By Vilis Brukas, Swedish University of Agricultural
Sciences, Southern Swedish Forest Research
Centre
Forskarbloggen publishes an article that cause a media thriller in
Lithuania
Instead of introduction: a media thriller
In August 2009, the professional
journal “Baltijos Miskai ir Mediena” (Engl. Baltic Forests and Timber) accepted
the article “Reform for the country, not for bureaucracy”. Taking into account
the topic’s urgency, the text was placed on journal’s website on the day of
submission. Due to considerable length, we agreed that the paper will be
printed in two consequent issues of the journal. The first part came out in
September. Making use of the public management theory, it reviews the
prevailing models in the countries of the Baltic Sea region. The review
concludes that ecological and social needs are successfully fulfilled in almost
all countries, irrespective of management model. On the other hand, NPA model
is remarkably more effective than bureaucratic management, when it comes to
economic contribution to a State’s welfare.
The second part should have appeared
in the October issue, but the plan failed due to an unexpected media thriller.
The editorial office of the journal faced some threats “from above”. These were
not just empty words – the Director of the Journal was laid off. Besides, it
was explained that, in case the second part is published, the journal will be
“allowed” to get bankrupt. The outcome is understandable: the article
disappeared from the cyberspace, and the publication of the second part went
ashtray.
Having lived in the
Nordic countries for more than 10 years, I can hardly conceive this course of
events. If a similar suppression of media was attempted in Sweden, a public
turmoil could be expected, some involved rulers likely needing to depart their
posts. But in Lithuania, are such games by the powerful just a daily affair to
nobody’s surprise?
And
who are those rules with little discretion? The answer should be easy to spell
after reading the second part.
Part 1
After ideas about reforming State
forestry reached the Lithuanian Parliament and Government, a lively discussion
has been sparked in professional and popular media. A reform involves highly
complex and important considerations that do not only affect personal destinies
of employees, but also concern diverse group interests. No surprise that
emotions often prevail over facts and the latter are “corrected” towards a
desired direction. There is a lack of fundamental and neutral analyses; whilst
the theory of public management is a good point of departure for examining a
potential reform.
A little of public management theory
Already in the beginning of the 20th
century, sociologists identified an idealized model of a bureaucracy that
enables to seek certain goals defined by politicians. Bureaucratic management, also referred to as the traditional public
management, rests on the following core principles:
- Hierarchy, i.e. an administration relies
on a strict subordination of the personnel. Officers of a lower rank sternly
obey to the officers of higher ranks. This principle ensures that the decisions
of the top leadership are implemented throughout the organization.
- Functional specialization. The tasks
and the means for their achievement are standardised according to positions,
areas of responsibility are defined in respective statutes. Forestry
administration can be specialised geographically as well as according to
functions performed.
Characteristically, the bureaucratic
system of management relies on loyal employees who carry out their functions,
neatly following instructions and having little freedom of choice. The
bureaucratic model is often criticised due to, among other things, lack of
flexibility and suppression of employees’ initiative. Bureaucratic
organisations often turn into entities that are difficult to regulate
externally. Sometimes they even become kind of manors or protectorates of the
leading officers, where diverse personal and factional interests end up in deep
clashes with those of the public.
Efforts to improve the traditional
management led to the concept of New Public Administration (NPA) that, since
1990s, has become the prevailing model for administrative reforms in developed
countries. NPA is oriented towards efficiency and is expected to result in:
diminishing bureaucracy; inclusion of market mechanisms into public
administration; increasing productivity; greater independence of employees, and
better service for clients. The management is decentralised along with
implementation of new devices for accountability and control.
Reforms might be initiated to
genuinely improve the public management, increasing its contribution to a
country’s welfare. There might also be hidden agendas, for example, certain
grouping may try to push through privatisation without taking any political
responsibility. Sometimes reforms are imitated without any tangible changes and
trying to retain the “inherent” privileges. Policy science stresses that the
success of public administration to a high degree depends on both, the overall
political culture, as well as personal ethics and responsibility. The
experience of post-Soviet countries confirms that, in the context of a
deeply-rooted bureaucracy and corruption, it is difficult to carry out essential
reforms for the benefit of society.
Features of public administration in neighbouring countries
In reality it is hardly possible to
find a forestry administration that would be organised purely according to the
bureaucratic or the NPA model. Elements of both models are more likely to be
observed. However, it is possible to conduct a comparative analysis revealing
which model’s features are prevailing in one or another country. NPA principles
are well established in the Scandinavian countries, not only in forestry but in
public management at large. A high regard is given to employee’s initiative and
independence, tendencies of decentralisation are prevalent over several last
decades. The legal environment in Finland and Sweden traditionally is liberal,
State forest enterprises are oriented towards efficient and profitable
management.
Our Baltic neighbours Latvia and
Estonia carried out radical reforms in 1999-2000, with clear reorientation from
bureaucratic model to NPA. Forest management and policy-making functions were
clearly separated at all levels, a single State forest enterprise was formed in
each country with a clear mandate to work efficiently. A radical reform always
entails numerous challenges. Despite this, the newly established enterprises
surprisingly rapidly raised their profits as well as contributions to State
budgets. Notably, the enterprises have been structurally organised into
divisions by main functions, such as forest management, seed and plant
production, nature management, timber trade and marketing, and hunting
management. Each division has clear targets of performance; at the same time,
they have sufficient operational freedom.
As far as I am acquainted with
others countries of the ex-Soviet space, State forestry administration was not
reformed (e.g. in Ukraine) or the reforms were deficient, creating an
institutional chaos and dissatisfaction by majority of employees (Russia). In
these countries, private forest ownership is either illegitimate or
insubstantial, while State forestry is steered by profoundly bureaucratic and
ineffective administrations. One of their characteristic features is
flourishing corruption.
Command style of administration is
clearly dominant also in the Polish State forestry. The administrative set-up
practically remained unchanged from the socialist times, policy-making and
forest management being integrated within one organisation. This is a powerful
“State within State”, guided by the principle of self-sufficiency and not
providing any noticeable contribution to the State budget. Within this highly
hierarchic organisation, the loyalty is a much greater virtue than independence
and initiative, all core activities are based on detailed regulations. Recently
conducted international survey of young forest specialists brought forward a
notable dissatisfaction by a considerable share of the Polish respondents. The
employment and advancement on the career ladder depends on employee’s personal
contacts (not rarely via family bonds) rather than on her/his competence and
productivity. Hierarchic relationships and normative management is detrimental
for people’s motivation and initiative.
In Germany, the cradle of the
classical forestry, management and policy functions are integrated in the
administrations of federal lands (Bundesländer). In time of its heights, the
bureaucratic model was well-advanced and considered to be exemplary by many
other nations. Nonetheless, State forestry has been infective and needed
sizeable subsidies already for several decades. One could expect that, taking
into account the highly developed economy, high population density and
negligible share of forestry in the State’s GDP, subsidising could turn into a
politically accepted norm. However, the current federal government seeks to
improve the effectiveness of forestry administrations and reduce the
bureaucracy, relying on NPA principles. It is worth mentioning, the Germany’s
neighbour Austria State forestry is a profitable venture. Once again, this was
achieved due to reorganisation of State forestry according to tenets of NPA. A
single State enterprise, stock company “Austrian Federal Forests” was
established in 1997.
How does one or the other model
affect the welfare of the country and its citizens? Does it satisfy, as
currently is fashionable to say, the public interests? In the forestry context,
the public interests can be traditionally divided into ecological, social and
economic. As regards ecological and social needs, it is safe to claim that the
countries of the Baltic Sea region are satisfying them quite successfully. The
only exception with some reservations is Russia. In the latter, large forest
areas are not utilised, some other forests are overutilised, their regeneration
is insufficient and of bad quality. All other aforementioned countries pursue
principles of sustainability, in theory as well as in practice. Forest areas
are increasing, cuttings are considerably below the increment, the network of
protected areas is quite elaborate and is being further expanded, increasing
attention is devoted for silvicultural measures for enhancing biodiversity.
Assessing at large, it is not possible to observe any correlation between the
model of forest administration and the social and environmental performance.
On the other hand, there is a clear
connection between the management model and the contribution to the economic
welfare. In countries with prevailing bureaucratic model, State forestry
usually relies on self-sufficiency, i.e. forestry’s contribution to the State
budget is absent or negligible. In other words, a huge resource of a country is
used by the State forestry institutions “free of charge”. Such wasting of
resources is hardly justifiable, especially in the countries that face the
difficulties of the period of economic and social transition.
Part 2
Management model in Lithuania
After re-establishing the
Independence, the socioeconomic environment changed radically. After transition
to the market economy, State Forest Enterprises (SFEs) had to learn to work
independently. Timber processing units were gradually dismantled, but
enterprises remained in charge of the whole forest management cycle from seed
to forest logging. Considerable share of activities, especially logging and
planting, was contracted to private companies. The average area of forest under
management of an SFE was halved due to forest restitutions and currently makes
up around 20,000 ha (totally there are 42 SFEs). At large, SFEs activity during
the first years of Independence can be assessed positively. In times of rapid
economic transition accompanied by privatisation that at times was dirty and
predatory, SFEs ensured stability and sustainable forest management, more or
less successfully adapting to operations under market conditions. Then again,
the economic model was based on the self-sufficiency and the major share of
revenues stayed within the forestry branch, with little contribution to the
State.
The chosen “evolutionary” path has
conserved the institutional set-up. The economic and social environment changed
radically, while the internally State forestry administration avoided any
substantial changes. The most visible reform was the establishment of the
Directorate General of State Forests (DGSF) in 1996, in order to separate
functions of forest management and policy-making. The goal is commendable but
its pursuance was quite unfortunate. First, this decision was taken in hurry,
on the onset of change of governing coalition, during the last days of the
existence of the Ministry of Forestry, without any deeper analysis or
consultations with representatives of the sector. This was one of the reasons
for the ongoing conflicts between DGSF and the Forest Department under the
Ministry of Environment. Even worse, there were no systemic prerequisites for a
more effective management. DGSF simply became a kind of SFEs’ penthouse with a
foggy mission of coordinating the SFEs activities. The nature of the reform and
the mentality of its implementers predestined a predominantly bureaucratic
profile of DGSF, with the increasingly obvious role of SFEs’ controller.
It needs to be mentioned that, in
addition to DGSF establishment, there have been some alterations of the ministerial
subordination and the status of SFEs. However, these alterations did not bring
about any significant changes in the administrative set-up or in activities of
SFEs. Although SFEs have a status of a State enterprise since 2001, their legal
rights are considerably curbed at the expense of DGSF. The latter does not have
a status of an enterprise but it takes over part of SFEs’ rights without taking
on clear responsibilities.
One can claim that the persons in
charge missed a good chance for carrying out a rational reform of forestry,
following the NPA tenets. It is obvious that the current administration and
especially its top entities match most features of the bureaucratic model:
-
The
management system lacks internal incentives for rationalising its performance,
seeking more efficient use of resources and attaining higher contribution to
the country’s welfare. Activities are steered by command management and
short-term conjunctures rather than by a clear vision for development of the
sector.
-
Forest
management activities are base on petty regulation, different kinds of plans,
norms, detailed and compulsory provisions for people at SFEs, as if there is no
trust in their professional competence. This is a core issue of forestry,
conditioned by the bureaucratic model of the administration.
-
Coordination
of SFEs’ activities by GDSF is the most authentic example of a command-based
public administration. For example, there are lists of information that has be
presented on the websites of SFEs. Much manpower is wasted on all kind of reporting,
audits, etc. One of newer and more exciting examples: each SFE to report to
GDSF on public outreach activities and publications in the national media every
three months.
-
Loyalty
is valued more than competence and results of work. Even though the performance
of a single SFE to a large degree depends on the competency of its director,
there is no evidence that GDSF would effectively use its right to assign SFE
directors with due consideration of their competence.
-
Innovations
are coming slowly, for example, the level of IT applications are quite low at
some SFEs.
-
In
informal conversations, a significant share of employees of lower ranks express
discontent with the current situation. Their motivation is restrained by the
excessive bureaucracy that, among other things, leads to increasing workload.
Despite heated discussion on the reform, such opinions are rarely reflected in
the public space. Even the long-standing professional journal “Musu Girios” is
short of critical contributions and generation of ideas, in contrast with the
pre-war traditions and partly even the Soviet era. These could be indications
of lacking freedom of expression.
Finally, the GDSF itself officially
maintains the position that forestry administration should be organised by
example of Poland. This confirms the value orientation towards further
bureaucratisation.
SFEs’ directors and other staff have
ended up in a weird situation. Working under market conditions, they should at
the same time fight against windmills of bureaucracy or become faceless screws
of the administrative machinery.
Future alternatives
Assessing the situation at large,
two major scenarios may be envisioned for improving the State forestry
administration:
“A” scenario: To retain current
administrative set-up but diminishing the bureaucracy, first of all by
decreasing the influence of the central bureaucratic apparatus on SFEs.
“B” scenario: To carry out a radical
systemic reform, applying NPA tenets.
“A” would be a minimalistic scenario
that would not bring about substantial changes but still create prerequisites
for more independent work by the main forest management subjects, the SFEs.
Less manpower would be required for the bureaucratic routine. Both the policy
science theory and the practical experience of the Lithuanian reforms are
showing that the already existing organisations attempt to preserve the status quo by all means. Any
organisation attempts to increase its power and resist the external pressure
for reform. Thus, in the overall context of deeply bureaucratised public
management, Scenario “A” would easier break trough the hindrances that are
being continuously erected by influential interest groups.
Scenario “B” is more difficult to
implement, but would bring more benefits for the State. Taking into account experience
by countries in our region, it would be rational to establish one enterprise.
Its form could be a stock company whose shares are owned by the State. The
enterprise would be responsible for management of State forests on all levels
with a clearly defined mission to work efficiently, providing sustained
ecological, social and economic contribution to the State’s welfare and having
in place an adequate management structure and principles. The policy-making and
control functions could be performed by a consolidated State forest service
that could assume supervision of both State and private forestry.
Under various occasions, the
opponents of the reform have argued that establishment of one enterprise will
create a monopoly, the country will be overwhelmed by the Scandinavian capital,
State forestry will be privatised by forest industries, etc. It is hard to say
whether these are the real fears or just frightening of the less informed people.
Already in 2006, a scientific report from the Lithuanian University of
Agriculture pointed out that SFEs are not sufficiently large to balance out the
influence of the largest timber processing companies on the market. In
addition, a monopolisation of the whole forestry branch is simply impossible
due to private forestry that is gradually gaining in strength. I would not see
a “severe problem” if a foreign capital would be invested in Lithuania under
conditions that are favourable for the country. However, I cannot grasp how the
new enterprise would condition a sudden inflow of the foreign capital. In
Latvia, the course of events was opposite. Before the reform, a part of State
forests were leased to foreign companies under excessively benevolent
conditions. When the stock company “Latvian State Forests” was established in
2000, such leasing was immediately ceased. Meanwhile some Lithuanian media
feature disinformation, as if the reform in Latvia was made to satisfy the
Scandinavian interests.
One could be more wary of domestic
industrial groups, particularly, when recalling the quite cheeky attempts to
introduce timber quotas under “special” pricing in the last year. To this end, backstairs
influences and corruption can be avoided if the reform is carried out
transparently. After enterprise is established, its resistance against such
influences primarily would depend on the professionalism and ethics by its
leadership. The same is of course valid for the current GDSF and SFEs.
I have no doubts that a strong and
NPA-alligned State forestry would bring a sustained long-term contribution to
the country’s welfare, at the same time ensuring good working conditions for
its workforce. Therefore the employees of the current SFEs should not be afraid
of a radical reform. Competent and diligent specialists would certainly be
needed for the new enterprise.
What about the alternatives that
have been lately discussed officially? Confer the following citation from the
legal decision by the Committee on Environment Protection of the Lithuanian
Parliament (Seimas):
After debating, it was decided by a
common agreement to suggest to the Government:
-
Without
radical rearrangements and changes of the current legal status of State forest
enterprises and the set-up of forestry administration, to enact provisions in
the Forest Law, the State and Municipal Enterprise Law and other legal acts,
enabling the transfer of part of revenues (3%) of State forest enterprises and
part of their functions related to organisation of the timber trade and human
management to the Directorate General of State Forests;
[…]
-
To
enact the provision that attestations of State forest enterprises are carried
out every five years, taking into account the results of auditing, and to
legally define the criteria of evaluation
After getting acquainted with the
actual public discussion in the parliamentary committee, such text of the decision is
astonishing. Was it formulated by members of the committee, or just copied from
the drafts by GDSF? Assessing according to the theory and practice of NPA, the
suggested alternative would be a big step backwards. The partial transfer of
functions to GDSF would further reinforce the bureaucratic penthouse, while
SFEs would be pressed even more, adding five-year attestation to the already
ample provisions, audits and reporting. The suggestion to reinstate the Soviet
practice of a centralized forest fund sounds particularly socialistic. According
to representatives of GDSF, part of the fund’s assets would be utilized to even
out the revenues of SFEs due to difference in forest management conditions.
Such egalitarian measure might sound nice ideologically but in practice it
incites hidings of revenues and diminishes motivation to work effectively. And
where are the guarantees that, in addition to the management conditions, the
loyalty to GDSF’s leadership will not become an important criterion?
It is rather difficult to evaluate other suggested alternatives
as the discussion is focused on the desired number of SFEs. One cannot disagree
with scientists stating that the area of an SFE is an important factor as it
comes to the efficiency of management. Unfortunately, the subject of the
management model usually evades the discussions. In my opinion, the size of an
SFE is an important but secondary issue. It is possible to establish one
enterprise by changing the facade but without essential changes in the administrative
system. One can expect a corresponding result: one ineffectively functioning
enterprise. The reform must be essential and well prepared. Otherwise it is not
worth wasting effort and bothering the people.
I wish to encourage foresters of all
management levels to be active, express their opinions and defend their civic
position in the media. Everybody has the right to submit proposals for
improvements of the State forestry administration to the Governmental Sunset
Commission, every input is important for shaping the common professional
future. Those in charge of the reform need to listen not only to foresters, but
also to the people independent from the current administration, including
lawyers, policy scientists, economists, biologists, representatives of
non-governmental organisations experts of timber industry and other areas.
In the end, the outcome of the reform will depend on politicians in the
Government, Parliament, and President’s office. We can only hope that the final
decisions will be shaped by those for whom the country’s welfare is more
important than some political fraternities. If not, we can await one more
sunset of a reform with regrettable results.
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