REDUCING PUBLIC SECTOR EMPLOYMENT BY LIMITING RECRUITMENT: THE SPANISH EXPERIENCE Isabel Hernández MINISTRY FOR PUBLIC ADMINISTRATIONS

THE KEY POINTS 1. OBJECTIVES OF THE SPEECH 2. FIGURES ARE SELF EXPLANATORY 3. THE MAIN REASONS 4. THE CHANGE IN THE TERRITORIAL ORGANIZATION OF THE STATE 5. THE POLICY OF LIMITATIONS FOR THE RECRUITMENT OF NEW EMPLOYEES 6. THE PRESENT TENDENCIES

1. OBJECTIVES OF THE SPEECH To explain the reduction in national public sector from 1978 to the present. To examine the two main reasons that justified the change.

2. FIGURES ARE SELF EXPLANATORY Public servants before 1978: 1,713,372, all of them belonging to State Government (not including Local Government). Public servants at 2006 (State Government): 546,716.

3. THE MAIN REASONS 1. A change in the territorial organization of the State: Before 1978 Spain was an unitary and highly centralized State. After 1978 three different levels of autonomy: State, Autonomous Communities (17), and the provinces (50) and municipalities (8,104) (local Administration) plus the autonomous cities of Ceuta and Melilla. 2. Since 1996, implementation of basic limitations for the recruitment of new employees.

4. THE CHANGE IN THE TERRITORIAL ORGANIZATION OF THE STATE The outcome of the change in the territorial organization of the State are: A radical transformation of the State and the public administration through a process of extensive political and administrative decentralization. The transfer of State civil servants to the Autonomous Communities to provide the new territorial/administrative step. A new legal framework to allow the new structure (12/1983 Act plus Royal Decrees). The results are as follows on the next slide…

5. THE POLICY OF LIMITATIONS FOR THE RECRUITMENT OF NEW EMPLOYEES Implementation of basic limitations for the recruitment of new employees consists of: Policy directed to reduce the number of staff in both, Ministries and Autonomous bodies (25% for the personnel replacement rate). Affects both, the State and Regional Governments. Excludes specific groups where it was necessary to incorporate a large number of new staff (Armed Forces, personnel in service of Judicial Administration).

5. THE POLICY OF LIMITATIONS FOR THE RECRUITMENT OF NEW EMPLOYEES (II) This policy was adopted during the years of Partido Popular (Popular Party)Government ( ), whose ideology is liberal. For that reason there was a strong tendency to reduce the public sector in favor of the private sector. In this period many semi-private institutions and private corporations were created. In recent years, especially from 2005 and 2006, the tendency is just the opposite, in favor of the public sector, due to the present government of Partido Socialista (Socialist Party).

5. THE POLICY OF LIMITATIONS FOR THE RECRUITMENT OF NEW EMPLOYEES (III) This input is also the tendency within the Autonomous Communities, depending on the kind of government they have, as we can see in the following slide (using the criteria of population size).

VALENCIA 2.50 PAÍS VASCO 2.74 MURCIA 2.94 MADRID 2.46 LA RIOJA 3.05 GALICIA 2.82 NAVARRA 3.52 MELILLA 1.85 CANARIAS 2.87 CASTILLA Y LEÓN 3.35 CEUTA 1.90 BALEARES 2.13 CASTILLA LA MANCHA 3.22 CATALUÑA 1.99 ASTURIAS 2.97 CANTABRIA 3.10 AGE 1.22 ANDALUCIA 2.96 ARAGÓN 3.01 EXTREMADURA 4.07 Hasta 2%Entre 2 – 3%Entre 3-4%Más de 4%

5. THE POLICY OF LIMITATIONS FOR THE RECRUITMENT OF NEW EMPLOYEES (IV) The following slide shows the proportion of semi-private organizations that have been created in the last few years (functional decentralization).

5. THE POLICY OF LIMITATIONS FOR THE RECRUITMENT OF NEW EMPLOYEES (V) The tools: The Annual Budget Act. The Royal Decree for Public Employment that Government approves yearly. The system: Convocation notices for the incorporation of new staff have to be centered in sectors considered as an absolute priority or which affects the operation of essential public services. The total number of vacancies for new access cannot be higher than 25% of the outgoing staff anticipated for the relevant budget year (personnel replacement rate).

5. THE POLICY OF LIMITATIONS FOR THE RECRUITMENT OF NEW EMPLOYEES (VI) The effects of this restrictive policy are: It is effective in reducing the number of staff, but systematic planning and reorganization of staff must accompany it. The reduction in the number of staff results in an excessive pressure towards short term employment. The tendency to transform short term employment into permanent employment.

6. THE PRESENT TENDENCIES Strengthening the public sector. Return to the situation pre Strong tendency to transform short term employment into permanent employment.