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EITI and public administration efficiency

11 November 2013

One of the reasons why governments are struggling to become transparent, is their lack of public administration efficiency. I am sure I am not the only one who travels from country to country in Africa engaging with civil servants and sensing a very honest interest in becoming more efficient in their work. But the tools are not readily available, and the path to improving administration seems full of endless challenges.

While the EITI stakeholder groups have done a great job in creating international standards and uncovering the weaknesses of current systems, they have had little to offer civil servants, other than putting pressure and raising red flags. The EITI process is a diagnostic toolkit for stakeholders. Should we not also develop tools for public administrators?

In Sierra Leone, despite its EITI suspension, I believe we have learnt some very valuable lessons in this regard. The government has been using our Mining Concessions Administration System (MCAS) since 2011, now managed by the National Minerals Agency. All mining licenses are processed in this system, and payments are recorded with scanned documentation. All the licenses and payments are regularly published for the public on the GoSL Online Repository, launched officially by the Minister in January 2012. Further on, we have integrated the system with all tax and customs payments from the National Revenue Authority, so the repository now shows complete revenues from mining companies across all EITI payment types. 

As you can imagine this exercise dis not run silky smooth, but the challenges have taught us some valuable lessons:

1. Investors and mining companies, rather than stakeholders, are the primary users of the public data for their decision-making and due diligence purposes.

At the launch in January 2012 we expected journalists and civil societies to dig up all kinds of scandals from the enormous amounts of new data published. That did not happen. Why? First of all, the data is coming directly from the public administration system, and the public can go to the mining cadastre office to verify, correct and inquire any of the information.  I think the data was solid enough for any major corrections to be detected. Secondly, analysing the data requires a good understanding of how the mining sector works. Thirdly, it is really the investors and license holders that are the government’s client for this service, and hence improving service delivery meant better communication with this group.

2. Government, rather than stakeholders, are using the repository as a compliance enforcement tool.

With all license information made public, mining companies have to be careful to manage their appearance to the investor community. No mining company will get investments if the repository suggests that your license is suspended, and poorly maintained licenses are easy to identify. Government now finally have an enforcement tool to mining companies that do not respond to letters, and are nowhere to be found at their temporary office location. In Sierra Leone, not fulfilling your reporting obligations to the EITI process have had direct and visible consequences for several companies lately.

3. The EITI Secretariat and stakeholder groups continue to follow a paper-reporting reconciliation process, and have difficulty accepting a computerized system.

In order to facilitate data sharing and trouble shooting on payments records from the extractives sector, the Government of Sierra Leone established an Extractives Industries Revenue Task Force (EIRTF), consisting of the key government institutions involved (Ministry of Finance, Ministry of Mineral Resources, National Revenue Authority, etc). Every other week, the group meets to discuss issues with specific payments. MCAS and other systems produce digital data reports with all payment records down to receipt number. It has however been difficult to convince EITI to use the data from the EIRTF, rather than go through its standard EITI paper reporting process. At what point do we audit the public administration computerized system and its data, rather than separately collect data on paper forms? 

EITI discussants are now engaged in trying to find ways in which EITI data can be more useful. I believe the reason why it is so hard to make it useful, is because it is collected separately from the public administration systems. It only gives a diagnostic picture of key aggregated data a year or two ago, and hence it may disappoint a lot of EITI enthusiasts that the data will actually never be used extensively. We need to get to the stage where data is published directly from the public administration systems in order to have a useful accountability loop directly with the civil servants managing your payment record. And it should be auditable and recent, at least on a three month basis. We have proven it is doable. I believe now is the time for EITI to adopt a data exchange standard that facilitates government data integration and transparency. We would like to propose using our experience as a basis.

Aasmund Andersen is a managing advisor at Revenue Development Foundation, an organisation that works to enhance revenue for low-income countries.

Sierra Leone