important. Solutions are not perfect, but they are better than no solution at all.

The participants of the discussion discussed the topical issue of the State Fund for Regional Development.

Vitaliy Bezghin noted that the Foundation is one of the leading institutions, it is transparent, competitive and should stimulate the development of regions and local self-government. According to him, this is a common vision of parliamentarians, the government and the relevant ministry. “What is a little worrying after the first reading of the budget is that it was actually reduced compared to the moment of registration. Edits are directed in this regard. It should be an indicator that will not only allow the completion of transition projects, but also allow the creation of development projects.

Speakers criticized the social economic development subvention as detrimental to community budgets and strategies. In particular, Oleksandr Slobozhan said: “I draw the attention of our foreign partners to such a shameful phenomenon as a subvention for socio-economic development.  Anatoliy Tkachuk added that “social economy” is “evil”, and the State Fund for Regional Development (SFRD) should be modernized and strengthened. Vyacheslav Nehoda noted that 2021 is very important, as more than 700 communities will start from scratch. Therefore, it is worth supporting, at least, the formation of a network of Administrative Service Centre`s (ASC), and this would be useful for the SFRD. Tobias Thyberg noted that the Fund needs to be funded: “If there are not enough funds for development projects, local governments will have the power only in words. There should also be a transparent and fair funding mechanism for this Fund. ”

The issues of supervision and control over the activities of local self-government bodies were also discussed.

Tobias Thyberg noted that there is no universal mechanism, the best practices are suitable for a particular country. “Any method chosen by Ukraine must comply with the fundamental documents of Europe, in particular the Resolution on Local Self-Government, and adhere to the principles enshrined in it.”

Oleksandr Slobozhan said that the compromise option for local and central authorities is reflected in the draft law “On local state administrations.”

On the example of the conflict between the government and local self-government during the pandemic, Anatoliy Tkachuk noted: “It is better to do liberal supervision today than to get under strict control tomorrow.” According to him, supervision should be implemented and the policy of cohesion envisaged by the “State Strategy for Regional Development for 2021-2027” should be implemented.

Vyacheslav Nehoda emphasized that it is not a question of supervising local self-government bodies, but of the legality of their decisions. A clear mechanism is needed, and the speaker believes that decentralized local self-government should stimulate its development and implementation of supervision, as it is interested in making legal decisions. The speaker summed up that according to the results of the survey, 87% of Ukrainians believe that such supervision is necessary.

“Decentralization gives, on the one hand, the opportunity for citizens to take responsibility for their lives into their own hands. But where local princes, almost feudal clans, were formed, the state must protect the citizen. The tool for this is the supervision of the legality of local self-government acts. The next stage in the development of local self-government should be the strengthening of the instruments of democratic participation of citizens, “Ihor Koliushko summed up.

Moderator Taras Sluchyk, European Union Anti-Corruption Initiative (EUACI) municipal component consultant, summed up the discussion. Decentralization reform is one of the most successful reforms in Ukraine with tangible results for citizens. Second, the State Fund for Rural Development should be a tool that helps community development. It must be transparent and – key – funded. Third, state oversight should help local governments be confident in the legitimacy of decisions. It is now important to continue to build trust between local and state authorities, and to implement the tradition of broad citizen involvement in decision-making at the next stage of the reform.

Public administration reform

The moderator of the discussion, independent expert Serhiy Soroka, said at the beginning of the discussion that public administration reform had slowed down recently and had taken steps back on certain issues. For example, they have returned to the practice of political dismissals, the law “On Administrative Procedure”, which is important for reform, has been “hanging” in the parliament for 10 years and is being considered for the third time, legislators have forgotten the law “On Public Consultations” and so on.

Oleksandr Kornienko, MP, Head of the Parliament Subcommittee on the Organization of State Power, Civil Service, Service in Local Self-Government Bodies, State Symbols and Awards of the Parliament Rada Committee on State Building, Local Governance, Regional and Urban Development, said that the slowdown in the main tracks of the Civil Service Reform Strategy was due in part to quarantine. He noted that the reform of the civil service requires the inclusion of various political forces, not just the majority.

Regarding the retarded positions, the speaker noted that work with the Cabinet of Ministers on the return of competitions for positions is underway. The issue of special inspections in the current situation with the NACP remains an open issue. “I hope that by the end of the year we will present an updated draft law №3491 in the hall, which will be aimed at resuming competitions, but taking into account the possibility of the National Civil Service Agency and civil servants, so that we can realistically do so later.” The second important point in this bill is the abolition of the article on so-called political dismissals, because expectations from this instrument were exaggerated, said Oleksandr Kornienko.

Regarding the progress of the reform, the speaker noted that the first government became very reformist with the need for quick appointments, and the next – became more responsible for the reform: “We began to develop documentation. There was an attempt to introduce a bill on amendments to the law “On Civil Service” (it, unfortunately, failed in the session hall). Now we are working to make it a deputy version. ”

Oleksandr Kornienko also said that the Committee discussed the reform of the civil service through the reform of the wage system. He noted that in order to increase the Remuneration Fund, sooner or later it will be necessary to reduce civil servants. This should be done wisely by finding alternatives, in particular those provided for in the adopted law №3651. “We have made an amendment that will allow employees who will be fired during the reorganization of district administrations to be employed without a competition for a similar position in local government. About 12-13 thousand employees are laid off, and, according to our cursory estimates, 60% can immediately go to work in the MHI. The civil service can become a provider of personnel for other areas as well. ”

“I would not say that it is a step backwards, it is a deviation to the side. But you can return to the main road from the side road, “Oleksandr Kornienko said, noting that this is the goal for the next quarter. We are talking about the return of tenders, the adoption of the law on civil service, try to pass a law on administrative procedure, try to take steps to register and discuss the bill on the remuneration system.

Natalia Aliushyna, Head of the National Agency of Ukraine for Civil Service, continued that the issue of remuneration of civil servants is very sensitive at the level of districts and regions. Because currently the minimum wage is lower than the minimum wage set in the country, despite a threefold increase in the Wage Fund. The speaker noted that the civil service withstood the global pandemic and its effectiveness was not affected.

Natalia Aliushyna stressed that one of the priorities of the civil service reform, enshrined in the strategy in 2016, is to reform the wage system. To date, a number of decisions have been made: the relevant Concept with an action plan has been approved, the Ministry of Justice is testing the Methodology of job classification, and an order to launch a pilot project on piloting job classification has been prepared and approved. “We are currently modeling wages at four government agencies. These are the Ministry of Finance, the Ministry of Digital Transformation, the Secretariat of the Cabinet of Ministers, as well as the National Agency for Civil Service Affairs together with its territorial bodies. ”

The presented bill on the system of remuneration reflects the issue of bonuses, which is sensitive for the sphere. They should be quarterly based on performance appraisal results.

Tetyana Kovtun, Deputy State Secretary of the Cabinet of Ministers of Ukraine, noted that given the study of the experience of different countries, public administration reform is a long process that can take decades. “It’s like repairing a moving plane: at the same time, institutions need to work and be in a state of reconstruction.” Among the key challenges are the lack of consensus in society on the definition of good governance and its mechanisms, and the ability of the civil service itself to change. According to her, the failure of the reform cannot be said given the implementation of indicators.

Ihor Koliushko, Head of the Board, Center for Political and Legal Reforms, noted that what is called “administrative reform” in Ukraine is historically divided into two: local self-government reform and government reform. “The main problem with government reform is that we are not talking openly about its goals and objectives until the end. There is a constant reduction of reform to technological things: changes in payroll, the order of appointment, regulations. In fact, they are often forgotten conceptual purpose. It is that the government and all power must serve the interests of society, ensure the sustainable development of the country. This requires shaping policy and systematically implementing it. ”

The speaker defined the general impression of the government in the second half of 2020. First, the government was not formed by the Prime Minister, but by the President’s Office. This leads to problems in the government’s relations with parliament in the first months of its work. Second, the government focuses on the pandemic. Among the positive achievements, the speaker included the introduction and adoption in the first reading of the bill “On Administrative Procedure” (№3475), as well as government policy in the field of administrative services and digital transformation. At the same time, the problems of destruction of the civil service by the authorities are recognized, but not corrected. The tasks of reforming the organization and activities of ministries and the government set by the Reform Strategy are not being fulfilled. There has been no progress in updating the legislation on the Cabinet of Ministers and central executive bodies, but the issue is being discussed compared to the previous government. Of the eight expert recommendations submitted last year, one was implemented – the law “On Administrative Procedure”

It makes sense to create a new Reform Strategy if the previous one is not implemented, Ihor Koliushko thinks. The new strategy should be qualitatively different and expressed in the following areas:

• to demonstrate the vision of the general system of government with which we want to apply for accession to the EU and NATO, which are reflected in the Constitution;
• be based on non-implemented SIGMA recommendations;
• discussion of plans for preparation of the Strategy with the public and take into account the recommendations of experts;
• abandon the practice of including a minimum of indicators in strategic documents to make it easier to report on implementation;
• honestly state the conditions under which the Strategy has a chance to be implemented: observance of the constitutional role of the government, leadership of the Prime Minister, support of the President and Parliament;
• involve in the development of external experts both Ukrainian and foreign, recommended by the EU.

Viktor Tymoshchuk, Deputy Head of the Board, Centre of Policy and Legal Reform, noted that the most painful problem that needs to be addressed first is the law “On Civil Service.” Commenting on Oleksandr Kornienko’s speech, the speaker noted: “It was not a bypass road, it was a rollback for 2-3 years ago. Political dismissals, departure from the principles of stability of the professional civil service, ruined competitions and many other things have hit the public administration system hard. Recognition of the problem is a plus, but it needs to be corrected much faster. ”

The speaker also believes that it is wrong to involve people from business in public administration given the difference between public and private systems.

“The law on administrative procedures will be a big plus for the new government. The history of this bill goes back 20 years, and the fact that the current government was able to pass it in the first reading is a very serious progress for the development of the system of government. “The speaker drew attention to the reality and importance of the adoption of the law “On Public Consultations”.

Roman Kobets, Expert at the Better Regulation Delivery Office (BRDO), noted that the introduction of weekend quarantine showed the shortcomings of the current decision-making system. In particular, it is said that these decisions are not justified at all, their expediency is not clear, that is, the lack of analysis – the selection of information that justifies the choice. One of the shortcomings of the reform is the lack of capacity of ministries to create the necessary information that would enable them to do so. Those who make decisions understand their content and consequences. The expert suggests first of all to move away from the practice of making “spontaneous-intuitive decisions”.

Constitutional and parliamentary reforms

Yuliia Kyrychenko, Member of the Board, Centre of Policy and Legal Reform; Co-Chairwoman of the RPR Coalition Board, noted that the constitutional reform had not taken place or even begun in a year.

Briefly about the events of the year: on the first day of the parliament of the new convocation, the authorities initiated 7 bills on amendments to the Constitution, which became unexpected for the professional environment, parliamentarians and society as a whole. All of them failed because constitutional changes required a process. Two bills can still become the “body” of the Constitution at the current, 4th session of parliament – a legislative popular initiative and a reduction in the number of deputies to 300.

“The idea of ​​a people’s legislative initiative can be developed. But it is necessary to take a step back and, taking into account the comments of the Constitutional Court and experts, to prescribe changes to this article. Our advice for today is to transfer the initiative center for the development of Constitutional Reform from the President to the Parliament, “the speaker said.

Changes required for the Constitution:

1. Record the results of decentralization reform; these changes must be viewed in conjunction with changes in the improvement of the form of government towards balancing the branches of government;
2. Bring the legislation in line with the Constitution; reforms must have a solid constitutional foundation to remove threats.

Oleksandr Zaslavsky, Director of Analytics at the Agency for Legislative Initiatives, noted that a systemic vision and a systematic approach to reform should be developed to reform the parliament.

The speaker reminded that the reform of the parliament began in 2016 with the development and presentation of the Roadmap for internal reform of the Verkhovna Rada. According to last year’s estimates of the Laboratory before the previous Forum in Toronto, less than 42% of the 52 recommendations of the map were implemented.

After that, the representatives of the public sector provided the new parliamentarians with updated proposals on priority steps so that the reform would not slow down. This is primarily a revision of the 52 recommendations. Oleksandr Zaslavsky noted that apart from this Map and the adopted resolution on its implementation, there is no document that can be used to implement and control the implementation of the reform. The next important steps are the adoption of the bill “On the peculiarities of civil service in the Verkhovna Rada” and the Code of Ethics for Deputies. None of them has been implemented in the last year. According to the latest estimates of experts, the Roadmap is not fulfilled by 50%.

Among the positive changes are the reduction of the number of committees to 23, work on draft laws on the opposition, political parties, the Verkhovna Rada’s audit and publication of a report, registration and adoption in the first reading of the bill on the control function (№4131), digitalization.

Among the problems are the lack of a systematic vision of the reform, the low level of quality of proposals in terms of legal techniques and the imbalance of power between the president and parliament.

The first necessary steps are to update the Roadmap, to harmonize the regulations with the Constitution, and to adopt the above-mentioned laws and codes. Oleksandr Zaslavsky added that changes to the Constitution should take place through the parliament: “Without comprehensive amendments to the Constitution, the reform of the parliament itself will not be fully implemented. First of all, we are talking about the introduction of a simple majority vote for the so-called “ordinary” laws. We would also insist on restricting the individual right of legislative initiative of the People’s Deputy and abolishing the mandatory mandate. ”

Olha Sovhyrya, MP, Head of the Parliament Subcommittee on the Political Reform and Constitutional Law of the Parliament Committee on Legal Policy, reminded that the bill on reducing the number of MPs had been previously approved by parliament. He received 236 votes, indicating that at this stage he is unlikely to get 300 votes for final approval.

Regarding the forthcoming amendments to the Constitution, active work is underway to prepare amendments to the Constitution in terms of decentralization and the formation of the procedure for appointing NABU and State Research Bureau (SRB) chairmen.

Igor Kohut, Director of the USAID RADA Program, noted that the main drawback in terms of the constitutional crisis was the poor legislative process. Regardless of the convocation, due to political expediency, parliamentarians neglect procedures, expertise, consultation, participation of stakeholders, inclusive discussion process, etc.

Another problem is the lack of qualified government staff who can propose quality political legislative decisions to parliament. The pandemic showed the need for the Council to learn basic tools, technical re-equipment – this is inherent in the internal reform, staff should be ready to work in such circumstances.

“If at the level of the Roadmap we see very little progress, then at the level of internal parliamentary reform it is happening. This can be attributed only to the leadership qualities of the Chairman of the Verkhovna Rada, members of the Presidium, and the leadership of the modern apparatus. There is a serious revision of the structure of the apparatus, new units are created, the potential for existing ones is created. This is a far-reaching investment in the further development of the parliament and its institutional capacity, “Ihor Kohut said.

“The issue of control function lies in the constitutional, institutional and legislative areas. The already mentioned bill №4131 is the first polar star for us, which may give the parliament a guideline on how to move forward in strengthening its ability to control the government, public finances, etc., – said the speaker. – Of course, there are imperfections in it, but we in principle act that it was considered and accepted with those amendments which are brought today by People’s Deputies. It unites the parliament. ”

At the same time, there is the philosophical issue of control in terms of the role of parliament in forming the government, as well as the issue of the procedure for passing laws, starting with the initiative.

Petro Stetsiuk, Scientific Adviser on Legal Issues of the Razumkov Center, Judge of the Constitutional Court (retired), expressed his thesis on constitutional reform:

1. If constitutional reform has no ultimate goal, then there is probably no place to enforce the basic law.
2. There is a crisis, but the speaker expressed doubts whether it is constitutional. Perhaps this is a crisis of the institution of constitutional justice. Most likely, this is a crisis of domestic governance, a crisis of relations between the Office of the Head of State, his office and the main constitutional body of the state. In this situation there is a personal moment.
3. Constitutional reform must be comprehensive, balanced, and meet the goal enshrined in the constitution.

Yuliia Zaichenko, Deputy Head of the Parliamentary Reform Office, EU UNDP Programme, noted that for more than a year the Office has been working as an advisory group for the leadership of the Verkhovna Rada, committees and staff. “When we talk about parliamentary and constitutional reform, first of all we are talking about the urgent need to improve decision-making processes in our state.” The speaker noted that this concerns not only compliance with and improvement of regulations, but also the improvement of the entire system on the basis of which solutions are developed, implemented and communicated.

Moderator: Oleksandr Marusyak, Constitutional Law Expert at Centre of Policy and Legal Reform

Read the sectoral briefs on reforms prepared for Ukraine Reform Conference 2020/2021

The Forum is organized by the RPR Coalition in partnership with the Embassy of the Republic of Lithuania. The Forum is supported by the Ministry of Foreign Affairs of the Republic of Lithuania, the European Union, the EU Project Pravo-Justice, «Civil Society for Enhanced Democracy and Human Rights in Ukraine» project implemented by UNDP Ukraine under financial support of the Ministry of Foreign Affairs of Denmark, and the Embassy of Canada in Ukraine. The Forum is organized within the framework of the project “Core Support of the Reanimation Package of Reforms Coalition” carried out by the RPR Coalition and is made possible by the generous support of the American people through The United States Agency for International Development (USAID) within the Ukraine Civil Society Sectoral Support Activity, implemented by The Initiative Center to Support Social Action “Ednannia” in partnership with the Ukrainian Center for Independent Political Research and the Centre for Democracy and Rule of Law.