Client_Orientation_as_the_Device_for_the_Increasing

Introduction Bureaucratic paradigm by the nature does not give room for the “customer orientation”. (I am later explaining, why I am using quotes.) An official inside bureaucracy should serve his superior and be responsible to him. Rules and regulations defining his actions are expected (at the best) to reflect public will and citizens needs indirectly. Therefore improving “customer service” is considered as supplementary and recourse consuming obligation, imposed by politicians. Introduction of feasible and effective devices of “customer orientation” is presuming changes of basic PA paradigms. I am focusing firstly on main reasons of changes that can better explain basic strategies of modernisation aimed to reduce the gap between government and citizen. The development of post-war welfare state should not be treated purely as an accumulation and increase of welfare and, its crisis, consequently as the point, where the process has reached physical and financial limits. The basic reason of crisis was rooted in the internal logic of traditional government and public organisations. They were per se inward looking and were not suited to follow rapid changes in their environment. At the previous stage of development the public organisations were able to neutralise market failures, because services and goods were relatively standartized and simple; their characteristic were quite stable. In 1960-s essential shift in the citizens’ basic needs took place, that presumed more complex, more diversified (or individualised) services and goods. Basic justification of service delivery by public organisations – their ability to reduce transaction costs – became redundant: attempts to meet increasing citizens’ demands by traditional organisation rapidly increased their costs without obvious improvement of their quality. So, the simplest solution was offered – let get these services back to the market, that would rise the efficiency and transparency of the use of (public) money. The shift, however, was much deeper. Privatisation and market mechanisms might reduced the excessive amount of public assets. The exchange of some modernised goods and services, as well as the increase of public awareness, did not produced more market failures. However, the general amount of public goods and services by their nature did not reduced, but even increased. Attempts to cut the rate of government expenditures in the GNP did not succeed. So the essential reinventing of principles of administration was obvious. There have need also other reason of the revolution in the PA. The development of civil society has created new generation of individuals with new values. They were not more ready motivated to act efficiently in the framework of hierarchical and depersonalised organisational forms (1) and also not to be only as subject in relations with the government organisation, either as having obligations (the question “for what” aroused) or to be grateful for the benefits the government found he/she has deserved to have. I think the new-right liberal idea of minimal state was the first, but a negative reaction to that new roles. More sophisticated organisations, especially adaptive to the changes in environment and in motivating staff, have emerged. Organisations, functioning as natural and/or open systems, changed substantially the traditional image of boundaries and internal life of these organisations. (2) Opposition between people who are managing and one’s who are managed has blurred. Contrary to the apprehensions that this tendency 3 could result in mismanagement, organisations became more efficient and responsive to the organisation’s environment. Gradually the conviction of applicability of these new organisational forms also in the public sector strengthened. The new level of human needs blurred also quite strict boundaries between state and individual. Democracy, self-actualisation and realisation of an individual lost its formal connotation and became a real device of truly public governance. They are more eager “to be” and less valuing its role only as customer and “to have”. When E. Fromm in his “Escape from Freedom” presented this controversy, the question “to be” was important only for some groups of intellectuals. Currently this dichotomy very figuratively is reflecting the essence in the government shift. 1. Basic values and approaches to the improvement of government – citizens relations. During 1980-s and early 1990-s Western countries have developed various national strategies of PAR, departing from the different values and principles in improving government – citizens relations. Partly this variations are explained by the specific of administrative culture; partly they emerged from the different understanding of priorities. (3) The first. Government as the monopoly service deliverer is imposing goods and services with inappropriate high costs and is trying to define (departing from one’s interests) what a citizen should get from government. Hence, citizen should have choice to determine what service or good is most compatible to his/ her needs, with acceptable ratio of quality and quantity. The issue is balancing the bargaining power of citizen in government (supplier) – citizen (receiver) interplay. The introduction of competition (or market-type mechanisms) is the easiest and cheapest way to balance them. Taxpayers have an opportunity to vote by legs or to turn towards the private (or competitive) sector. This is a priori the customer approach. It had got impressive results, but also resulted in substantial failures to meet initial ends. Introduction of market principles would be very useful for reverse obvious deformation of traditional welfare approach. However, to achieve ends of improving government – citizens relations, is seems quite risky to rely solely on that paradigm. (4) The second, is based on the apprehension, that government organisations are too far from citizens and to not knew enough of about their actual needs. One of this need is self-realisation and self-determination. Hence, citizens should have more opportunity to participate in government decision making (a) what service is the most appropriate and (b) how to deliver it. Here the basic principle of traditional bureaucracy is undermined: civil servant must be not responsible to the superior but to the decisions, made by community. How in that case could behave ordinary civil servant' Looking peacefully to the loss of one’s power to be in command and accepting the perspective to have responsibility mandate from citizens instead of being responsive to politicians. (5) This approach has put emphasise on the citizens and client orientation. 4 The third warning is that government is too regulations-bounded and subject to rules even civil servants do not find rational. As the result, an official have neither necessary flexibility to meet changing needs of individual and the procedure of service delivery is so complicated, that even personal commitments to deliver best service would die, faced with time-consuming and too complicated for citizens rules to follow, before becoming eligible. As a result, the amount of rules should be substantially diminished. There are two basic strategies, dependent on the nature of good or service. The first. Discretion and responsibility for service delivery should be put on the line manager who is responsible to citizens. This version is very much conducive to the NPM and to the management principles compatible to the open system’ organisation. The other remedy, however, is the functional structuration: installing the balance between service provider and client inside the government hierarchy (through the separation of responsibilities and discretion) for funding, purchasing and provision. (5) Instead of strict and complex rules performance contracts as convention on mutual obligations, would became as the basis for guiding activities. Here the emphasise is put on the changes of internal structural configuration that would make devices of responsibility substantially efficient, and would create the triangle (or quadrangle) where intentions of customer and government official would coincide. The second strategy is the increasing transparency of rules, after the both: citizen and official can check exact amount of rights and obligations without suspect, that rules may be not so complicated and official has done all according the rules. And vice versa, citizens may have clear vision, what kind of service he/she has right to receive and under what preconditions. The fourth warning is that government organisations are too inflexible and they are not able to change themselves to be capable to meet changing needs of different constituencies. Organisational diversity and openness would be the best remedy for overcoming this deficiency. This approach is, however susceptive to the NPM. It is relying on the idea of decentralisation and establishing network government. Gaebler& Osborn gave the figurative definition (“steering, not rowing”) to this approach. In spite of common points of departure, I am considering some substantial difference between the second and the fourth paradigm. In the former the participation is considered as the democratic device of settling issues, concerning the government – individual relations. The fourth approach has put emphasise on the principle “do it themselves”, where the government is taking a stance to mediate actors, i.e. relying on the corporatist policy paradigm. Therefore this paradigm is giving preference to the strengthening client’s role and is more committed to the values of social justice and social efficiency. 2. Dimensions of government – citizen’s relations There have been yet several basic shortcomings in shaping the theoretical analysis as well as practical programs of customer orientation. The first is a vague definition of constituencies that would be termed as citizens. Citizen has been often treated as an abstract person or specific target group waiting for the benefit from the government. The other dimension is often neglected. Government is providing various types of services. Every type, however, is presuming quite different set of relations between government and individual or groups. That means, ”good governance” is presuming rather different devices to achieve the best congruence between individual’s expectations and government (official’s) intentions. That means, an organisations should have several 5 supplementary strategies and management devices, and what is more important (as we see below) also very careful strategy to balance these approaches. Otherwise, the “customer orientation” would enhance the amount of goods, but could not be conducive to real results, i.e. on the balancing citizens expectations and government capacities to meet these expectations. That was a reason, why traditional bureaucratic organisations, applying in different areas and cases the same procedures of conduct, was forced to make supplementary efforts (and expenditures) to meet more or less the diversified demands of individuals. (Or these efforts remained purely formal.) The second, customer orientation is often considered as the one-way relationship, where imperfect government or official is not able or not willing to meet appropriately individual’s expectations that are per se adequate. “Client is the king”, but is should be added not capricious but enlightened king with high sense of knowledge and responsibility. Individual should have some responsibilities to became eligible for service or good. Individual’s real needs, related to his/her activities on other areas of everyday life, should also be transparent. Parents could be dissatisfied with the low grades of their child, but these grades are not dependent only on the teachers teaching skills but also on the atmosphere in the family, on parents way of conduct etc. So, especially in case of human services, the quality of outcome is substantially dependent on both sides, and as we see below, citizen – government relations may embrace much complicated network of social relations than face-to-face intercourse. Therefore also different, in comparison with traditional, devices in establishing their relations should be developed. Also the other dimension of differences is important for the analysis of government – individual relationships. Different roles of government and individual may be determined by the nature of service and the need to be satisfied. I.e. the variation is caused by the exchange of different goods between the government and individual. Here one would develop the customer strategy towards the basic target groups. For instance, issuing passport is completely different good as compared with the issuing business license, in spite the need (to get the document) and actions (bureaucratic paperwork) are quite similar. The difference, between community care and police actions is, of course so obvious, that the issue of different “customer strategies” could not be even discussed. Here the differentiation of constituencies as well as devices and procedures of service (or service standards) is quite simple and various strategies are easy to work out. The same individual is, however, often playing simultaneously different roles and government agency should may be forced to establish different service standards of “good governance” for the same service to various individuals to balance the customer strategy. I.e. actually the government agency should deliver simultaneously complex services to one individual. What is most important, different roles of individuals in relation to the government office are very often simultaneously controversial. At this point the strategic purpose of government – citizen relations became clear: it should not only balance interests of these various constituencies and roles, but to adapt its services in individual cases to avoid the conflict of its actions towards the same individual (subject). 6 This a bit speculative deliberation could be examplified with the case of correction services. Prisoner is customer of prison dining-service and in case this is not acceptable for him, he/she could prefer private menu. (In CEE countries, this is however, a theoretical case.) He/she is subject to follow quite strict rules and simultaneously, as citizen has quite clear rights, that should not be violated. (These two roles are in most cases interconnected also out of prisons.) In practice, fulfilling appropriately the first role by “customer” should result in the government officials actions in defining appropriate rights to prisoners as citizen’s. Different regime of prisons has been applied. But where is the borderline, the limitation or widening of rights (as the consequence of not following/ or following one’s obligations as subject) is transforming into the violation of rights' Besides, OCES is currently very strictly monitoring in CEE countries: how the balance of subject – citizen (prisoner) roles is followed in the justice system in general and by the national correction services in particular. However, the interests of other constituencies are not under consideration. Is there the abolition of death penalty and applying short times of imprisonment in congruence with the rights of general public to have appropriate degree of security of life and property' Or what is about the victims and their families as citizens, but also as clients to receive psychological support or special treatment as disabled victim' If the balance of interests of other constituencies is not followed, the improvement of government citizen relations in one dimension would result in their alienation in the other dimension. This, however is subject of the other study. The third set of arguments is grounded on the need to apply rational choice approach to issue to reduce the controversy, inherent to the very idea of government bureaucracy. Very often government organisation is considered as policy responsive body without its own interests. But by the definition of bureaucracy, the civil service could not be responsive to the citizens but to the superior and rules. Besides an organisation is acting in real life as interest bounded and nobody could impose to it the task to follow the citizens need, unless the organisation do not conceive the rationale of this approach for its own needs. At least to be rewarded for the quality of the customer orientation. Otherwise the call for improvement of customer orientation would (and in reality has) remain in the sphere of moral assessments or ritual statements, politicians could exploit during their electoral campaigns. Therefore, in achieving real progress in government-citizens dimension the question should be put in another way: what are those devices of citizen’s orientation that would be considered by government organisation as incentive to follow this orientation' To get answer we must analyse the first issue: structure and roles of those government is serving. Here one cannot find better reference that H. Minzberg essay. (6) H. Minzberg defined four types of government–individual relations with substantially varying roles of both: customer, client, citizen and subject. A Customer is an individual receiving from the government simpler goods or services for individual consumption. Their relations are not permanent and will end after the exchange is finished. Here the exchange is de-individualised and goods or services may be highly standardised. These services could be subjected to the market testing in different ways. As soon as government official could is behaving as the 7 monopoly supplier, the delivery of goods may became too much dependent on the government official. (Losses from the mistreatment and lower quality for the customer is substantially lower than his/ her actions in achieving compensation of losses. Therefore, the settlement of issue through the legal-administrative procedures is not efficient.) The strategy for the improvement of customer – government relations is similar to the regulation of market: using different devices in equalising their bargaining power. The key word is neutrality in treatment, ensuring equal access and introducing exact standards with clear definition of rights and obligation of sides in the exchange process. Also an ordinary openness is the device in reducing possible information asymmetry concerning costs of service. Very often the suspect of customers that government is “worst manager” and is delivering too expensive services is formed, because ordinary people have no idea, how government organisation is running its business and what efforts should be made to deliver a good or service. The adequate image of the “kitchen side” of government activities should be formed by active PR. These are main devices of balancing roles in that dimension. The first and then the fourth strategy of PAD is most appropriate here. A Client is an individual, receiving complex professional service or aid from the government for the development of individual social capacity. The variations in service specific, dependent on individual needs and larger social environment, is very high. The monopoly position of government towards the client as well as information asymmetry is unavoidable. Equally difficult is the definition of real need of client: as these are very different, the standardisation and equal amount approach would became disastrous in case of professional services. The quality and targeting of these, as a rule quite expensive services, is presuming tight and permanent personal contact between client and service provider. In that case the mutual trust and permanence of relations would be decisive link in harmonising client and service provider relations. The imago of organisation is in that case much important than the enlightenment functions of public relations. As services delivered are complex and information asymmetry usually high, there should be need for some preliminary activities (advice, extension services) from the client side to get access to the service that is not appropriate to the customer services. Here government official cannot behave in manner as he/she is delivering customer service, but should be responsive to eliminate reasons restraining the access to service. Good government have to bear expenditures to enable for the individual to fulfil these preconditions to became eligible for the service. For instance, draft bill on information’ freedom, prepared in Estonia is obliging courts -, in case a citizen applying to the administrative court is not able correctly to formulate an application - to assist in writing appeals. Besides, the real output for service receiver, as well as general costs and outcomes, are determined by variables far beyond of the service exchange process, i.e. by the wider context that usually are not under the control of sides. Therefore the client orientation include much wider and permanent activities from both sides, creating societal context for the efficient utilisation of service. (For instance, the quality of education could hardly promote level of competence, unless home and cynosure will not assist in the formation pro-active attitudes among pupils.) However, 8 supplementary devices of indirect client control should be developed, like neutral mediator (General practitioner) or supervisory boards, to promote clients interests as well as for the establishing permanent feedback relations. The second and then the fourth PAD strategy would be most efficient here. A Citizen. Individual as citizen have certain amount of rights in using public common or pool goods for the maximisation of one’s well being. Government’s role in relations to concrete individual is quite passive and the basic obligation is the development and maintaining this infrastructure. Unless ... the actions of an individual will not diminish the general utility of public good and do not diminish the benefits of other individuals. This dimension of individual – government relations is therefore at some point directly connected with his/ her role as subject. In other dimensions citizens – government relations are similar with the customer orientation, because the anonymity of their interrelations. Citizen’s dimension is much larger than usually considered. . Citizen must not considered purely in terms of consumer of public goods, but equally as individual, able through the increasing individual wealth, contribute to the increase of general affluence. Here public infrastructure is presuming an active role of the government in relations of concrete individual enabling equality and neutrality. Owner of private company is using an infrastructure – markets, communications, currency system etc. – in increasing one’s individual wealth. He/she is competing at the markets, but this may not happen, because the infrastructure (market, legal rules, currency system) may not promote the competition; bad communications (roads, telecommunication etc.) may disadvantage business in remote regions. Here one found much wider treatment of “customer orientation” and also substantially other devices the government can ensure better “customer service” in this dimension. An another example is the consumption of security: social and physical. The relatively remote and passive, to individuals in general, role of government in creating this infrastructure, is presuming very active and targeted actions of government in the process of “consumption” of this infrastructure by individual citizen. And of course, in balancing the citizen – subject dimension. The third and then the second strategy of PAD is most appropriate here to follow. A Subject. Usually customer orientation is considered as one-sided obligation of government to be “good father” in delivering benefits. However without subject dimension (defining the amount of citizen’s obligations and responsibilities to be eligible for receiving benefits), other dimensions in individual – government relations may not function appropriately. The function of government here should not be understood purely in terms of compulsion and supervision: i.e. in case individual is considered as obliged to compel and to do something that means to him/ her the loss of freedom and benefits. Subject’s actions of could be equally considered as service delivery. Subject would contribute to the public good and indirectly also to the individual well being (military service, car driver, following or not following traffic rules etc.). Government official, on one’s side may check the following traffic rules or environmental standards to avoid losses of benefit for other citizens and very often to the person, violating rules in the long-term perspective. The reservoir of customer orientation in this dimension is huge and would enhance through the applying various devices. For instance, in the third part I am analysing devices and prospects of “soft” supervision that would contribute to the improving relations between citizens and government. In improving government-individual relations the PAD should focus on the third strategy combined with the second. As you may see, the development various strategies of “citizen” – government relations would presume various emphasise on the different (however, an ideal-types) PAD priorities. Variations in PAD strategies may be related to the national specific. However, as I mentioned earlier, all of these approaches to PAD have its advantages and disadvantages. The other opportunity is to consider these strategies as related to various types of government organisations with basically different missions and aims. 9 The basic conclusion of this part is: the customer strategy cannot be efficient if it is not tightly integrated into the certain PAD strategy and vice versa. In next section I would like to analyse, how different devices of “customer orientation” would be developed in two substantially different fields of government: in the tax administration and in the forestry sector. 3. How the “customer orientation” would contribute to the efficient administration. Case studies form Estonia. As mentioned in previous chapter, in the real life “customer” roles are intermingling. In our cases you may find couple of specific devices of reshaping ( intentions to reshape) agency’s strategy towards various constituents with the aim to make one’s functioning more efficient and effective. (7) 3.1. How the redefinition of taxpayers and forestry owners roles would contribute to the effectiveness of organisation. There is the widespread conviction, held first of all by tax officers, that taxpayer is only subject with obligations to pay taxes. This stance has hidden connotation: all of them are attempting to evade taxes, if there is an opportunity. The contradiction of interests between citizens and government is installed into their relations from the outset. As a result, tax officers are faced with enormous task to oversee (supervise) individual taxpayers and to focus on time and recourse consuming audit. Tax administration has not enough capacity to do audits in-depth. There are several ways to became efficient: either to enlarge staff, to focus on the simplest cases to fulfil the plan and to let controversial cases that are too time-consuming, or to focus on different taxpayers using different strategies. Several facts from interviews revealed: (a) that large amount of incorrect declarations is caused by misunderstanding by taxpayers rules of declaration. No intention of tax evasion behind these errors was not found; (b) most reliable information about tax evasion came from judgements of local citizens; (c) as tax declaration is quite new arrangement, citizens haven’t habit to plan one’s activities to meet declaration deadlines. Close to deadlines cues at the tax office are enormous and overload of servicedesk clerk is inconceivable. Both sides are overloaded with work, that inevitably produces discontent, errors and tensions. We had two solutions. One of them was proposed by directors of regional tax boards. (1) to devolve tax declaration and extension services from regional centre to biggest towns in the region, to make these services more close to citizens and to improve information feedback from local population. This arrangement was denied by the leadership: too close relations between official and taxpayer may result in their collusion. (2) to make clear distinction between taxpayers: (a) who are ready, but not able for the correct declaration. Free counselling as customer service would make them a very reliable taxpayers. Their declarations are quite easy to subject to the short selective control, that does not presume involvement professional audit staff. (Large proportion of them are physical persons.) (b) who are ready, but does not feel that the declaration is important and let the declaration to the final day of deadline. For this customers public advertising is probably the most efficient service. (c) who are ready to pay adequately, in case losses from tax evasion could be much higher that benefits received. Their behaviour is determined by two basic presumptions: (i) tax regulations are with “holes” and there is possibility to avoid them in case of professional advice; 10 (ii) tax regulations are incomplete and let for some companies unjustified advantages; so, company is deeming about how to compensate this disadvantage to be competitive. This part of taxpayers need obviously the client service devices to balance their role as subjects. Misunderstanding in interpretation of regulation is the main subject of controversies between them and government agency. And both sides are quite unhappy and sometimes angry. This category of taxpayers established NGO - “The Taxpayers Union”. However, hostility of both sides shaped fertile soil to the denial of client orientation. This was in my opinion the biggest mistake the tax administration made: hostility and adversarial competition between government agency and Taxpayers union is rising substantially the overload of administration and is cutting down the feedback, enabling the improvement of tax regulations both sides actually are interested. Estonian tax administration has gradually involved constituencies into the process of preparation and elaboration of policy proposals as well as proposals on the improvements of tax management devices. This class of taxpayers should be never put together with fourth class – (d) persons intending malevolent tax evasion. Rational taxpayers “are playing” with tax administration in the broader of permitted and are trying to benefit from the incorrect rules of game. One part of citizens are convinced in the worth of democracy not because they like this inefficient device of government, but because other devices of government are even worse. Equally, taxpayers who are calculating rationally could follow taxation rules, because not following seems to be even worse. But what is more important, rules that are shaped jointly are more convention-like, that even competing sides are respecting more probably that imposed rules. Malevolent taxpayer is not accepting these rules anyway and this is not a contingent, that tax administration should deal with either. When this category of subjects will be “administered” by the tax police, then tax administration may have more recourses and time to develop clientoriented mechanisms with the third category. Equally wrong is to hand over all the tax management to the police, as in Russia. The malevolent tax evasion has not reduced in Russia also because Tax Police is dispersing its capacity in dealing with taxpayers, who may became as clients and customers. (Similar typology of taxpayers has been developed at the Swedish Taxation Board, and it was the pleasant opportunity to discuss the basic argument of the typology with Mr. Gunnar Olsson (Head of Research Division of STB) in Tallinn, October, 1998) The same approach has been followed from the beginning in the course of elaboration of the Forests Administration strategy. The Strategy made principal difference in its policy implementation between on the other hand, forests-landowners, who are considering one’s holding as long-term investment and basis for continuos, but small profit. This is the class of potential competitors to State Forestry, who interests are not in conflict with government forestry policy, first of all with government environment protection aims. On the other hand, other part of forests land-owners are looking for fast cutting its forests to get as soon as possible and as much as possible return in cash. Quite often they are selling its roundwood below the market price and therefore their actions are disordering price formation at the roundwood markets. They are also not eager to invest into the forests reproductions and thus their actions are damaging environment. In the structure of Ministry of Environment two agencies are dealing with these two groups separately: Agency of Forestry and Environment Protection Inspections. During the long period I found this arrangement inefficient and insisted that this function should be put to the police agency. The problems, accompanied with such solutions became clear in the course of the study of tax administration. Police is not responsible neither for tax policy not the environment policy. This is for 11 them rather the secondary aim and appeals from tax administration or forestry administration are frequently neglected. One interesting solution has been reached in Järva county. Police officers and civil servants from Inspection are formed as the task force under the supervision of county governor. 3.2. Introducing the “soft supervision”. The “Soft” has become rather fashionable word anticipated with the good governance. Estonian forests policy is offering elaborated device of the soft supervision. This management tool may be implemented only after the different strategy for different constituencies or roles has elaborated. For, the aim of soft supervision is develop supervision as checking the compliance (and forestry owner as a subject) into the client service. How and why' The basic ideas of soft supervision are: 1. to avoid quite widespread situation, when the supervision costs are substantially higher that the real damage caused by the violation of rules; 2. soft supervision can quite soon select out inefficient and senseless regulations, that are made, departing from the agency ideology and interests; 3. to establish clear difference between principal, obligatory regulations and regulations as recommendations. Supervision over numerous regulations cannot contribute substantially to the policy aims it is difficult to carry out in practice. The agency can concentrate on the supervision over the first class of regulations and make this more efficiently, because it may mobilize its scarce resources. 4. to achieve neutrality of supervision in situation, when government (as public authority) is simultaneously the competitor of those, its is supervising over. Two rearrangements were made, departing from this principle. (a) the institutional separation of administrative and economic functions of forestry administration. (b) creation of private or non-profit expert services, responsible for the technical dimension of supervision. I.e. soft supervision may be also effective tool to avoid conflict of interests so often found in the government agencies. 5. classical supervision is relying on the negative incentive to avoid sanctions. Therefore citizen – government conflict is inherent to the classical supervision. This is one of reasons, why it is expensive. But also the reason why an agency is not interested in the realisation of its mission. Efficient supervision would diminishing the size and recourses of an agency if it has successfully achieved its mission – to diminish the violation of rules. Soft supervision is relying on mission to improve an understanding by the subject that the regulation would meet its long term interests and therefore should be followed. Therefore, one of the basic device of soft supervision is the development of extension services, recoursed by the government; and also the investment to the environmental education. I.e. soft supervision would be by the nature the service delivery for subjects. The larger part of subjects has conceived this, the smaller recourses government should spend on the supervision. 3.3. Developing potential competitors in the service delivery markets, with the aim to shape balanced, organic market system. One of basic mission of government is the minimisation of market failures through establishing efficient regulations, that would balance market. First and the most important aim is to balance producer and purchaser bargaining power at the markets. To have assets in the private property is not enough for the formation of flexible and competitive market. Reforms in the CEE countries should not focus only to the traditional sources of market 12 failures; developing markets are containing various specific sources of failures, for instance the absence of stable business culture. Almost any private forests owners had no previous experience of forests management and marketing. Their holdings are small and lots of roundwood are usually small. Therefore, the management of forests by them is very inefficient and their marketing power incomparable with almost monopoly power of timber firms. Here the efficiency and return, on the one hand, and long term investment strategy on the other hand would mutually reinforce or vice versa restrain each other. In case the careful owner is founding that his/her establishment not profitable, but not understanding that this is because of intensive market failures, he/ she is joining with the group whose intentions and interests opposite to government policy. Main aim of government agency should be to revert this tendency, for this is diminishing also the profitability of its forests production: the less transparent and understandable is the developing market, the less adequate are prices and, hence, the profits from roundwood sales. These are purely economical aims. But these trends have also very certain policy outcomes. Forestry administration in Estonia has set the development of private owners capacity as one of priority, and started to fund development activities (extension services, training, renewal of forests, composing business plans) at the expense of profit, made in the public forests industry. The other strategy of government has been the promotion of private forests owners unions, production cooperatives, as the fastest way in increasing their bargaining power at the market. 3.4. Involvement of constituents into the decision-making process, that is also aimed in reducing the impact of agency ideology on decisions. Why citizen’s involvement into the decision making participation would be useful for the public agency. How this could fit with the aim of public bureaucracy to strengthen its power-positions' Often the need of participation is justified with the reference of democratic values. This could also be an argument, to convince bureaucracy to promote the participation. However, the participation of constituencies – in case of forestry policy development – substantially reduced its efficiency. Representatives had good ideas but these are not relied on systematic knowledge. Often their intentions to participate are deriving from superstition that agency is a priori behaving against the constituents interests. Participation would substantially erode such suspect. The paradox revealed: the more access interests got to the decision-making locus, the more rapidly their readiness to make professional contribution and participation ratio is declined. The Strategy development unit not only supported the participation, but make investment to the training course on the policy/ program development. Why' In another paper (8) I and K. Kasemets developed the typology of devices of participation, dependent on the policy cycle. The basic conclusion we came: the participation could improve not only quality but also legitimacy of regulations. The more citizens are deciding themselves, the less responsibility for the concrete results a civil servant has, the more citizens themselves are interested in implementation and control. I.e. this would reduce the workload of civil service during the implementation stage and improve the imago of agency as the neutral authority among citizens. In sum This was my first attempt to analyse the government activities through the prism of different roles individuals and other subjects would play in the service delivery process. Empirical evidence our field research gave, would open a way to the more systematic analysis of the improvement of government – citizens relations. What was 13 the most important conclusion: the strategy of the development of these relations would be analysed more profoundly as one of dimensions of the general strategy of PAD. References 1. See a brilliant brief analysis in R. Quinn et. Al. Becoming Master Manager. A Competency Framework. John Wiley, 1996, pp. 3-11 2. See: R. W. Scott Organisations: Rational, Natural and Open System. Prentice Hall, 1992. 3. General of framework of following deliberations is relied on typology prof. Guy Peters presented at the lecture for the students of Department of Government, Tallinn University of Educational Sciences, 08.03.1999. The diverse strategies of PA reforms have been discussed by W. Kickert,, H. Pollitt, Ch. Hill etc. 4. N. Flynn Public Sector Management. Harvester press, 1990 5. J. Boston et. al. Public Management reform in New Zealand. Oxford. University Press, 1996 6. Managing Government, Governing Management. (Harvard Business Review, 1996, May-June). 7. This analysis is based on empirical evidence, found in the research reports: G. Sootla, E. Puustjärvi, A. Varblane Hinnang Eesti metsandussektori arengustrateegia kujundamisele ja elluviimisele Eestis (1995-1998). Tallinn, PHARE, 1998 (56 p.) [Preprint] (Elaboration and implementation of Forestry sector development strategy in Estonia). G. Sootla, K. Kasemets et. al. Local and Regional Tax Administration in Estonia. Tallinn, 1998 (138 p.) 8. Evolution of Roles of Politicians and Civil Servants in the Policy Process.(The Case of Estonia.), published in this book.