Introduction to privatization of inspection control?

Institute Alternative recommends that the Government of Montenegro withdraws the proposed amendments to the Law on inspection control from the parliamentary procedure, take them back to the draft form and start a public debate.

If the proposed amendments are adopted, they will make way for introducing privatization in the field of inspection control, and will do that without a publicly available analysis of the problems in the functioning of inspection services.

If the Government does not withdraw the proposed bill, deputies in the Parliament should devote additional attention to this important proposal of the Law and file amendments so as the state would not be deprived of one of its most significant functions.

The Government and the Parliament have to consider a thorough analysis of the problems in functioning of the inspection services and come up with legal measures and practical steps for improving efficiency of their work.

The current publicly available findings indicate that through a clearer division and clarification of responsibilities of the inspections, determining remuneration system for inspection officers, a strong fight against corruption in the inspection services and better defined communication and cooperation of inspection services at both state and local level with other state agencies and citizens, a more appropriate solutions of the existing problems could be found.

Proposed amendments to the Law on inspection control prepared by the Ministry of Interior Affairs and Public Administration, are in parliamentary procedure. By the convocation for the second regular session of the Parliament in 2009, scheduled for 14 October, sixth point on the agenda are the amendments to this Law. The Law on inspection control currently in force has been adopted in 2003.

The rationale of the amendments states that the ‘lack of competent personnel in the state and local institutions for performing the tasks of inspection control in certain administrative areas is evident, while on the other hand, the necessity of efficient, economical and lawful exercise of these activities, has caused the need for introducing the solutions concerning the possibility of performing inspection control tasks through transferring and delegating them to legal entities to the current Law on inspection control’.

Institute Alternative considers that this remark was supposed to be preceded by an analysis of problems of the state institutions concerning the competent personnel, their training, rewarding system, motivation and advancement in service.

In the case that such analysis has indeed been performed, it should have been made publicly available and submitted as a part of the bill. Even better, it should have been a subject of an expert public debate on draft and amendments to the Law.

Since the aforementioned problem has been diagnosed in both state administration and local self-governance, it is concluded that the task of inspection control should be delegated onto private legal entities, including economic organisation.

There are no firm guarantees that there is enough or more competent personnel apart from the institutions of state administration, who would be capable of performing the inspection control tasks for the same or lower remuneration.

Apart from that, the institutions of the state administration would still have the obligation of providing oversight over the work of legal entities that have been entrusted with the tasks of inspection control. The Law on State Administration has prescribed that ‘the administration body controls whether the entities that have been acting in accordance with the law in performing duties transferred to them, and warns them when a break of such rule has been detected, suggesting measures that should be taken’.

The Law on State Administration states that ‘certain affaires of the state administration are to be delegated onto the local self-governance, institutions and legal entities for the purposes of those affaires being performed more efficiently and economically. Decision on delegation of the affaires and tasks is preceded by a study of advisability which must include 1) justification of delegating tasks, 2) a precise specification of the tasks to be delegated, 3) subject those tasks are conferred to, 4) opinions and stances of the institutions of local self-governance, institutions and legal entities on possibilities and conditions of performing tasks they are entrusted to, 5) the existence of conditions with regard to organizational, personnel, technical, financial and material issues, 6) the conditions and manner of financing delegated tasks’.

Since delegating, transferring of inspection control tasks requires financing, the statement included in the rationale of the bill which suggests that ‘enforcement of this Law does not require allocation of separate resources from the state budget’ cannot be taken as true.

It is also uncertain whether this article of the Law on State Administration is in accordance with the Law on Public Procurement, meaning wheter it would be necessary to announce a tender when delegating tasks and authorities of inspection control in certain area to private legal entities, in order to protect competitiveness and standards of public procurement.

Furthermore, a question regarding the way the issue of conflict of interests is to be avoided in a situation when a legal entity which is entrusted with the tasks of inspection control is in the same time a potential subject to the inspection is also raised.

Institute Alternative considers the tasks of inspection control as the last authority of the state and local institutions that should be privatized, if such need is at all to be taken into account.

We understand that the goal and the idea of transferring and delegating affaires of the state administration was to decentralize services in the areas such as health care, welfare and education, but not including inspection control.

Since decentralization in areas such as health care, welfare and education as well as in general has not been implemented, authority or financialwise, allowing possibility of private sector participation in performing inspection control tasks can additionally degrade the system of state administration.

Unfortunately, the Report of the Committee for political system, judiciary and administration, it is impossible to acquire more information on contents and the flow of the debate on the proposed bill, but it certain that MPs have not tried to make amendments. It has been supported by a majority of Committee members.

Montenegrin Parliament’s Rules of Procedure prescribe that MPs can file amendments until the general debate concerning bill has started.

The European Commission’s Montenegro 2008 Progress report states that ‘the administrative capacity of the Market Inspectorate and of other authorities carrying out market surveillance activities needs to be further developed, along with coordination and mutual cooperation between these authorities. In this context, one is to develop a market monitoring strategy’. It also says that ‘the administrative capacity of the Ministry of Health, Labour and Social Care and its inspection department are not yet strong enough and establishment of the safety at work agency needs to be speeded up.’ ‘A Law on nature protection transposing provisions of the Habitats and Wild Birds Directives was adopted in June 2008. Further efforts are needed as regards awareness-raising in this field. Inspection measures and sanctions have not yet been adopted. Preparations in this area are at an early stage. The level of alignment has improved, but implementation and enforcement remain a challenge.’ Also, ‘the administrative capacity of the Ministry of Tourism and the Environment remains weak. Coordination between the bodies involved in environmental protection issues, particularly in inspection activities, needs to be significantly improved. The environmental protection agency is in the process of being established. The lack of implementation capacity at local level and poor coordination between central and local government further limit the enforcement capability.’ Later on, it is said that ‘overall, some progress has been achieved in terms of alignment with the European standards. Further efforts are needed, however, particularly on implementation and enforcement. Particular attention needs to be paid to strengthening administrative capacity and to establishing effective inspection services.’

It is unknown to us whether the idea contained in the bill has been suggested in any document of the domestic or foreign authors, organizations or institutions.

Institute Alternative recommends that:

The Government should withdraw the bill from the parliamentary procedure, return it to the draft form and start a public debate.

MPs should pay special attention to this bill and file amendments in order to prevent privatisation of inspection control sector in the proposed manner.

The Government and the Parliament should determine appropriate legal solutions and practice for enhancing efficiency of inspection services, after thoughtful and competent public debate on issues concerning their work.

Law on State Administration, Article 82.

Report of the Committee on considering bill on amendments to the Law on inspection control.

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