All that glisters is not gold: new public management and corruption in Malawi's local governance

Abstract

This paper examines the impact of the new public management (NPM) on corruption at the Malawian local government level. The study was based on interviews conducted in six local government assemblies in Malawi. Qualitative data were collected mainly through in-depth personal interviews with Assembly managers and councillors. The study also relied on insights gained from a review of various government literatures. It found that NPM reforms in Malawi have led to increased levels of corruption. It is feared that this situation could have massive negative impacts on economic development. To address these problems, the paper recommends the implementation of the public governance model, since this has built-in mechanisms that could considerably mitigate the corruption that has resulted from the introduction of NPM.

Keywords:

• New public management
• corruption
• public governance
• local government
• Malawi

1. INTRODUCTION

The new public management (NPM) paradigm features prominently in both contemporary public-sector reform and public-sector management literature. Key to NPM is the introduction of market principles in the running of the public sector. The rationale is to replace the excessively rigid and bureaucratic traditional public administration with a fast-moving form of public management so as to achieve high levels of efficiency, effectiveness and economy in the delivery of public goods and services.

Generally, NPM reforms have been trumpeted as both necessary and successful (Pollitt & Bouckaert, 2000). Christensen and Laegreid (2004:129) found that public managers saw increasing awareness of goals, means and results and an improvement in the control and activities of the public service. However, Pollitt (2000) took a critical look at some unintended consequences of NPM. This author suspects that the architects of NPM were ‘so confident of its benefits that they were content to leave the results as matters of faith rather than as issues to be checked and evaluated’ (Pollitt 2003:38). This view is supported by Christensen and Laegreid, who argue that the ‘effects and implications of NPM are often assumed or promised but not well documented’ (2001:74). It is not the intention of the present study to delve into this discussion: it is sufficient to say that NPM has had mixed results. In some instances it has fulfilled the reformers’ expectations, while in others it has proved a failure (Polidano et al., 1998:285). In certain cases it has had undesirable consequences, one of which has been an increase in the levels of corruption.

Malawi became a multi-party democracy in 1994 under the United Democratic Front leadership after 30 years of the autocratic and single-party rule of the Malawi Congress Party. To create a viable and vibrant civil service to deal with the challenges of the new dispensation, namely to alleviate poverty and achieve sustainable democratic and good governance policy outcomes, the new government implemented many public-sector reforms with the support of various donor partners. The reforms were enshrined in the Civil Service Action Plan of 1996 and the Public Sector Management Reform Programme 2002–2006 of 2002, and included the following: institutional rationalisation and realignment with policy and legislative framework; reorganisation of ministries (functional reviews) to create autonomous agencies (authorities); viable human resource management practices; conditions of service; performance contracts scheme; privatisation; outcome-based budget and financial management systems; decentralisation; outsourcing/contracting out; user fees; information communication technology; and economic management (Government of Malawi [GoM], 1996, 2002). Although the overall reform initiative bundle was called the ‘Public Sector Management Reform Programme’ (Kamanga, 2002; GoM, 2002), it can be seen from the above list that these were typical NPM reforms.

NPM was implemented in Malawi to foster accountability, transparency and good governance (GoM, 1996, 1998a, 2002). However, there have been suggestions that NPM elements have created a breeding ground for corruption at the local government level. This could have massive negative impacts on economic development as this is the level where development initiatives are implemented. In particular, decentralisation in Malawi is promoted as a ‘strategy for realising the country's development goal of poverty reduction’ (GoM, 1998b), through the ‘promotion of infrastructure and economic development’ (Section 146 (2) of the Constitution of Malawi; GoM, 1995) and ‘participation of the people in decision making and development’ (Section 3 of the Malawi Local Government Act; GoM, 1998b). Against this backdrop, this paper assesses the impact of NPM reforms on corruption in Malawi's local government, highlights the challenges this brings, and recommends a public governance model that could mitigate this impact.

2. THE NEW PUBLIC MANAGEMENT PARADIGM

The NPM paradigm is a notoriously difficult and slippery concept to pin down because it has a ‘number of facets or ingredients and from one country and time to another the emphasis may vary between these’ (Pollitt, 2003:27) and ‘there is no simple convergence on one new public management model, but rather … a range of options is available’ (Ferlie et al., 1996:20). In fact, the ‘label covers all types of public sector reforms and excludes nothing’ (Bevir et al., 2003:2). Although Dunleavy and Margetts (2000:13) summarise the NPM paradigm as ‘disaggregation+competition+incentivisation’, we can identify its ‘doctrinal elements’ (Hood, 1991:5) as follows.

First is the implementation of hands-on professional management in the public sector. This means ‘active, visible discretionary control of organisations from named persons at the top, free to manage since accountability requires clear assignment of responsibility for action’ (Hood, 1991:4). This is highlighted by the NPM movement's slogan: ‘Let the managers manage’ and ‘Management is management’ (United Nations, 2001:37). This implies that managers would themselves be responsible for the achievement of results rather than being administrators following politicians’ directives (Hughes, 1998:61).

Second is the adoption of result-oriented public service management. This entails a shift in the focus of management from inputs and process towards outputs and outcomes (Pollitt, 2003:27). Consequently, resource allocation and rewards are linked to measured performance (Hood, 1991:4). The performance and programme budgeting systems look at ‘outputs rather than inputs’ (Kaul, 1997:23), replacing the older line item budgeting (Hughes, 1998: 64) and linking performance information with budgets (United Nations, 2001:40). This makes managers accountable to politicians for outputs and outcomes rather than for inputs and processes.

Third is the adoption of explicit standards and measures of performance, to achieve output-based public service. According to Hood (1991:4), this entails the definition of goals, targets and indicators of success. The argument is that performance management will ensure managerial autonomy so that managers work at their best, address problems of accountability (United Nations Economic Commission for Africa, 2003:14) and regulate the activities of public managers (Minogue, 1998:142). Performance measurements also entail the development of citizen charters that set the standard of service the public has a right to receive and offer some redress for failure to achieve that standard (Hollis & Plokker, 1995:45). As a result, citizens are no longer considered ‘passive recipients of services but active customers’ (Kaul, 1997:15).

Fourth is the use of private-sector styles of management in the public service. The argument is that the private sector is efficient because it uses market principles, and therefore to make government more efficient we need to do the same. The assumption is that ‘running government is like running Marks and Spencer’ (Rayner, cited in Metcalfe & Richards, 1990:156). NPM stresses greater flexibility and autonomy in hiring and rewards and the use of ‘proven’ private-sector management tools (Hood, 1991:5) such as customer service – seeing citizens as ‘customers’ to be served rather than ‘clients’ to be managed (Kettl, 1997:452). There should be ‘greater discipline and parsimony in resource use’, which entails cutting costs, raising productivity, and doing more with less (Hood, 1991:5), directing resources to those programmes most likely to help attain strategic goals (Hughes, 1998:65), cost-effectiveness, and value for money (Kroukamp, 2001:24). In this respect, NPM empowers public officers to be ‘entrepreneurial’ (Osborne & Gaebler 1992) and makes them cost-conscious and more transparent.

Fifth is a move to greater competition in the public sector, since ‘rivalry is the key to lower costs and better standards’ (Hood, 1991:5). Competition is introduced through privatisation, contracting out, public–private partnerships and the introduction of user fees. Privatisation incorporates deregulation and the transfer of ownership of assets from the public to the private sector (Metcalfe & Richards, 1990:156–7) so as to ‘foster efficiency, encourage investment and free public resources for investments in infrastructure and social programmes’ (Khandwalla, 1999:128). On the other hand, contracting out involves the ‘out-sourcing or buying in of goods and services from external sources instead of providing them in-house’ (Larbi, 1999:27). The logic is that the private sector can carry out such services in a more efficient and cost-effective manner than the government. Private–public partnerships involve working arrangements based on ‘mutual commitment (over and above that implied in any contract) between a public-sector organisation and any organisation outside the public sector’ (Bovaird, 2004:200). It entails the ‘broadening and blurring of the frontier between the public and private sectors through the creation of hybrid organisations’ (Pollitt, 2002:474). User fees work to supplement government revenue and make it more efficient and improve quality (Larbi, 1999:32) because users will demand better value for their money. In addition, by providing a way to test market demand, user charges help departments determine the proper scale of delivery and contribute to responsive government (Kroukamp, 2001:30).

Sixth is championing the desegregation and decentralisation of units in the public sector. This involves the ‘breaking up of monolithic units, unbundling of U-form management systems into corporatised units around products, operating decentralised one-line budgets and dealing with one another on an “arms-length” basis’ (Hood, 1991:5). The key is to ‘unbundle’ (Ferlie et al., 1996:12), to ‘debureaucratise the public service and delayer hierarchies within them’ (Larbi, 1999:17), ‘hiving off central government functions to local authorities’ (United Nations Economic Commission for Africa, 2003:9) and ‘hollow[ing] out government’ (Minogue, 2000:12). The idea is that the government should have a ‘smaller policy core overseeing a flatter, less hierarchical, more fragmented implementing periphery’ (Minogue, 2000:12). This in turn achieves the distinction between the policy and operation functions of government so that governments become ‘catalytic’ and they ‘steer instead of row’ (Osborne & Gaebler, 1992:25).

Finally, seventh is the separation of the owner and purchaser functions of government in public service delivery. In this arena, government as the purchaser should be given the liberty to purchase from ‘non-departmental sources’ (Bale & Dale, 1998:108) and even from private providers through a competitive process. The provider–purchaser split involves the principle of ‘capital charging’ (Bale & Dale, 1998:110), which encourages government agencies to pay for the cost of the capital invested in them and to use it responsibly, and enables managers to ask for capital items they really need.

3. THE NEW PUBLIC MANAGEMENT AND CORRUPTION

Generally, corruption involves the illegal transfer of public resources from public to private use. It is defined as the ‘misuse of public office for private gains’ (Chetwynd et al., 2003:6). Nye captures the concept well, describing it as ‘behaviour which deviates from the formal duties of a public role because of private-regarding (personal, close family, private clique) pecuniary or status gains; or violates rules against the exercise of certain types of private-regarding influence’ (1967:419). Corruption as an activity includes (but is not limited to) embezzlement, nepotism, bribery, speed money, extortion, influence peddling and fraud (Chetwynd et al., 2003:6).

Research into the cause–effect relationship between NPM and corruption has been limited and many authors do not establish a direct link. Common in the available literature is the argument that NPM per se does not cause corruption but provides opportunities for it. However, some researchers have argued that ‘it's the opportunity that makes thieves’ (Von Maravic & Reichard, 2003:124). Haque is concerned that ‘increased managerial autonomy in public governance may expand the avenues for using public office for private gains; that decentralised budgeting poses a challenge to financial accountability; and that the “business” of public service may have increased the abuse of official power’ (2000:608). Bresser-Pereira (2001) laments that NPM reforms involving increased flexibility and autonomy may be seen as a new opportunity for nepotism and clientelism. Of all the commentators, Hood makes the plainest statement, saying that the ‘three commonest failings’ of NPM are ‘bribery, misappropriation and extortion; front-line abandonment; and the use of public organisations for personal ego-trips’ (1998:29) – all of which constitute corruption.

According to Gratto et al. (2002:4), NPM has two major implications for corruption: firstly, it creates the potential for corruption in a wide range of actors, and the flexibility of these networks makes it more difficult to maintain accountability and oversight; and secondly, the line between the government and private-sector actors becomes increasingly blurred. Von Maravic and Reichard agree, noting that NPM indirectly fosters corruption as it contributes to:

• a decline of an ethics infrastructure, and alienation and insecurity of public servants;

• intensified markets for contracts and rent seeking behaviour of market participants; and

• a possibility of underpinning supervision and control of the administration due to the decentralisation and fragmented structure of purchaser–provider models (2003:85).

In particular, NPM favours contracting out of public goods and services in the delivery of public services. Contracting out is seen as key to creating the competition necessary for the efficient and effective delivery of public services (Metcalfe & Richards, 1990). However, ‘contracting out enhances the risk of corrupt practices at the interface between private business and governmental discretion’ (Gregory, 1999:66). More often than not, the contracting-out process is open to corruption, mismanagement, profiteering, waste and public immorality (Caiden, 1982; Huque, 2004), since ‘markets are and will continue to be a force tending toward corruption’ (Warren, 2004:340). On the one hand, a person in a high position who formulates government policy or can influence government decision-making seeks, as a quid pro quo, payment for exercising discretionary powers vested in him or her (Jayawickrama, 2001:283). In other instances, powerful actors are motivated to penetrate government wherever possible, either to get privileged access to government contracts or to affect the rules of competition in ways favourable to them (Warren, 2004:340). If this happens, the contracting relationship becomes ‘one of mutual dependence [rather] than one of promoting economic competition’ (Self, 1993:127).

Outsourcing is intended to introduce a financier/purchaser/provider split in the delivery of public services. In most cases the politicians are perceived as the financiers, administration as the purchaser, and private firms (contractors) as the providers (Schedler & Proeller, 2000:85). Von Maravic observes that who is actually the purchaser and who the provider depends very much on the situation, and further argues that between all these actors corruption is possible ‘because they all potentially belong to the public production process and use public money for service delivery’ (2003:13). Moreover, ‘sectors where corruption flourishes are the ones where the government and private firms have a commercial contractual relationship’ (Meny, 2000:205).

The NPM paradigm prescribes privatisation as a means to get rid of inefficient public enterprises, open more room for accountability, and enhance competition. However, just as in contracting out, ‘the process of transferring assets to private ownership is fraught with corrupt opportunities’ (Rose-Ackerman, 1999:35) and ‘ends up as a simple rearrangement of the rent-seeking playing field’ (Hopkins, 2002:584). In many cases, privatisation has ‘amounted to little more than the licensed theft of state property’ (Brown & Cloke, 2004:288) because the bureaucrats and politicians see privatisation as an opportunity for self-enrichment (Hopkins, 2002:584).

In addition, NPM favours decentralisation as an appropriate service delivery mechanism. The argument is that, being closer to the people, local authorities will easily identify peoples’ needs, and thus supply the appropriate form and level of service delivery (Enemuo, 2000). However, in many instances ‘decentralisation is attended by an increase in the number of persons who are involved in corrupt acts’ (Manor, 1999:101). The local elites use control over local government for personal gain rather than to promote community development. Selfish council officials exploit the new opportunities presented by the decentralised structures. Since in a decentralisation system resources are spent and invested at the elected official's discretion (Mawhood, 1993:2), decentralised governance becomes a vehicle for bringing the once centralised and hidden resources closer to the local political elites for plunder. Manor notes that the creation of elected councillors and the decentralisation of resources in the Indian State of Karnataka led to increased corruption (1999:74).

Moreover, because of the overemphasis on results, public officers use undesirable and corrupt means to produce better results (Haque, 2000:608). After all, with NPM it is the results that matter, not how you achieve them. In addition, performance management and emphasis on results have made managers cheat the system by reporting high performance scores although they have obtained low results.

To conclude, NPM has been accused of opening ‘floodgates of corruption’ (Polidano & Hulme, 2001:287) because, in general, the introduction of private-sector motivations and practices has weakened the core ethos of public service within the public sector (Brereton & Temple, 1999:455). In many instances, NPM has led to the ‘aggrandisement of management’ (Hood, 1991:9) and politicians, because it ‘assumes the culture of honesty as given and devices instituted to ensure honesty and neutrality (such as rules of procedure and restraints on discretion) were therefore removed without concern’ (Hood, 1991:16). Moreover, accountability in NPM is more fluid (Hughes, 1998:234) since ‘accountability by contracts is based on the idea of opportunistic behaviour, whereby people learn to distrust each other’ (Christensen & Laegreid, 2004:20). Therefore, even if NPM reforms increase frugality and efficiency, these gains are made at the ‘expense of guarantees of honesty and fair dealing and of security, resilience’ (Hood, 1991:16) and accountability (Minogue, 1998:32), and can lead to corruption.

4. DATA AND METHODS

4.1 Methodology

This paper is based on a case study of local government assemblies in Malawi – case-study research being ‘an ideal methodology when a holistic, in-depth investigation is needed’ (Tellis, 1997:1). Malawi has three administrative regions: the Southern, Central and Northern provinces. The study sampled six of these assemblies, two in each region, so that conclusions drawn should be representative of Malawi as a country. The sampled local assemblies were Blantyre City Assembly and Zomba Municipal Assembly (Southern Region); Salima Town Assembly and Lilongwe City Assembly (Central Region); and Mzuzu City Assembly and Mzimba District Assembly (Northern Region). Qualitative data were collected mainly through in-depth personal interviews with Assembly managers and local politicians (councillors).1 Altogether, 30 councillors and 20 managers were interviewed. Study participants were identified by both random and purposive sampling, the former to give all subjects in the sample frame an equal chance of being included in the study, and the latter to identify people who were regarded as key to the study. Therefore, District Commissioners, Chief Executives, Mayors and Chairpersons of Assemblies were interviewed since by the virtue of their position they were seen to hold information that is central to the study. Other councillors and other members of the Administrative wing were interviewed randomly on the basis of their availability at the time of the study. Confidentiality was assured, to encourage the interviewees to give full information without the fear of negative consequences. The study also reviewed various literature and newspapers to gain further insights.

4.2 Study results

Minogue (2000:8) observes that ‘there has been evidence that NPM reforms have been associated with increased corruption’. This is supported by Washington's argument that ‘some of these reforms may have unintended impacts on the ethics and standards of conduct’ (1997:16). Maesschalk (2004:465) adds that ‘NPM-type reforms are alleged to lead to more collective or even systemic unethical behaviour’. Personal interviews with both the councillors and Assembly managers confirmed these views. It was revealed that many corruption cases result from the incentives, opportunities and motivations provided by the loopholes in the NPM reform elements. The large majority of councillors and Assembly managers felt that NPM leads to increased corruption: 26 of the 30 councillors and 16 of the 20 Assembly managers thought contracting out led to corruption; 26 of the councillors and 13 of the managers attributed corruption to decentralisation; 22 of the councillors and 12 of the managers saw managerial autonomy as a cause of corruption in the local assemblies; 29 of the councillors and 16 of the managers thought user fees led to corruption; and 28 of the councillors and 17 of the managers thought public–private partnerships led to corruption. Each of these trends is further discussed in the sections that follow.

4.2.1 Contracting out and corruption

All of the interviewees asserted that contracting out presents motivations, opportunities and possibilities for corruption. They noted that in many cases the decision to enter into contracts was based not on an existing service need but rather on the desire to assist certain Assembly officials in need. In these cases, ‘contracts are given out to alleviate the official's poverty’ (interview with a councillor) rather than to address the need of the Assembly. It was observed that when office bearers (both councillors and managers) were in financial difficulties, they were awarded contracts to provide some services that were not even needed at the Assembly. Moreover, such contracts are mostly awarded without going through the normal tendering processes.

In other instances, it was noted that office bearers, especially councillors, take a very proactive role in awarding themselves contracts. They expect that each time there is a contract at the Assembly they should be given priority. At one site, an example was given of a councillor who had a quarry and timber contracting company who always wanted to dominate in any constructing activity. It was noted that ‘he goes to the Assembly office whenever there is a chance of a contract to connive with managers and get them to award him a contract’ (interview with Assembly manager).

In addition, interviews confirmed that nepotism and favouritism were allowed to guide the whole process of contracting out. An analysis of the contracts awarded revealed a connection (whether family or friendship) between officials on the contract-awarding committee and successful bidders. Normally, contracts are awarded to relatives and friends. In some instances the officials have their own contracting agencies registered in their relatives’ or friends’ names. It was noted that at one site even messengers have contracting agencies. It was discovered that such agencies dominate almost all of the contracts at the Assembly, thereby ensuring that the Assembly officials award themselves the contracts. The bidding process becomes a mere formality because the winners of the tenders are often predetermined.

At another site, it was learnt that the managers prepare and write winning tenders for prospective contractors that they in turn assess themselves. The prospective contracting companies connive with Assembly officials to write these winning tenders. It was observed that this happens especially when outside evaluators come. When contracts are approved, the contractors give ‘commissions’ to the officials concerned.

It was also observed that the Assembly officials use contractors to advance personal gain. Contracting officials have a great deal of discretion. This allows them to contract out companies under the Assembly's account to carry out private or personal activities. At one site, the sheriff executed a High Court order that the Assembly should surrender its properties for default of payment for cell phones that officials had contracted with Celtel Malawi Limited, but they had committed the Assembly as a subscriber for their personal handsets.

4.2.2 Decentralisation and corruption

Brueckner (1999) argues that corruption is more likely to be a problem in decentralised governments. This is echoed by Washington (1997:16), who agrees that decentralisation has implications for public accountability. This study confirmed this position.

The personal interviews revealed that decentralisation itself has created a breeding ground for corruption. In many cases, the councillors and managers agree to embezzle Assembly funds. The general feeling of the respondents was that decentralisation has put the financial resources within reach of the local elites, which were once very distant from them, thereby opening avenues for corruption. One respondent commented that:

decentralisation has created a lot of greed, expectations and aspirations. Councillors now regard themselves as members of parliament and they squeeze the assemblies to get the perks for personal use. In the same manner, Assembly officials regard themselves as cabinet ministers and sponge the Assembly of its meagre resources. (Interview with Assembly Manager)

As can be seen here, the problem is that the ‘NPM reforms provide these individuals not only with the opportunity to do corruption but also with the mindset to justify it’ (Maesschalk, 2004:465).

In many cases it was confirmed that office bearers exercise their discretion in the decentralised system for their private gain. Assembly officials take advantage of their discretionary powers to siphon off resources from the local assemblies. For instance, at one City Assembly it was noted that the Mayor had purchased retreaded tyres at K11, 750 of which were sold to the Assembly at the price of new tyres. The tyres disintegrated within the month of purchase. The Mayor made a verbal promise to replace the tyres but did not honour it.

4.2.3 Managerial autonomy and corruption

Washington observes that a ‘corollary of management autonomy is that a reduction in detailed rules could allow more room for misconduct and mistakes’ (1997:17), and Monteiro says that ‘elements of NPM, such as managerial autonomy, were often unsuitable for implementation as [they] further eroded accountability in an increasing corrupt environment’ (2002:11). This study confirmed these views as it found out that Assembly managers take advantage of their managerial autonomy to flout rules and embezzle Assembly resources.

The study noted that in Malawi's local assemblies managerial autonomy implies that Assembly managers exercise an enormous amount of discretionary power in their everyday work. The general feeling that came through the interviews was that managerial autonomy has reduced checks on councillors and scrutiny of the way the public service is run. Managers have used their autonomy for personal gain. For instance, at one District Assembly councillors complained to the District Commissioner that ‘your Director of Planning and Development and Building Supervisor have drained a lot of stores resources for their individual gains’ (memo from councillors to the District Commissioner).

Managerial autonomy also entails control over the procurement process without any political interference. It is assumed that Assembly managers are well versed in procurement procedures and so should be freed from the political process for carrying out the necessary tasks. In addition, procurement is regarded as an implementation exercise that lies within the jurisdiction of these managers. However, the study found that managerial autonomy in procurement has introduced opportunities for corruption. Moreover, in many cases councillors are presented with project materials ‘but do not know the cost of these materials and the quantities specified in the contract between the District Assembly and the supplier’ (Ssewankambo et al., 2004:xii). One Assembly manager commented that:

since the Assembly managers are given the autonomy to do the purchasing process, shop owners give ‘commissions’ to the Director of Planning and Development [who purchases project materials] so that they can always purchase from them. Some officers even put it as a condition that they will make their tender fail if they will not give them ‘commissions’. (Interview with Assembly Manager)

The study also observed that increased managerial autonomy has eroded transparency and accountability in the local Assemblies because managers tend to use this freedom to define their own standards and ways of operating. In many cases the new standards conflict with public ethics, raising concerns about possible corruption. Managers can, for instance, choose not to be transparent by refusing the public access to information although legislation requires unlimited access. For instance, during the interviews the author was denied access to some corruption-related information as the Assembly managers regarded it as ‘confidential’. This raises many questions about accountability and transparency.

4.2.4 User fees/cost recovery and corruption

Washington observes that ‘more direct contact with public money coupled with fewer controls over its use may increase the temptation and opportunities to indulge in corrupt or fraudulent practices and make conflicts of interests more likely’ (1997:16), and Fjeldstad confirms that service user charges attract bribes to the bureaucrat (2003:8). In their Malawian local government study, Ssewankambo et al. (2004:xiii) reported that there have been some cases of misappropriation and diversion of user charges funds, causing projects to stall. This study confirms this view, since the large majority of the councillors and the Assembly officials interviewed said that user charges are a conduit of corruption.

The study observed that much of the money collected through user fees ends up in private wallets. It was noted that many officials ‘borrow the money on their own without the permission from higher authorities and they do not repay’ (interviews with Chief Executive). In other instances the Assembly officials share the money collected though user fees as allowances for a job they have not done or for workshops that never took place. Accounts personnel are also a problem. It was reported that they often do not issue receipts for services delivered under user fees and they pocket the money.

The study noted that accounts personnel also collect unauthorised fees. Not all services in the Assembly are subject to user fees. Some are supposed to be delivered free of charge, either because the fees for these services have not yet been approved or because the services are so socially desirable that it is unacceptable to exclude those who cannot pay the fees. But the availability of the user fees facility means that some accounting assistants take advantage of the peoples’ ignorance to charge even for the free services. The money thus collected mostly ends up in private wallets.

Moreover, interviewees claimed that users often paid more than required so that the services would be delivered quickly. They said the Assembly officials sometimes demanded bribes to carry out the tasks quickly. One official was quick to point out that:

we are pressed with work. We have too much work to do here. So if one wants us to help him within a day it is only kind of him to pay us something. The balance is only a token of appreciation for the job done. If they become stingy their files stay on the pile for ever. (Interview with Assembly Manager)

4.2.5 Public–private partnerships and corruption

The large majority of the councillors and Assembly officials said public–private partnerships provide opportunities and motivation for corruption. This view is in line with Meny's (2000:13) argument that corruption flourishes in sectors where the government and private sectors have some relationships.

The common trend, as revealed by the interviews, was that many private organisations would enter into partnerships to obtain favours from the Assembly when there was a contract. In these cases the partnerships are only set up as lines of communication to inform private organisations whenever there is a contract in the offing. In fact, some private organisations that are members of the network expect – and in some circumstances demand – that whenever there are contracts they should be given priority. One manager commented that ‘private organisations make phone calls to the Assembly and establish work relationships so that they can get contracts’ (interview with Assembly Manager). It was observed that some private organisations form partnerships with local assemblies so they can purchase state assets at below-market prices. This is mainly evident during public auctions. Some respondents mentioned an example where a private organisation in the network put pressure on the local Assembly to sell assets the organisation needed although the Assembly did not want to dispose of them.

In addition, public–private partnerships present opportunities for corruption as they bring in financial resources that may be easily diverted. This happens because in most cases there are no clear lines of accountability in the partnership dealings. Moreover, most of the money that private organisations offer to the local assemblies is only given out as gifts, with no stipulations as to how it should be used or accounted for. This exposes such funds to corruption. For instance, one official was convicted for stealing donations a private organisation made to the Assembly for repairing a road. Commenting on the case, one respondent said that ‘the official stole the money which a private company offered the Assembly through their partnership. The court found him guilty of theft by a person employed in the public service and convicted him accordingly’.

5. CONCLUDING REMARKS: A MOVE TOWARDS PUBLIC GOVERNANCE?

This paper has strongly suggested that, according to Local Government officials in interviews with the author, NPM reforms implemented in the Malawian local governance system have led to increased levels of corruption. To curb corruption, the study therefore recommends a move from NPM reforms to Public Governance reforms. The Public Governance model could effectively address problems of corruption in the Malawian Local Assemblies since ‘disciplining agents is the central task of the public governance’ (Frey, 2003:16). Moreover the model has built-in mechanisms that allow it ‘to process more information and take greater variety of values into account’ (Mayntz, 2003:2). These mechanisms work to fight corruption and close all possible avenues for it. Cloete (2000:24) and Bauer (2004a:18–19) agree that these values include, but are not limited to, the following: transparency, accountability, representivity, participation, equity, coherence and sustainability. Consequently, the Public Governance reforms are concerned with traditional values such as ‘equity, ethics, transparency and trust which go beyond the three “Es” of NPM (economy, efficiency and effectiveness)’ (Bauer, 2004b:6). This paper concludes by focusing on what Fuhr (2000:65) calls the ‘four key features’ or ‘building blocks’ of Public Governance: transparency, accountability, participation and predictability.

5.1 Transparency

Public Governance champions transparency in the running of public affairs. Interactive policy networks are introduced in the public sphere to ensure increased transparency. The Public Governance paradigm thus ensures that the administrators and politicians and other network actors are held to the task of administering rational operations in a transparent manner, impartially and objectively. In carrying out its functions and responsibilities, the authorities are to adopt a culture of openness and fairness. This openness is key to curbing corruption. Gildenhuys (1997) observes that secrecy always entails hiding something, and in most cases what is hidden is abuse of public resources. Public Governance champions disclosing and sharing information with all interested parties (Fuhr, 2000:67).

5.2 Accountability

Many authorities have directly connected the Public Governance model with accountability. Hill et al. refer to Public Governance as the ‘implementation of systems of accountability and control’ (2005:203). This means that accountability is at the ‘heart of (Public) Governance’ (Fuhr, 2000:65). Accountability entails being responsible to stakeholders for the quality of services, efficiency, sustainability, and so on. The model introduces a network of actors who are mutually accountable for their actions. They must account to the network members and citizens for the way public funds have been collected, kept safe and spent (Gildenhuys, 1997:36). Instances of corruption are thus minimised because there is a multiplicity of actors to check on the integrity of other network members.

5.3 Participation

Public Governance entails the active participation of all parties in public policy and service delivery. It focuses on participative democracy (Schout & Jordan, 2005:107). Extensive participation results in more trust and a culture of openness, which is instrumental in curbing corruption. The active participation of all stakeholders in the policy process minimises the risk of corruption in service delivery. From the earliest stages of policy identification, through to the formulation, design, implementation and evaluation of policy programmes, stakeholders are centrally positioned to articulate needs, help devise policy plans, and evaluate end results. This closes all possible avenues for corruption. The United Nations Association of Georgia (2000:1) agrees that ‘corruption is [a] social phenomenon and only through civil participation can it be solved’. Moreover, participation is central for effective implementation of accountability and transparency.

5.4 Predictability

Predictability means adherence to the rule of law. It encompasses ‘the laws and regulations, the processes through which they operate, and the institutions that apply them’ (Fuhr, 2000:65). Public Governance is about the rule of law. Kooiman (cited in Hill et al., 2005:203) stresses that Public Governance emphasises rules and good quality systems, and cooperation to enhance legitimacy and effectiveness.

Strict adherence to the rules of the game is instrumental for curbing corruption. In Public Governance, the network is bound by the set rules or codes of conduct that provide for acceptable ethical behaviour by all its members. This ensures that the required norms for network actors are predictable and instils the culture of openness and trust that is central to preventing corruption. Similarly, rules entail the formulation of disciplinary measures where those found guilty of corruption are exposed. This acts as a deterrent to financial misappropriation and diversion.

Notes

¹As the study was being concluded, Assemblies were dissolved, awaiting elections whose date had not yet been determined at the time of writing.