Administration Ministry planning to cut costs, number of employees



Zagreb, 221118.
Redovita sjednica Vlade RH u Banskim dvorima.
Na fotografiji: Lovro Kuscevic
Foto: Bruno Konjevic / CROPIX
Bruno Konjevic / CROPIX

Lovro Kušćević, Minister of Public Administration

The Government will present plans for dissolution of State Administration Offices (UDUs), transfer of authority to counties and project of optimization of local and regional government units in Rijeka to prefects today. The contract worth HRK 20 million that should result in rationalization and improved efficiency of local government units is to be signed today.

UDUs are spread across 20 counties and operate in all parts of Croatia and employ 2,508 people, while counties employ 1,267 people. The plan is to cut the number of employees some 500 through severance agreements in 2019. UDUs currently cost the State some HRK 350 million annually. The money will go to counties, which will take over most of responsibilities of UDUs. Some responsibilities like maintenance of voter registers, inspections and supervision of representative bodies will remain on State level.

Transfer of authority

UDUs are currently performing  more than 200 different jobs, which will be transferred to counties on 1 January 2020, which will strengthen counties. These jobs include opening businesses, categorization of apartments, issuing of different permits for engaging in activities and more.

-There are two goals: better and more efficient performance and getting closer to the citizens because they are the ones who elect prefects, who will now be in charge of those jobs on local level, rather than someone in Zagreb. It has been shown that counties do some jobs better than the State. Counties will take over a significant number of UDU employees and reassign them depending on whether more workers are needed for performing jobs that the State was responsible for thus far or for performing jobs of respective counties - said Administration Minister Lovro Kuščević. When it comes to rationalization, Kuščević revealed that it will be implemented as there will be 20 fewer administrative bodies - general, financial and technical responsibilities will be consolidated, some people will retire (approximately 300 over a period of four years), and some 500 workers will be laid off with severance in 2019. However, financial rationalization will be absent as wages in counties are higher compared to UDUs, meaning that some HRK 70 million more will be spent on wages in the first year, with the figure expected to return to current level in about four years.

-Reforms do not yield results overnight - noted Kuščević.

Some 52 regulations will have to be changed by start of 2019 in order to implement this measure, adopt the new State Administration System Act, which will be sent into Sabor procedure by the end of the year and will come into force on 1 January 2020.

New analysis

A detailed data analysis will be performed first as part of the optimization process. This will present the foundation for classification of local government units into categories (counties, large cities, small cities, underdeveloped or poverty-stricken cities, large municipalities and underdeveloped or poverty-stricken municipalities) as well as for drawing up lists of services that local government units are obligated to provide. Those that will not be able to provide said services after a one-year adjustment period will be merged with more developed local government units.

The list of services should define level of quality of services that local government units are obligated to provide to residents as well as define level of efficiency, availability, transparency and fiscal and functional sustainability, which is a prerequisite for survival of local government units.

-If they cannot do that, a city or a county will take over their function. We will have a model of what needs to be done by 2020. Currently we have most of the 400 parameters that will be used to analyze operation of local government units. All that is left is to incorporate them into a real model - said Kuščević.

Head of the department of administration at the Faculty of Law at the University of Zagreb, Professor Ivan Koprić criticized Kuščević's suggestion and expressed belief that we are regressing to the way things were before 2001.

-That sort of mistaking State authority for that of local government units is what caused the Council of Europe to react, with county offices dissolved in 2001 and their authorities merged into one State Administration Office, while heads were appointed to manage the Office. The problem was that politics influenced how many issues were addressed through prefects. There was a lot of corruption, violation of regulations and crime. Now we are returning to the model that we barely freed ourselves from - said Koprić. He added that this is just an attempt to reduce the level of professionalism and strengthen the role of prefects with the aim of finding a purpose for counties, which otherwise serve only as 'a sort of mechanism for transferring money from State budget to local institutions and government units, with prefects filtering the processes in line with their political affiliations'.

Clear link

-When you take a look at which party most prefects come from, it becomes clear why this Government wants to strengthen their influence. It is sad that permits, concessions and similar decisions will return under significant influence of politics - he concluded. He does not see any rationalization as far as cutting the number of UDU employees goes­. As far as optimization of the system goes, he pointed out that analyses have been drawn up and added that the model should have been prepared by now according to the strategy.

-The Administration Ministry under former Minister Davorin Mlakar worked on the same IT system with 450 indicators that the Administration Ministry is planning to launch now. During his term, an IT company with employees was hired on top of all other people working on it in Croatia. In the end, the project failed and the data remained locked in the private company - said Koprić.

He noted that the second idea, determining categories of local government units in accordance with their size and strength with the aim of implementing a territorial transformation is not in line with constitutional principle of equality of all citizens and a bad idea.

-Citizens in all local government units must have about equal opportunities, rights and responsibilities. The differentiation between 'poverty-stricken' and 'large' cities will only speed up internal migration, cost the State budget more and result in migration of population to larger and more attractive cities - concluded Koprić.