Posted by Michel Lazare
Fiscal policy makers, academia, and public financial management practitioners in general agree on the positive impact of transparency and accountability on economic performance and on public confidence and trust in government. Proving this positive impact to the general public in a convincing and accessible manner is, however, often a challenge--a challenge that Maurice P. McTigue, Vice President of the Mercatus Center at George Mason University and former Minister in New Zealand in the early 1990s, seems to successfully meet. Two speeches he pronounced in Louisiana over the last few months attest of his success in this area.
- The first speech entitled "Transparency and Accountability in Louisiana" was pronounced on November 28, 2007. This speech presented to the Government and Fiscal Reform Advisory Council the results of the Mercatus Center's research on state transparency and accountability practices in Louisiana.
Click here to access the full text: Download 20071128_Louisiana_testimony_final1.pdf
This speech quotes the definition of accountability retained by the Government Accountability Project at the Mercatus Center: accountability is the "process that requires us to disclose fully and truthfully our performance to those who are entitled to know."
Furthermore, the speech includes the following statement on the impact of transparency:
"Full transparency in government provides an incentive for decision makers to act in a spirit of compliance. The capability of the public to easily examine and review the full performance and financial statements of government entities leads to confidence and trust in the public sector. Full performance disclosure forces public agencies to focus on actual outcomes [...] , not the quantity of activities."
As for accountability in Louisiana, the Mercatus Center's research concludes that despite some strengths, a number of areas can be improved. here are the headline recommendations:
- Bring transparency to Louisiana's regulatory process;
- Create a State Ombudsman to be an advocate for the citizens of Louisiana;
- Ensure that all reports required by law are completed and made immediately available to the public;
- Create an on line state spending database;
- Redesign Louisiana government's web site with focus on transparency; and
- Re-institute the Louisiana's Legislative Subscriber Service.
The second speech ("The Effect of Transparency on Ethics, Honor, and Results in Government") which was delivered at the World Trade Center of New Orleans on February 8, 2008 even strongly advocates that transparency is a key requirement for the success of Louisiana's recovery efforts.
Click here to access the full text: Download 20080213_mctigue_wtc_speech_feb081.pdf
The following excerpt advocates full transparency
Full transparency in government provides an incentive for decision makers to accept that there is a consequence for decisions and that those consequences will be in full view of the public. Full transparency brings information to the public that allows them to make informed judgments about:
- the behavior of elected and non elected public officials;
- about the public benefits arising from public expenditures;
- about progress being made on resolving societal problems; and
- the legacy they will leave to future generations living in their state.
The ability of the public to review the full performance and financial statements of government entities leads to confidence and trust in the public sector. Full performance disclosure forces public agencies to focus on actual outcomes for Louisiana, not the quantity of activities.
Finally, the speech includes anecdotal evidence why results-oriented-spending and managing for results can be important. My favorite one is the following:
Very few of us object to public expenditures on.... Education, because we think teaching children to learn and develop skills is a good thing to do. Shouldn’t we know by how much children’s reading ability has improved as a result of that expenditure?
Imagine if you were an investor and publicly traded companies only had to disclose how they spent money but did not have to declare whether or not a profit or loss resulted from that expenditure of money. How much confidence would you have in your investment? [...] Why should we have any less of an expectation of government in terms of informing us of the results of their achievement?
