5.6.1. Domestic compliance: Bounded institutional development and shallow Europeanisation

Since 1 January 2006, the Croatian civil service has been regulated by the new CSA, though the previous law (i.e., the CSEA of 2001) still remains valid with regard to salaries and other benefits until new salary legislation is adopted. In July 2008, the long-awaited Civil Service Employees in Local and Regional Self-Governments Act was adopted by the

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parliament. In light of European principles of civil service, the new CSA has brought about certain crucial improvements, though „continuity‟ still informs certain other aspects of the Croatian civil service regime.

Regarding improvements, contrary to the previous law, the CSA specifies clearly that public employees in the state administration are regulated by general labour law (SIGMA, 2006: 8). Furthermore, the distinction between civil servants and employees is no longer made according to the level of education, but according to functions (ibid). Significantly, article 74/3 in the CSA introduces the institution of a professional and merit-based managerial civil service by including the posts of managerial civil servants, senior civil servants, and junior civil servants (ibid: 9). This has been a positive development, considering that until 2005 all managerial posts were regulated outside the existing CSEA and were filled through direct political appointments. Concerning classification, article 74 specifies that civil service posts are classified by common standards across all state bodies.

To this end, the Regulation on the Classification of Civil Service Jobs was adopted (after a series of delays) in 2007 and amended in 2008, and is „generally in line with good practice‟

(SIGMA, 2008: 11). Unlike the CSEA, the new CSA introduces the principles of impartiality (Art. 6), equal treatment and the obligation of superiors not to discriminate because of political views (Art. 11) (ibid: 11-12). As regards training, the CSA states that the continuous improvement of professional skills through in-house training is a requirement for all civil servants (ibid: 14). As noted above, a Training Centre was established within the CSOA in June 2005, and the necessary training strategy and government decrees have been adopted21. Finally, regarding co-ordination and management of the civil service, article 38 of the CSA specifies that the CSOA is the main service in charge of monitoring and implementing the CSA (ibid: 15-16).

Turning to „continuity‟, a number of old regulations, stipulations and practices have proved

„sticky‟ (cf. Pierson, 2004) following the enactment of the new CSA. To begin with, the Croatian Constitution still devotes one short and general article to the state administration, state officials and state employees, abstaining from prescribing a special civil service model. Further, the definition of the scope of the civil service has remained considerably

21 In 2007 the centre delivered more than 60 programmes (254 training modules) attended by 3675 civil servants (SIGMA, 2008: 14).

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clear and narrow as, similarly to the CSEA of 2001, the scope of the CSA is largely restricted to officials who exercise state authority. By contrast, employees in the wider public sector – for example, in the police, foreign affairs, and the armed forces – are subject to separate legislation (SIGMA, 2006: 8). In December 2007, the entire public sector staff (funded from state budgets) numbered about 190,000, excluding the armed forces22. Of these, about 90,000 form part of the core civil service and are therefore covered by the CSA and supplementary special acts (SIGMA, 2008: 8). At the same time, the scope of the CSA of 2005 is subject to ambiguities as, much as in times past, it distinguishes civil servants and state employees who are within the scope of the civil service law but otherwise subject to ordinary labour law contracts (ibid: 3). Much like times past, formal qualifications play a predominant role in recruitment and promotion (SIGMA, 2006: 3). Perhaps most significantly, the CSA, like its predecessor, reiterates that

„rights, obligations and responsibilities of civil servants and employees shall be governed by a law and pertaining regulations‟. According to SIGMA reports, this stipulation works as a hurdle to the unification of the fragmentary Croatian civil service system as it „will unfortunately continue to foster a proliferation of special statutes and regulations‟

(SIGMA, 2008: 9) of certain groups of civil servants (e.g., the police).

Again, reflecting enduring past practices, recruitment and appointment remain a decentralised process. Individual ministries and state organisations remain in de facto control, despite the new legal provisions which clearly define the CSOA as the central authority in charge (Article 38; SIGMA, 2008). In effect, the slow staffing process, weak administrative capacity, and lack of ministerial footing of the CSOA has had significant impact on its capacity to assume and execute all of its tasks related to the implementation and monitoring of the new CSA (SIGMA, 2009: 4). For instance, between 2005 and 2009, the CSOA lacked the capacity to ensure homogenous classification of civil service positions (despite the enactment of the corresponding decree; see above) (SIGMA, 2008:

12). Likewise, due to staff shortages23 the Personnel Policy and Human Resources Management Department within the CSOA had (and still has) in many respects to delegate

22 The total cost in 2007 was HRK 19,9 billion, representing 17.8 per cent of the budget (total) and 7.26 per cent of GDP (Data provided by the MoF; cited in SIGMA, 2008: 8).

23 For instance, in 2007 the HRMDD in the CSOA had 10 staff: 5 staff in charge of HR planning and 5 in the unit for HR development (SIGMA, 2007: 22).

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its responsibility for participating in all the recruitment European Commissions (ibid: 3, 16). Indeed, although the capacity of the CSOA/Ministry of Administration is slowly and reluctantly increasing, it is still insufficient to fulfil its demanding supervisory role24 (ibid:

11). Thus, considering the CSOA‟s limited oversight capacity and the fact that previous practices did not favour merit-based recruitment and/or promotion, there are strong indications that the law has not been adequately implemented. Regarding training, though the Training Centre has adequate premises and its staff size is progressively increasing (from just 3 in 2005 to 15 in 2008), staff turnover and inexperience remain a reality (ibid:

14). By and large, the main constraining factor for training is funds. For instance, of the requested (and, in principle, agreed) HRK 5.8 million for training activities in 2008, only 1.73 million was allocated by the parliament (ibid: 4).

On the subject of de-politicisation of the senior civil service, the inclusion of Article 74 was literally the outcome of a compromise between the Croatian government and the external donors (i.e., the World Bank, the OECD and the EU). More precisely, while the government agreed to take on de-politicisation for quite a large number of senior managerial posts25, it did so under the condition that competitive recruitment in all management posts would be postponed until after the next general elections scheduled for November 2007 (Art. 151). In effect, this provision meant that the incumbents in positions that the new CSA defined as civil servant posts, most of them political appointees, more employees are still needed in light of the creation of new internal departments (e.g., Department of Ethics, Department for Minorities, Department for General Administrative Procedures, etc.) (SIGMA, 2008: 15; SIGMA, 2009).

25 The CSA stipulates that the positions of the secretaries at the ministries, deputy secretary of the Government, head of the Government Office, deputy state secretary of the CSOA and assistant director of the state administration organisations are included in the civil service system. However, the principle of recruitment by open and merit-based competition remains excluded for top managerial posts. Besides state secretaries, these positions still include also heads of central state offices and state offices as well as heads of state administrative organisations and state administrative offices who are to be appointed by the government upon the proposal of the prime minister (Art. 26 of the Government Act).

26 This refers particularly to the State Administration System Act and the Government of the Republic of Croatia Act.

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elections in November 2007 and the new government entering office in January 2008, recruitment to the newly „de-politicised‟ senior management posts was undertaken.

Interestingly, de-politicisation was circumscribed on the ground since appointment procedures remained „rather informal and politicians still play[ed] a decisive role in recruitment‟ (SIGMA, 2008: 1). At the end of 2007, political leaders from different parties of the new broader coalition government of PM Sanader announced publicly in the media that they would gain a certain number of „depoliticised‟ posts (ibid: 3). As a result, a large number of new political positions (i.e., state secretaries) were created, replacing the positions that were supposed to be depoliticised. Given the simplified recruitment procedure27 being pursued and the decisive participation of politicians, in January 2008 34 state secretaries were appointed while 60 more were appointed after the new coalition government of PM Sanader was formed in January 2008 (ibid: 1).

Finally, the adoption of the new Salaries Act (ready by 2008) has been subject to considerable delays and is still pending parliamentary approval. This is partly due to resistance from the trade unions, partly because of the parliament‟s decision to opt for a two-reading procedure rather than the fast-track/one-reading procedure proposed by the government, and partly due to the global financial crisis that hit Croatia in 2008 (SIGMA, 2009: 4). The SIGMA 2009 Administrative Legal Framework Assessment reports that the 2007/8 global financial crisis has severely affected PAR, postponing the adoption of the Salaries Act, the State Administration Reform Strategy for the period 2008-2011 (SARS 2008-2011), adopted in 2008 (see below) and resulting in Croatia‟s new PM, Jadranka Kosor (HDZ), imposing a 6 per cent pay cut for civil servants (10 per cent for senior public servants). Inevitably such a restrictive wage policy has caused discontent, especially among young and qualified civil servants, and has led to high staff turnover in key government organisations. Although there is no reliable data, interviews reveal that more than 100 young civil servants in the MFAEI and MoF have left the administration since August 2009. With them, the „institutional memory‟ has gone as well (interview with

27 Following the enactment of the CSA the government adopted on 12 January 2006 the Decree on the Announcement of Vacancies and Implementation of Public Competition Procedures and Internal Announcement in the Civil Service. However, successive governments led by the HDZ amended the said decree in 2007 and 2008 respectively, with the aim to permit simplified recruitment procedures (see SIGMA, 2008: 3). Accordingly, the minister or other state administrative body, or person authorised by them, interviews candidates and this interview is decisive for the final recruitment decision (ibid).

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K.M.; Ministry of Administration). In such unfavourable conditions, the overhaul of other interdependent legislation related to CSA (most notably the Government Act and the System of State Administration Act) has once again been placed in limbo (SIGMA, 2009).

In short, the new CSA has not fully „replaced‟ the old regulative system as previously existing legislation still remains in place and past habits favouring politicisation are yet to be overcome. Thus, as in times past, politicisation and professionalisation as well as the unification of the Croatian civil service system still remain „a hope more than a reality‟

(SIGMA, 2008: 1; 2009). Croatian political elites (and not just the main ruling party, the HDZ) have posed considerable resistance to implementing the new rules. In this respect, domestic factors and actors have largely been non-favourable to „deep‟ administrative modernisation qua Europeanisation. In light of this „shallow‟ pattern of Europeanisation (cf. Goetz, 2005), what has been the response and actual power of the EU in prompting domestic compliance?

5.6.2. Monitoring the Monitors: Strong EU rhetoric but moderate EU effects?

Following the adoption of the CSA in 2005, the European Commission followed closely the implementation of the new law through the yearly SIGMA public administration assessment reports. Taking stock of the government‟s defective stance regarding administrative reform in general, and the full implementation of the CSA in particular, the European Commission stepped up its tone considerably, as evidenced both by statements issued by EU officials and by its yearly Progress Reports. For instance, in its 2007 Progress Report (2007: 8) the European Commission stated:

„Limited progress has been made on public administration reform [...] two of the thirteen regulations necessary for full implementation of the Civil Service Law remain to be adopted, despite this law being adopted in January 2006. There is still no overall comprehensive strategic framework for public administration reform, which continues to be implemented only in a piecemeal manner. Management and administrative capacity of institutions in charge of public administration reform, particularly the Central State Office for Administration (CSOA), remains weak [...] In many state institutions there is still general resistance towards merit-based personnel policy and career planning. The civil service continues to be politicised. Policy implementation often remains in the hands of political advisors. Undue political influence, even in the recruitment of technical staff, continues [...] Overall, limited progress has been achieved in the area of public administration reform. It continues to represent a major challenge for Croatia. A clear political commitment and sustained and serious efforts are needed‟.

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At the same time, the revised Accession Partnership for Croatia, adopted on 12 February 2008, contained some key targets for the country to achieve in order to fulfill the political criteria for accession to the EU. These were to „fully implement public administration reform measures on administrative procedures and on recruitment, promotion, training and depoliticisation‟ and to „improve human resource management in areas of public administration‟ (Council of Ministers, 2008). Following these stated political guidelines, the new broader coalition government under PM Sanader, invested in office in January 2008, proceeded with two rather cosmetic responses. On the one hand, it appointed Ms.

Djurdja Adlesić (HSLS), Deputy Prime Minister, in charge of co-ordinating PAR. On the other hand, following a series of delays and considerable resistance, the new government adopted in March 2008 the SARS 2008-2011 (Croatian Government, 2008b).

The European Commission‟s response was rather mixed as manifested in its 2008 Progress Report. On the one hand, it welcomed these positive developments by noting that „Some progress has been made on public administration reform‟, whereas, on the other, it continued to voice concerns over the slow and reluctant pace of implementation of the CSA and SARS 2008-2011: „public administration remains weak and the required reforms continue to represent a major challenge for Croatia. A clear political commitment and further sustained efforts are needed‟ (European Commission, 2008a: 7). In effect, neither had the appointment of Ms. Adlesić succeeded in clarifying who had the leading role in driving and co-ordinating PAR, nor had the implementation of SARS 2008-2011 begun (SIGMA, 2008: 4).

Following the appointment of a new cabinet under PM Kosor in July 2009, a new post of Minister for Administration (formerly the CSOA) was created in an attempt to inject the necessary political impetus into the reform process. Unlike her predecessor, Jadranka Kosor viewed herself as a reform-oriented prime minister capable of surmounting domestic resistance and depoliticising the administration. In view of the fact that under her leadership the Slovenian blockade was lifted and accession negotiations were approaching conclusion, this organisational change constituted a potential path-breaking step towards implementing the SARS 2008-2011 and the CSA. Yet as noted above, the bad economic

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situation and subsequent fiscal strains, coupled with domestic resistance and inertia, proved unfavourable to full implementation. Accordingly, the European Commission in its 2009 Progress Report would state (2009a: 8):

The draft Law on Civil Service Salaries has still not been adopted and a merit–based system of promotion and remuneration is missing. The civil service continues to suffer from many shortcomings, such as politicisation, low salaries (which fail to attract and retain sufficient numbers of qualified civil servants), lack of clear performance appraisal indicators, and weak human resources planning and management. Civil service salaries have been further cut to mitigate the effects of the financial crisis and a recruitment freeze introduced. Decision-making continues to be highly centralised with limited delegation of powers to middle and lower level management, leading to inefficiencies‟.

Although there are no official data, public statements of EU officials suggest that by mid-2010 Croatian public administration still fell short of meeting the European administrative principles. In this respect, neither the explicit PAR obligations under the revised 2008 Accession Partnership nor the systematic monitoring of the European Commission throughout the period could render the EU‟s „bureaucratic criterion‟ credible enough to ensure something more than partial compliance. Arguably, the lack of EU „administrative acquis‟ in conjunction with the Union‟s inconsistent association of rewards has crucially undermined its leverage in conditioning the full institutionalisation of the new rules. It is therefore highly plausible that European Commission officials, taking stock of the country‟s slow and „shallow‟ engagement in implementing administrative reforms, will explicitly link the closure of the controversial Chapter 23 Judiciary and Fundamental Rights, among others, to the reform of public administration. In particular, the daily Jutarnji List of July 19, 2010 claimed that Croatian governing elites were requested, through a confidential letter sent to the Croatian government on 25 June 2010, to meet 21 informal „closing benchmarks‟. Croatian policy-makers were arguably required to de-politicise the civil service, create a legal basis for the establishment of a professional civil service, and adopt the Salaries Act. However, the author has not been able to verify this information. That said, it remains to be seen whether concluding negotiations in Chapter 23 (scheduled for the first half of 2011) will lead towards a real breakthrough in tackling the Croatian bureaucratic edifice.

157 5.7. Conclusion

This chapter showed that the Croatian civil service system, though rigid in structure (cf.

Knill, 2001), has been adapted (at least at the formal level) under foreign (including EU) direction. Throughout the 1990s the creation of a modern professional bureaucracy was not among the priorities of the nationalist regime of President TuĎman. In this respect, a great opportunity for administrative modernisation was lost, with past practices and structures surviving the „breakdown‟ of the socialist regime. The outvoting of the authoritarian HDZ in 2000 and the subsequent investiture of democratic forces in office coincided with the increased involvement of the international community, including the EU, to strengthen the Croatian state after the 1998/9 economic recession. Largely as a response to the mounting fiscal imbalances, Croatian elites were pushed to seek financial assistance and advice from IFIs. At the same time, the government was negotiating an SAA with the EU, meaning that over time PAR would constitute a key accession condition.

The adoption of the new civil service legislation (CSA) in July 2005 represents a potentially ground-breaking step towards the establishment of a modern, Weberian-like pattern of public administration in Croatia. To an extent, formal compliance occurred under the timely „conjunction‟ of multiple external conditional incentives and not solely as a result of EU conditionality. Yet „transformation‟ through „replacement‟ has proved to have a highly contentious, incremental, reluctant and, above all, „bounded‟ effect (cf.

Thelen, 2003; Pierson, 2004). Since the existing legislation corresponded to a strong normative tradition dating back to previous social regimes, external pressures were mediated by internal institutional legacies and powerful veto players (political elites) and their vested interests. At the same time, non-voluntary unfavourable conditions such as the lack of financial and/or administrative (including staffing) capacity as well as the country‟s bad economic situation have, by and large, constrained elites‟ actions in favour of reform.

Without a doubt, the EU‟s weak legal leverage in the area of public administration also helps explain the Croatian governing elites‟ reluctance to renounce in practice their power in controlling the state. Therefore, while external conditional incentives did constitute catalysts for formal institutional change, thus far transformation seems „shallow‟ (cf.

Goetz, 2005) and partial as Croatian bureaucracy still remains de facto deeply politicised and unprofessional.

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The next chapter traces the impact of European integration on Croatia‟s administrative procedures and justice systems.

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6

Administrative Procedures and Judiciary

6.1. Introduction

The previous chapter explored the impact of European integration on Croatia‟s civil service system. This chapter serves to widen the lens beyond matters of civil service per se to the areas of administrative procedures and legality. It offers an opportunity to explore

The previous chapter explored the impact of European integration on Croatia‟s civil service system. This chapter serves to widen the lens beyond matters of civil service per se to the areas of administrative procedures and legality. It offers an opportunity to explore

In document Enlargement Goes Western Balkans-Croatian Institutions in Time [:] Sluggish Institutional Evolution, Resilience, and Shallow Europeanisation (Page 149-160)