Interview of Mr. Tigran Grigoryan, MAS Senior Consultant at Ameria Group, to ArmInfo News Agency

Recognized Armenian experts in governance and management declare that Armenia is facing the crisis of public administration system. Do you share this viewpoint? In your opinion, how efficient is the public administration system in Armenia?

The public administration system in Armenia is currently undergoing reforms. While the first-generation reforms are already over, second-generation reforms are still in progress. The first reforms were initiated to implement a public administration system in general, while current reforms are aimed to improve the effective administration system and increase its efficiency.

Do you consider the first stage successful?

Well, in my opinion, the first-generation reforms may be considered successfully finalized despite a number of shortcomings. I'd like to note that the first-generation reforms were strongly supported, both financially and technically, by international institutions, such as the World Bank, European Union, IFC, EBRD, etc. We have the same situation now with all these institutions actively supporting Armenia in implementation of the second-generation reforms. It is not always, though, that the Government agencies use the suggested assistance and if they do, they may imbed it into the practices only partially.

What is characteristic of the second stage of reforms is that the local authorities work in close cooperation with international institutions which points out their serious intentions of constructive negotiations.

So can the current reforms be already described as efficient?

Before I answer your question, I'd like to clarify that the efficiency level depends on the ability to achieve the desired results at lower costs and resources. So the less resources have been invested into the final result, the higher is efficiency level. For example, in its rudimentary stage the Civil Service in Armenia was pretty large-scale and overstaffed, although its performance was not always efficient. Now we have the opposite process with the public administration system being improved through cutting of civil service staff, like in many other developed and developing countries. For improvement of the overall and HR structure, this process, in addition to reduction of extra staff, should also involve automation of business processes.

So, with all these considerations in mind, I think that the Armenian public administration system is not quite efficient yet.

Which are the weak points?

Let's start with the legal framework. Having incorporated international norms of regulation in public administration sector, it's rather developed in Armenia which is confirmed by international experts, too. However, it still needs improvements and new infrastructure with completely new mechanisms of operation. We need to reform some operating Government bodies, increase the efficiency of business processes and overcome the low effectiveness of qualified HR identification and selection system.

What do you mean by 'low effectiveness of qualified HR identification and selection system'? How would you handle this issue?

The civil service staff selection system in Armenia was established in 2001 and since then the recruitment has been based upon two-phased competition: a test and an interview. The experience shows, however, that both mechanisms are not much effective. The testing and the interviewing methods fail to identify all the skills a person has. For example, the applicants are not given situation-based tasks where they could demonstrate their critical thinking skills. In other words, this method employs more theory-related rather than practice-related tasks.

In 2008, the Armenian Government embarked on a new stage of tax and customs reform, as well as restructuring of the tax and customs services as part of these reforms. In your opinion, is the pace of the reforms satisfactory? Do they facilitate doing business?

As regards tax administration, the reforms are progressing at a snail's pace with little effect. There are some positive results, though, like implementation of one-stop shop principle. It facilitates and speeds up service of taxpayers and minimizes communication with tax officers. Though this principle has been already employed in some territorial subdivisions of the State Revenues Committee, some serious activities should be carried out to make it a common feature.

Another constructive change is use of e-invoices. Many entities have already benefited from the new system and their feedback is positive.

Can we draw an analogy between public administration systems in Armenia and other ex-Soviet countries? Is it a relevant thing to do?

Any public administration system is specific, so I wouldn't like to compare them. The public administration system in any country, whether developed or not, has both pros and cons. According to the WBI Worldwide Governance Indicators research, Armenia has strengthened its position in Governance Effectiveness (31.7 in 2000, 52.2 in 2005, and 49.8 in 2010) despite the decrease in this index over the past year.

It is also important to keep in mind that the governance system is not static. On the contrary, there is usually a gradual natural shift from one condition into another. Such development is called evolutionary and Armenia is in the mid-stage of this development.

What role do advisory firms play in the public administration reform process?

Ameria and many other advisory firms, both local and international, are actively involved in public administration reforms meaning that they develop and implement various projects, share with the local civil servants their experience in governance, development of legal norms, structured reforms, HR management, etc. These projects are implemented in close cooperation with the beneficiary agencies. Implementation of the projects initiated to improve the public administration system could be an uphill task without participation of advisory firms. It doesn't mean that our civil servants are not able to carry out the projects by their own means, without assistance of advisory firms. First, there would be many constraints because they have other tasks to handle too. Second, it is a common approach that involvement of international experts helps to reveal intrinsic problems more efficiently. Usually the outsiders see things more clearly.

There is an opposite opinion that local experts are more adept at understanding the internal problems, their causes and finding solutions...

That is why the projects aimed to improve the public administration system are implemented in close cooperation of local and international companies and the clients.

Would you tell us about the projects implemented by your firm?

Quite recently we have completed a very serious project aimed to improve business processes in seven Government ministries and agencies (Ministry of Agriculture, Ministry of Finance, Ministry of Culture, Ministry of Education and Science, Ministry of Health, Ministry of Transport and Communication and the Republic of Armenia Government Staff). Prior to it, we conducted a thorough analysis of the legal framework and the business processes at the ministries only after which we could recommend tailored solutions and most efficient schemes of business processes.

Apart from this, our firm was contracted to design a development strategy for the civil service system. We conducted a thorough analysis of the sector and presented a package of recommendations. Ameria completed and is still involved in development projects for many sectors, including governance reforms in a number of industries (transport, ecology, export promotion, social sector, etc.).

What challenges have you revealed during the analysis?

We came across a number of problems. First, mismatching in the legal framework, which held us back from more effective work. That is why what we did first was elaborating recommendations on the improvement of the legal framework. Then we developed most appropriate business processes starting from strategic planning and ending with such trivial issues like efficient correspondence.

By ArmInfo News Agency