Permit-Issuing One-Stop Shops in Construction and Land Operations Substantially Decrease Corruption

On June 17, the ACTION project presented the results of a survey, which analyzed perceptions of corruption in the sphere of construction and land operations permits held among Ukrainian entrepreneurships.  The survey compared the level of corruption experienced by Ukrainian companies while obtaining permits through both the traditional system and the recently introduced one-stop service (OSS).   Juhani Grossmann, ACTION project Chief of Party, noted: «One-stop service (OSS) is much more effective in issuing permits than the traditional permit system.  Overall, the duration and the number of steps necessary for issuing a permit in a one stop service are significantly less.  For land operations (selling, leasing), the average time necessary to issue a permit is 68 days, while in the traditional permit system it reaches 220 days!». Main Survey Conclusions: •     65% of respondents perceive the construction permit system as corrupt; 74% of companies that have experience in obtaining land operations permits express the same sentiments. •     In the traditional permit system the percentage of companies that experienced corruption when obtaining a land operations permit was somewhat higher (44.7%) than when obtaining a construction permit (35.8%).  However, for companies obtaining a permit through an OSS this percentage is smaller.  Only 13.1% of companies obtaining a land operations permit and 24.1% obtaining a construction permit faced corruption.   •     In comparison to the traditional permit system, the OSS results are more encouraging.  Overall, the duration and the number of steps necessary for issuing a permit in a one stop service are significantly less.   However, in the respondents’ opinion, the OSS approach is not yet ideal.  Among the negatives of an OSS, a majority of respondents noted the formidable duration of the procedure, the necessity of additional individual visits to permit bodies while using the services of intermediaries, the limited range of services and the lack of information on OSSs.   This survey results show that more work is needed in improving the quality of OSS; including personnel and top management training.  Moreover, it is important to monitor the quality of OSSs by instituting a report card or other method of surveying clients.   A majority of companies share the opinion that OSSs may become effective in countering corruption.  Fifty-six percent of respondents, who have obtained land operations permits, noted that OSSs contribute to a decrease in corruption, and among entrepreneurs that have obtained construction permits this percentage is 75%.   Survey methodology and sample size: The quantitative survey included companies that have experienced obtaining land operations permits (N=136) and construction permits (N=126), while using the traditional permit system approach, and also companies that received those permits through OSS (N=54) land operations permit and (N=61) construction permits.  The qualitative survey included in-depth interviews with the company employees who have experienced obtaining land operations and construction permits, the company directors – intermediaries, who issued or assisted in obtaining land operations and construction permits.  The survey was conducted in all regions of Ukraine and the Autonomous Republic of Crimea.   _____________________________________ In 2005, the Law of Ukraine on Permit Systems was adopted.  It provided for a simplified procedure for permit issuance, including land operations, and construction permits, and for procedures for OSSs.   _____________________________________ Information about the project Promoting Active Citizen Engagement (ACTION) in Combating Corruption in Ukraine is implemented by the Management Systems International (MSI) in partnership with Ukrainian organizations with the financial support of the United States Agency for International development (USAID).  ACTION project is a two-year activity that supports non-governmental monitoring and advocacy on priority areas in the fight against corruption, focusing particularly on issues identified by the Government of Ukraine in its Millennium Challenge Corporation (MCC) Threshold Country Plan, namely: strengthening judicial reform; government monitoring and enforcement of ethical and administrative standards; streamlining and enforcing regulations; and combating corruption in higher education establishment institutions.  One of the major tasks of the ACTION project is collection and publication of the objective information on the state of corruption in Ukraine.   If you wish to subscribe to ACTION project news, please e-mail a request to info@pace.org.ua, with the word “Subscription” in the subject line.