• Is Foreign Aid Compatible with Good Governance?
  Eduardo Araral, Jr.
  
  Is foreign aid compatible with good governance? Using the case of irrigation aid in the Philippines, I hypothesise that aid is embedded in a perverse set of incentives which could undermine the application of good governance principles espoused by donors. My findings suggest that the problems of “moral hazard” and aid fungibility are embedded in irrigation aid. Furthermore, these incentives also drive a vicious cycle in irrigation commonly found in many developing countries. These findings indeed suggest that incentives structured into the relationship between donors and irrigation agencies may undermine the application of some principles of good governance espoused by donors.
  
  
• The Judiciary’s Role in Good Governance in Korea
  Joongi Kim
  
  Abstract
  This paper will focus on the role that the judiciary has played in improving public sector governance in Korea. It will argue that the increased level of enforcement has become a cornerstone for the consolidation of rule of law and good governance. The paper will concentrate particularly on enforcement through the level of judicial sentencing against senior public officials who have committed violations in two areas: campaign financing and election laws, and anti-corruption laws. The paper focuses on the judicial treatment that senior public officials such as National Assembly persons or senior bureaucrats have received under the legal system. In the end, the paper will offer some comparative lessons that can be learned from the Korean experience.
  
  
• Improving Administrative Performance in Malaysia:
  The More Difficult Next Steps in Reform
  Hong-Hai Lim
  
  Abstract
  Despite past reforms, the Malaysian bureaucracy has lagged behind rising expectations. This paper reviews past reforms and suggests changes in reform strategy and measures for improving both the capacity and the will of public officials needed to raise administrative performance to meet domestic and global pressures. Combining technological and political perspectives, it argues that improving the will of public officials is both more important and more difficult than improving their capacity. Improving the will to perform promises significant gains in performance, but it requires reforms, mainly strengthening public control and making the bureaucracy more representative, that entail significant sacrifice of the interests of entrenched elites and groups. Malaysia has reached a juncture where she has to confront politically more difficult choices in administrative reform than in the past.
  
  
• Health Reforms in Rajasthan: An Empirical Study on Agencification
  Avantika Singh
  
  Abstract
  Agencification, or the carving out of independent agencies from the government, is a New Public Management approach for restructuring government through separation of the policy formulation and policy implementation functions. This research is devoted to an empirical investigation of agencification in the public health system of the State of Rajasthan in India. The objective of this research is to make a meaningful contribution to the understanding of the rationale for agencification, composition of agencies, autonomy and control of agencies, and service delivery by agencies. This research employs organisation theory perspectives such as interorganisational relations to explicate mechanisms for achieving functional integration and coordination between agencies and parent departments. Agencies studied in this research are legally independent bodies with not-for-profit status, which function within the policy framework provided by the parent ministry/department. However, there is no explicit performance contracting and accountability for results, and the idea of agencies is path dependent and linked to the reforms process. Because of resource dependence, agencies achieve functional integration with the parent ministry/department. Most of the agencies deliver services through a network of private providers and voluntary organisations, which establish coordination through the exchange of resources and information. Coordination is more formalised and dependent on Memorandums of Understanding (MoUs), contracts and paper-based reports than on trust, norms, reciprocity and informal communication.
  
  
• Technocratic Solutions versus Political Realities: Implementing Governance Reforms in the Balochistan Province of Pakistan
  Raza Ahmad and Syed A.A. Akif
  
  Abstract
  Almost immediately after taking power in 1999, Pakistan’s fourth military regime articulated a seven point agenda that in large measure entailed governance policy shifts – the key being decentralization of powers and democratic local governance. Pakistan’s Poverty Reduction Strategy Paper (PRSP) articulated these goals in the pro-poor growth framework. The international aid community favoured this reform climate and the Asian Development Bank (ADB) took a lead in supporting public sector reforms especially by way of improving sub-national governance in a federal context.
  
  This paper focuses on the reform agenda articulated through ADB assisted Balochistan Public Resource Management and the complementary devolved social services programs. While it is still early to assess the impact of these policy shifts, we conclude that improved service delivery through better fiscal management is a long term goal. The ongoing reforms are located within and impacted by historically difficult federal-province relations and a highly contested political climate. There is an inherent danger of institutional reforms being appropriated by entrenched elites. In conclusion, subnational reforms cannot be isolated from the imperatives of federalism, local patrimonial structures i.e. the political economy context. Development agenda[s] should overtly address politics in designing and implementing governance reform programs.
  
  
• Reforming the Centralised State: Assessing Decentralisation Paradigms in the Drinking Water Sector in the Philippines
  Satyajit Singh
  
  Abstract
  Institutional reforms in the drinking water sector in the Philippines have taken the shape of “privatisation” and “decentralisation”. This paper reviews the working of these new institutions in the form of water utility, association and cooperatives in the province of Oriental Negros in the Philippines. While highlighting the important role that the provision of safe drinking water can play in poverty alleviation, this paper questions the ability of these reforms in addressing pressing concerns of poverty and access to water services. The case studies also point to the inability of this model to address wider concerns related to the public goods nature of water. Yet, decentralisation is not synonymous with privatisation and this paper points to the different paradigms of decentralisation (with varying degrees of private and public elements) in the water sector. The paper argues that the decentralisation vision enacted in Local Government Code of 1991 provides an opportunity for the state to deprivatise the drinking water sector and affirm the pivotal role of the local government in the provision of public goods.

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