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                                   Background Report

                               Somalia Public Sector Issues

                                      February 2005

This report is based upon a literature review and interviews with key informants in public
and private sectors and the donor community in Somalia and Nairobi. There is more
information available about Somaliland than Puntland, and much more on those two parts
of Somalia than on South Central, where there is no government, except some local
government. However, we were able to meet more government officials in Puntland than
in Somaliland. Information on the Transitional Federal Government (TFG) was obtained
from a number of ministers and members of parliament resident in Nairobi. We were not
able to visit South Central Somalia; in fact only a few ministers and MPs have found that
region secure enough for them to go there. As a background report, the report is
descriptive rather than prescriptive.

1. Overview

The collapse of the central government of Somalia in 1991 disrupted all facets of the state
apparatus. Plagued by years‟ of civil war that led to a sweeping wave of migration and the
absence of central authority, the country is fragmented, with isolated, weak and
independent administrations emerging in different regions. These predicaments present
varying scenarios in terms of security, stability, instruments of governance, public and
civic organization, and economic recovery.

The National Peace and Reconciliation Conference in Nairobi succeeded to establish a
transitional parliament, elected a president and selected a prime minister and a cabinet of
91 in the attempt to establish a national government. It is difficult to predict the impact of
the new government will have on different regions, clans and communities. And even
more difficult to forecast is, whether the new government will succeed in establishing
itself as the long awaited central authority for Somalia.

Overall, while the Central and Southern parts of Somalia remain in a state of flux,
insecurity and rudimentary governance, with only limited pockets moving slowly toward
greater stability, elsewhere, namely in the Northwest (Somaliland) and in the Northeast
(Puntland), local communities have evolved towards actual instruments and forms of

Similarly, rudimentary local administrations are evolving in places like Middle Shabelle,

Hiran and other places in South and Central regions. Presidential elections in Somaliland
were held in April 2003; elections of Local Councils in January 2003, marking an
important step in the resumption of local governance and democracy. In Puntland, a 66-
member parliament was selected by communities and a president elected by the
parliament in January 2005, a partial and initial step towards the establishment of local
democratic governance.

Since the onset of civil war, migration of the most educated class, destruction of the
urban industry, displacement of the most productive agricultural communities, protracted
draughts and more recently livestock ban imposed by Gulf States created a growing
economic crisis of serious proportion. The ensuing conditions are flow of rural
communities to urban centers. Thus urbanization is rapid, fuelled by returnees, Internally
Displaced Persons (IDPs), and rural inhabitants drawn to towns by the prospects of
improved livelihoods. Most urban growth is haphazard. The lack of proper town planning
has its roots in the years of civil strife; people simply took over public land and put up
structures as they wished.

This migration from rural to urban is encouraged by the promise of informal jobs in the
emerging urban market economy.           There are growing demands to consolidate
reconstruction efforts and direct investments to certain sectors of the economy such as
transport and communications, medium to large scale manufacturing enterprises, housing
and land development, rehabilitation of public properties destroyed in the civil war and
urban sanitation.

The need for governance structures to facilitate, guide and regulate this process of
consolidation is strongly felt and required as basic guarantee for the future viability of the
investments being made and the security of the people. Current capital inflows and
investment from Diaspora occur in a total vacuum in terms of legal and regulatory
frameworks; the consequences are that much of the development taking place, as a result
of the investment, may fail to generate beneficial dividends for the community as a
whole; special cases in point are the inadequacies in taxation systems, preventing
adequate revenue from accruing to the state; the virtual non-existence of land and
property cadastres, limiting investment and fiscal revenue and creating potential for
disputes; institutional inefficiency in service delivery; deficiencies in land management
and development control, and to reverse the growing trends of land grabbing and

Poverty is widespread and the majority of the population still suffers from the effects of
displacement and destruction. Nevertheless, in regions where the investment trend has
been consistent for some years and where the „new economy‟ has acquired a genuine
momentum (Somaliland, Puntland and Mogadishu Metropolis), adding the value of
exports and remittances alone would indicate a fairly high GDP per capita by African
standards. Yet the majority of people survive at subsistence levels. This discrepancy
would indicate that a major potential for improvement in socio-economic conditions is
being missed and could be improved by strengthening governance instruments and

management capacity, legal and regulatory frameworks and fiscal mechanisms. All of
these policy and regulatory changes would provide a strategic planning framework for
investment that generates better opportunities for all, maximizing revenue collection and
investment capacity and ensuring a more efficient delivery of basic services, alleviation of
poverty, and re-distribution of resources.

From this point of view, Northwest (Somaliland) stands out as an intended national entity
where the whole process of „building a legal identity‟, from the drafting of a new
Constitution to the establishment of executive and judiciary powers and to the
promulgation of laws and subsequent regulatory instruments, has taken place. No matter
what the relative inadequacies and often contradictions that may exist within the
institutional and legal framework so far set up, the process has proven that consensus
building, among its various constituencies, has worked all the way up to producing a full-
fledge state apparatus, often blending elements of the old colonial legal codes with
elements of modern legislation and elements of clan-based traditional systems like the

The example is important (other regions like Puntland are moving along similar paths)
and worth supporting to make the system increasingly responsive to the demands and
expectations of the population. It is also as a valuable precedent to be used, when
conditions permit, for the full-fledge rebuilding of governance in the whole of Somalia.

Another important element to be noted concerns the need for political, administrative and
fiscal decentralization. Historical analyses of the recent national past are quite unanimous
in indicating as possibly the main reason for the downfall and ultimate break-up of the
country, the regime of hyper-centralization enforced during the Barre years, which
centered in the capital and around a central ruling elite all decision-making, all authority
for investment, down to all instruments for administrative and bureaucratic control. The
system flew in the face of the legitimate aspirations of regional communities hardened too
by a traditionally proud clan structure.

The whole public sector machinery, including Ministries where they have been
established, suffers from a combination of de-qualification of managerial, technical and
administrative cadres explainable by the lengthy disruption of academic institutions,
emigration of skilled human resources, overstaffing of institutions resulting in high
recurrent costs and low productivity. Overcoming these problems, at a time in which
social tensions remain high and employment conditions insecure, poses another major
challenge in the rebuilding of Governance.

Helping the system to work, through clear and transparent partnership between different
levels of government and with genuine involvement of the communities, is a major
challenge ahead in all regions, for peace and stability to be fully re-established and
maintained. This process ought to begin with law-making, wherever Legislatures have
been established; so far, the legislation enacted, as by Somaliland‟s Parliament, has often
reflected opposite imperatives, a centralist tradition versus the attempt to introduce

genuine systems of local autonomy; this has at times produced contradictory legal and
regulatory instruments, unclear definition of prerogatives between levels of Government,
cumbersome and inefficient procedures. Supporting established Parliaments in the overall
process of law making is a priority for a more efficient and equitable Governance.

The implementation of any new laws, rules and regulations is a major challenge facing
the regional administrations and future Somali national government. The absence of
technical cadre and shortage of individuals with managerial skills are impediments that
must be overcome. For example, Northwest Somalia (Somaliland) has a functional Civil
Service Commission (CSC) that was established in 1993. The CSC is a public
autonomous agency entrusted with human resource planning and the oversight of public
staff. Over the past four years the CSC has undertaken a number of initiatives such as
civil service reforms to right-size/downsize municipalities and selected ministries, as well
as the training of civil servants. This initiative felt short of its target because of lack of
resources and the political will to support the decisions of the commission.

The law making process and training of personnel must go hand in hand. This is a
continuous process and requires support especially in the area of providing instruments
for the systematic training of cadres and the creation of a responsible, motivated and
competent civil service; the same basic problems are bound to be experienced in a newly
reconstituted Somalia or in any of its regions if and when more formal Government
structures are established. The training needs of all the emerging governance institutions
must be addressed urgently, particularly in the current context of low donor responses to
resource appeals for Somalia.

2. Evolution of the Somali Public Administration

The British and Italian territories united and became the Somali Republic in 1960. As a
result, different Somali territories had different experiences of governance and public
administrations. The administrative approaches of the Italian and British colonial officers
were in large part defined by the administrative structure of their mother countries and
also by their economic interest. Their administrations were both highly centralized and
important position reserved for citizens of the colonial powers (UNDOS, LAS, 1997 p

In 1950, the territory under Italian rule was made a UN Trust territory and was to be
administered by a special trusteeship agency that would prepare the south for self-
governance by 1960. During this period the Italians were required to establish local and
central government institutions. Consequently a large number of local government bodies
were set up to administers urban centers and rural centers to deliver government services.
This included the establishment of municipal councils in 48 population centers and
appointing councilors to run them (UNDOS, LAS, 1997, p15). Secretaries trained in
municipal administration assisted the mayors and councilors. The councils dealt with
planning and development of public services and had fiscal and budgetary responsibilities
for their areas, and resolving minor disputes over grazing lands, water rights etc using

Somali customs and Islamic laws. The development of such local level government
structures was rather slow in the British administered Somaliland region, even though the
British had agreed in principle to the unification of the two territories at independence.

Even though the colonial and later, Somali governments retained the powers to dissolve
councils and enforce legislations from the centre, local administrative authority was the
first forms of public administrative structure Somalis have known.

At independence in 1960, which brought the together the British and Italian administered
territories, public administration was centrally organized and public goods delivered
through municipal and local authority at local level. The Italian legal system and public
sector delivery system was adopted, while common features of Somali customary law
continued to be applied alongside British legal system and Islamic Sharia law (Lewis,
1995 p xvi).

Part of the early challenges of the new government was the problems inherited from the
colonialists, especially from the heterogeneity of the British and Italian administrative
structures and procedures practiced in their respective territories and lack of common
written language. However, the new Somali government adopted a parliamentary system
with a president as the head of state, a prime minister and council of misters as the
executive body collectively responsible to the National Assembly. The united Somali
Republic was divided into 8 regions headed by regional governors, forty-seven districts
headed by district commissioners, all coming under the interior minister. There was also
decentralized local authority administration, with direct election for municipal councils
especially for urban centers. In rural areas, local representation was generally organized
along sub-clan or kinship groups, and elders acted as the medium of communication
between administrators and local community.

The first and second post independent Somali administrations were civilian and operated
a laisez-faire economy, with small and nascent public sector supported by a large
informal private sector. These administrations pursued a diligent skills development
program for indigenous Somalis to take over roles hitherto held by the British and Italian
transitional authorities. During this period, public sector activities focused on the
development of regulatory frameworks for efficient resource mobilization and sector
specific guidelines for civil servants.

The country underwent a dramatic change in its governance structure and public
administration in 1969 following the military coup that brought Siyad Barre to power.
The Military Junta abolished the National Assembly and replaced it with a Supreme
Revolutionary Council (SRC) comprising of Siyad Barre as the head of State, senior
military and police officers as heads of government departments.

Siyad Barre also changed the decentralized representative form of government to one of
centralized top-down socialist administration. Soon after, the military government
adopted Soviet style socialist management of public affairs. As a military government, all

the instruments of law and order were vested in the military, supported by a wide network
of civilian informers and socialist party functionaries (guulwade). Appointment to senior
government positions, such as heads of ministries, heads of State Owned Enterprise and
ambassadorial positions were based on loyalty to the president, or calculated strategy to
appease/ offend clan sentiment or for other strategic reasons to preserve power at the
centre. In spite of being in power for over 21 years, Barre failed to develop public
institutions capable of delivering social goods as do typical socialist state. The economic
system remained largely free market, and informal and far from socialist production
system. Hence Somalia‟s socialism never achieved anything like the its protégé, the
soviets Union, China or even Cuba

As expected, the public sector workers were numerous, majority not trained for the
positions they held and largely inefficient. For instance, in 1982/83, the number of public
sector workers was estimated at between 90-100,000, (excluding the military, police, and
paramilitary force (SDR, 1987 p 278). Health and education facilities were massively
under-utilized due to lack of experienced or qualified personnel to manage them. Because
of very low salaries of the public sector workers (about $6.5 /month for teachers and
health workers), the government was unable to recruit or retain public sector employees,
and those who remained depended on other sources of income such as petty trade in the
informal sector. Absenteeism from offices and sale of public goods for private gain
became the norm. The result was de facto privatization of all government services by
officials entrusted to deliver them. People with technical or managerial skills moved to
private sector jobs or migrated to the Gulf States where wages were much higher, and
public sector administration was near collapse when Barre‟s government collapsed in

By 1987, his government had become disillusioned with the socialist ideals and began to
recognize the important role played by the private sector in the Somali economy. In deed,
his government‟s last national development plan of 1987-91, lays emphasis on
establishment of technical and vocational training institutes to counter skills shortages
and embraces the reality of free market economy. As a result, the government begun to
develop strategies for enhancing private sector initiative in the manufacturing sector,
helped with acquisition of capital equipment for co-operatives, fishermen and farmers.

 The future Somali public sector administration will therefore necessarily need to take
cognizance of the past failures. Hence the scope and orientation of any new public sector
will necessarily be lean and focused to the most essential functions, such as maintenance
of national security, police force, judicial services and core social sector services such as
education, health and basic infrastructure (roads, ports, airports and water). The public
sector activities would be focused primarily to developing regulatory mechanisms,
supervising compliance to public service procedures through line ministries.

3. Current Size, Structure, Quality and Scope of the Public Service

Background. After the collapse of the government in 1991, all public institutions also
collapsed. The first attempt at restoration of law and order was by the UNOSOM in 1993,
whose primary interest was to establish a secure environment for relief operation. The US
led force also attempted to impose law and order, especially in Mogadishu and other
urban centers. The first attempt to form regional and district administration was also
made in 1993, under Addis Ababa agreements, which brought together all Somali
political groups in a peace conference in Ethiopia. We will discuss the kind of public
administrative structures that emerged in the different self- governing regions since but
first some generic institutions created mainly by UNOSOM while it lasted.

At the Addis-Ababa conference, which mandated UNSOM to establish for structures for
coordinating both humanitarian and reconstruction efforts, it was thought appropriate to
re-introduce administrative and public sector functions at regional and district levels. The
local level structures were seemed as the best means by which Somalis could be
encouraged to take control of their affairs. Accordingly, UNOSOM established 8 regional
councils and 58 district councils for the south and Eastern regions (UNDOS, LAS, 1997,
19). Somaliland had declared independence and established a transitional government in
the north, and was therefore not included.

The Addis Ababa conference also adopted formation of regional development committee
whose responsibility was to „priorities regional development activities and mobilizing
resources from communities in support of these activities‟ in the absence of central
government. It was envisaged that the regional administration would assume some of the
functions of a central government such as planning, budgeting, and providing regional
oversight of all rehabilitation and development activities.

Under UNOSOM, the local district and regional authorities, supported by the local police
and judiciary constituted the public administrative structure for each self-governing
region. Councilors worked on voluntary basis and the police, judiciary and prison
personnel received salaries from Life and Peace Institute (a swish Government funded
NGO). LPI also rehabilitated council buildings, supplied basic office equipments and
provided training programs for council officials.

Growth of regional and district authorities. The administrative authorities were
organized at two levels, i.e. regional and district authorities. The regional councils were
made up of representatives from district councils within the region. Each district council
sent three representatives to the regional council, one of who would become the district
commissioner. The regional councils elected or selected from among its members, a
governor and a deputy governor who should not be from the same district. The
responsibilities of the regional councils were;

      The governor acts as chairman of the regional council and chief executive of the
       regional administration
      To act as the regional authority;
      Develop laws and regulations for the conduct of public administration;

      Supervise the security forces;
      Ensure peaceful settlement of disputes and plan for the region‟s socio-economic

At district levels, the council consisted of 21 members elected/selected from the local
community in the district. The council in turn was to elect a district commissioner with
two deputies and appointed separate committees to be responsible for security,
development, finance and budgeting and other sectors. The term of office of the district
council was two years.
2. When UNOSOM departed in 1995, payment of salaries ended for police, judiciary,
and prison personnel and many regional authorities collapsed again, especially in the
south central regions.

Besides the self-governing regions of Somaliland and Puntland that have established new
public administration structures under their own charters (discussed in detail below),
some regions in the south-central Somalia have retained some semblance of public
administration system, albeit under different structures and diminished forms to the one
constituted by UNOSOM. Following is a summary of the existence or lack of public
administrative structures as at the end of 2004, in Puntland, Somaliland and south central
parts of the country.

Structure of the state. Government is led by an executive President. Under the “beel”
system, which had explicit clan representation in both houses, the President was selected
by a college of clan elders. Under the new constitution, approved in a referendum in
2001, President and members of the House of Representative are selected through a secret
ballot in a free general election. The President chooses a Vice President and nominates
cabinet ministers who are subject to the approval of parliament. The parliament is
bicameral with a House of Elders and a House of Representatives.

Currently the core institutions of government and public administration consist of the

          Office of the President
          Office of the Vice President
          23 Ministries, with 23 Deputy Ministers and Director Generals
          8 Ministers of State
          82 member Upper House of Parliament
          82 member Lower House of Parliament
          a Supreme Court and judicial system with some 35 judges
          6 Offices of Regional Governors
          5 Commissions
          2 Para-statal Agencies

          41 District and Municipal Councils, of which 19 are elected
          17,500 members of the security forces

Scope of public services. Security is the main activity of the public service. In
2001/2002, 55 per cent of expenditure was allocated to the security forces and 25 per cent
to the political organs of government. Only 8 per cent was allocated to the social sector,
albeit up from 2 per cent the previous year. Most expenditure is for salaries,
administration and logistics.

The scope of public service delivery is limited by the availability of local revenue.
Although Somalia was highly dependent on foreign sources of funding in the 1980s, with
100 per cent of the development and 50 percent of the recurrent budget financed by
foreign loans and grant, Somaliland has in recent years had to rely on its own sources of
funds. Somaliland has had a revenue collection system in place for over 10 years.
Although low, revenue is on a rising trend: Government revenue rose from $1 million in
1994 to $19 million in 1999; it then fell to $13 million in 2003 largely because of the
embargo imposed by the Gulf States on the importation of Somali livestock. Expenditure
rose from $11 million in 1998 to $24 million in 2002 and then fell to $13 million in 2003.
The cost of financing elections and absorbing several hundred thousands of refugees from
a reduced budget has limited the scope for expanding expenditure on other public
services. Because of these pressures there were delays in paying the salaries of soldiers
and parliamentarians in 2003, and in government subsidies to district councils. However,
according to Bradbury, the Government is confident that it can increase revenue to $60
million (Bradbury, 2003).

Cabinet and policy process. The Cabinet, which includes all ministers and their
deputies, meet every Thursday for one to two hours. Two to five items are on the agenda.
The memoranda to be discussed are written according to a standard format and circulated
three days before the meeting. The Cabinet agreed to abolish plastic bags after a 15
minute discussion. Specialized cabinet committees meet on the Wednesday before the
full cabinet meeting. The budget is prepared by the Ministry of Finance and then
presented to the Cabinet; we were told that ministries provided little input. There is
provision for a mid-term review of the budget, but it does not in fact take place.

Civil Service Commission and staffing. The Civil Service Commission, which was
established in 1993, manages staffing in the civil service. Its functions include
recruitment, setting salaries, and discipline. The Commission is led by a Chairman and
a Director General. Departments include establishment and personnel and recruitment
and training.

The CSC‟s 2005 to 2007 reform program aims to eliminate overstaffing, in particular at
lower levels, attract well qualified senior staff, carry out functional reviews, and address
issues of poor performance due to a lack of management skills, particularly in revenue
collection, and financial and human resources management (CSC, Three Years Action

Plan for Somaliland Civil Service Reform for 2005-2007, January 2005). The
Commission appreciates the need to separate surplus staff to create the funds needed to
raise pay for key technical and professional staff. The reform process is as follows:

           1.   Review structures of ministries and agencies
           2.   Review functions of ministries and agencies
           3.   Carry out job analysis
           4.   Prepare job descriptions
           5.   Formulate an appropriate establishment
           6.   Submit the proposals to the Cabinet
           7.   Propose new job grades and salary scales
           8.   Solicit Government commitment to the reforms.

The Cabinet agreed to the following:

   1.   Reductions in staffing of 30 per cent
   2.   New salary scale
   3.   Intensive training programs
   4.   Establishment of a personnel records systems to track performance
   5.   Development of performance standards and an appraisal system.

The reforms were piloted in the Ministry of Finance. Following the review of the
establishment, the formulation of functions, job analysis, and the preparation of the new
job descriptions, staff were examined by a committee of representatives of the CSC and
the Ministry. About 1500 surplus staff were retrenched and 500 ghosts identified. No
severance payments were given. Staff in ministries only received a pay increase after the
restructuring had taken place, which provided a good incentive for ministries to agree to
go through the restructuring process.

The review set the number of departments in most ministries at three: administration plus
two subsectoral departments. Education and Health were exceptions, each with five
departments. Bicker‟s survey found that 81 per cent of ministers and directors general
considered the new structure to be effective.

Current staffing is shown in Table …. The table shows that the CSC is responsible for
staffing autonomous agencies and even the staff in parliament. Twenty per cent of staff
are women, including one DG, 6 Directors, and 21 Heads of Section. Thirty per cent of
the staff are in Education, the largest ministry, and 15 percent in Health.

Table …. Somaliland, Staffing by Ministry, 2004

Ministry                                     Numbers
Education                                    1956
Finance                                      403
Agriculture                                  98

Commerce and Industry                    101
Interior                                 109
Public Works                             144
Attorney General                         39
Auditor General                          51
Sports and Youth                         54
NDC                                      33
Supreme Court                            17
Information                              86
Family Welfare and Social Affairs        16
National Tender Board                    14
Mineral Resources and Water              77
Baanka Somaliland                        283
Somaliland Electricity Agency            124
Hargeisa Water Supply Agency             406
National Printing Agency                 39
Port Authority                           482
National Environmental Research      and 7
Health and Labor                          1022
Posts and Telecommunications              87
Justice                                   232
MRR&R                                     62
Foreign Affairs                           22
National Planning and Coordination        29
Livestock                                 130
Religious and Endowment                   36
Culture and Tourism                       94
Fishery and Coastal Development           72
NDA                                       19
Presidency                                64
Houses Coordination                       6
CSC                                       29
Rural Development and Environment         98
Civil Aviation                            122
House of Representatives                  25
Defense                                   23
House of Elders                           28

Total                                     6739

Source: Civil Service Commission, February 2005

The numbers have grown over time. The total number in the civil service and
autonomous agencies, but not including parastatals, has risen from 4649 in 2001 to 5332
in 2004.

More personnel are supported by the public payroll than shown in the table. In the year
2001/2002, the latest for which we have data on the overall total, more than 26,000
people received some form of direct income from public service employment. These
include 4,649 civil service staff employed by central government (Civil Service
Commission 2003), approximately 4,000 district and municipal employees, 17,500
security personnel, plus employees of the Central Bank and Berbera Port. Then as now,
aside from the security services, the ministries of Education, Health and Finance are the
largest employers, accounting for 62 per cent of public employees.

The CSC is responsible for training civil servants. A Civil Service Training Institute will
open shortly with UNDP funding. Little training has taken place over the past three
years as UNDP reduced its support for short term training. The Chairman of the
Commission told the team that funding is now needed for a vocational training institute.

The Commission is not responsible for staffing local government; that is the
responsibility of the Ministry of the Interior and the local governments themselves.
However, the Commission is helping some local government to prepare downsizing
plans: Hergeisa is such a case.

Local government. Civil administration covers 80 per cent of the territory, with elected
councils in 19 out of 23 districts. Formal and judicial policing systems operate in these
councils, where central government funds the salaries of civil servants, including teachers
and health workers.

Under the Regions and District Law of 2002, Somaliland is divided into six regions,
which are divided into districts. A Governor appointed by central government chairs a
regional council consisting of the regional government departments and the District
Mayors. District Councilors, who are elected, select the mayor. Social, Security, Finance
and Land Distribution Committees report to each District‟s Executive Committee, which
is chaired by the Mayor. The District Councils are responsible for local revenue
collection, town management, security, public works, the environment, sanitation, health
and education. The main service that District Councils provide is sanitation and rubbish
removal. Some councils do contribute to education and health by paying for the water for
schools and rubbish collection for schools and hospitals.

One problem faced by the Districts is that their responsibilities have expanded beyond
their fiscal capacity. Responsibility for the provision of social services was moved to
the Districts, either directly or through privatization of services such as water, while
revenue was on a declining trend. Districts are largely dependent on local sources,
including customs revenue where there is a port, and revenue raised on property,

businesses, land sales, advertising billboards and the like. The Government does provide
a subsidy from a 12.5 per cent tax on trade and an additional subside for Districts with no
ports. According to Bradbury, local council are exploring ways to increase local revenue
from business, land and animal slaughter taxation.

The team visited two municipalities, Hergeisa and Berbera. As with other councils with
less of an economic base, the resources available to Hergeisa Council are insufficient to
meet its responsibilities. The elected council has been in place for two years. The 25
councilors selected the Mayor. There are no grants from central government. The main
sources of income are the annual property tax, a one-time tax on setting up a business, a
daily tax on small businesses, and a one-time land user fee. Monthly revenue is $70,000.
The Council used to receive part of the livestock fee collected by central government at
checkpoints around the city, but this has been discontinued. The Council does have about
800 properties on which it earns rent. These include houses and market stalls. The
Mayor and Councilor told the team that the Council is greatly overstaffed. Although the
establishment of 900 should be cut in half, they were reluctant to do so because of the
high levels of unemployment. Revenue is so low that the Council has problems in paying
all the staff. Pay averages $50 a month, with directors paid $100. Councilors are paid
sitting allowances. The council has little funding to support primary education, as it is
supposed to. Basically parents have to pay for the education. An attempt to increase the
local tax rates was vetoed by Parliament. Property tax revenue is on a rising trend thanks
to a cadastral survey supported by UNDP, which will by next month have registered all
properties; the Council used to be able to collect from only 20 per cent of properties. The
Mayor estimated that revenue would have to be increased fourfold if the Council were to
meet all its obligations, which are increasing as destitute refugees and nomads pour into
the city.

Sanitation is one service that works reasonably well in Hergeisa. Garbage collection is
jointly administered by the Council and NGOs. The Council gives two trucks to NGOs
working in each of five districts. The NGOs hire the staff to carry out the collections,
since Council staff were found to be very inefficient. Each NGO is paid $4000 per month
by the Council (thus using one third of the council‟s monthly revenue).

Water and electricity are provided by both the public and private sectors. The public
company provides for about 30 per cent of Hergeisa‟s electricity needs; private
companies the rest (the Ambassador Hotel is one such company). Water supply is drawn
from eight wells; some so far out that trucks are used bring the water into the city. An
additional four wells need to be rehabilitated. The owner of the Ambassador Hotel is
currently trying to do a deal with the Director of Hergeisa Water to bring water from the
nearest well, 2 miles away, to the area around the hotel.

Because of revenue based on the economic activity of the port there, Berbera is in slightly
better fiscal shape. Ten per cent of port collections go directly to the city. But Berbera
too is overstaffed. We were told that half the 517 staff do not work. Berbera is able to
provided small subsidies to the police (providing water and electricity), hospitals and

schools (for example, funding 18 teachers). Funds are also available for street lighting,
road repair and electricity.

Governor of Sahil. Sahil consists of Berbera plus four districts. Funding for the
Governor‟s office comes entirely from central government even though substantial
revenue is raised within the region for the national treasury. Eighty per cent of the total
revenue earned for government as a whole by the region comes from the port town of
Berbera. Most districts can support themselves with their own revenue; very little central
government support is needed. The Governor has a small staff, basically a Vice Governor
and an Executive Secretary. The Regional Commissioner, who is in charge of security,
reports to the Governor. Although the Governor works closely with staff in the various
sectors that have representation at the regional level, these staff report to their ministries
in Garowe. The Governor has no development budget under his control even though he
is responsible for coordinating planning in his region.


Structure of the state. Under the 1998 Puntland Charter, the Regional State of Puntland
has a non-elected power-sharing government with an executive president, a nine-member
cabinet, a 66-seat House of Representatives and an independent judiciary. There is an
independent Council of Elders with advisory and mediatory functions. The number of
cabinet posts has been increased to seventeen.

A Law on Local Councils was passed in August 2003. Under the new law, mayors would
be elected not, as before, appointed by central government. Elections for the local
council in Puntland will take place in March, 2005. Councilors will be elected by the
elders in the districts. The larger districts will have 25 councilors; medium sized ones 21,
and the smaller 17. The councils will have an executive committee of seven members,
with mayor and vice-mayor paid salaries; others receive sitting allowances. Elections
will be at four-yearly intervals.

Scope of public services. Puntland‟s public expenditure is also focused on security. In
2003, 78 per cent of the budget was spent on security, military salaries, logistics and fuel,
with the remaining 22 per cent on civilian salaries. Taking all sectors together, salaries
and allowances accounted for 66 per cent of expenditure in 2002 and 61 percent in 2003.
Almost all the budget is for recurrent expenditure; only 4 percent was for capital
expenditure in 2003. The Presidency, which is responsible for paramilitary troops, was
responsible for 40 percent of expenditure (PRDC, 2004). Bradbury reports NGO claims
that only 3 per cent of the budget being spent on education and health (Bradbury, 2003,
page 54). Data collected by PRDC from the Ministry of Finance show a similar 2 per
cent allocated to those sectors in 2003 (PRDC, 2004). Recently the cost of the
reconciliation talks has absorbed a considerable proportion of revenue.

Data are available from the Socio-Economic Assessment of Puntland (PDRC 2004) on

access to services. The gross enrolment ratio for primary school children is only 11 per
cent. The figure for boys is slightly higher than for girls. Those in urban areas are better
than those in pastoral communities. Most leave after 5th grade. Only 2, 868 children were
enrolled in secondary schools in 2002-2003, half of then in one region, Bari. In that year,
38 students attended one of three new tertiary institutions. A new teachers training
institution will open in 2004-2005.

Access to health care is also poor. There are 16 hospitals, with 55 beds, 16 primary
health care centers, and 25 health posts. The quality of service is said to be substandard
(PRDC, 2004, page 35). Frequently drugs are not available; also they are often used
inappropriately. Sixty per cent of the 950 health staff are community health workers or
traditional birth attendants. Human health doctors account for only 6.5 per cent of all
health personnel. One third of the staff operates within the Nugal region, although most
are less qualified personnel. Most doctors operate private clinics as well as work in the
public sector. Private clinics are most frequently used in urban areas.

Access to water is particularly problematical. With rainfall ranging from 50 to 250mm
per annum, Puntland is a “serious water deficit” area. Less than 20 per cent of the
population are thought to have access to water year round. Half the population obtain
water from surface reservoirs. Some improvements are being made in the access to water
for urban dwellers, half of whom have direct pipeline connections. There are substantial
sanitation hazards in urban areas due to indiscriminate defecations and overflowing septic

Council of Ministers and the policy process. The Chief of Cabinet is the head of the
President‟s administration and secretary to the Council of Ministers (CM). He is
appointed by the President and confirmed by Parliament. The current chief is a
professional civil servant, although he has in the past been a vice minister. He is the
principal liaison between the President and parliament and communities. Departments
within the Presidency include protocol, administration and finance, and public relations.
All persons wishing to see the President must do so through the Chief. The Chief has
four staff, one of whom is a graduate. The weekly schedule for the President includes
meeting the public on Monday, meeting ministers and other high officials on Wednesday,
and the meeting of the Council of Ministers on Thursday. The meeting, which is attended
by all ministers and vice ministers (a total of 36 persons, a large group by standards in
other countries), usually lasts from 9 to 12. Ministers are not Members of Parliament.
Cabinet papers are circulated on the Tuesday or Wednesday before the CM meeting.
There is a standard format for these papers, which are generally 4 to 5 pages long.
Although there are no CM committees, there are a number of commissions, for example,
commissions for social and economic affairs. Ministers are expected to consult among
themselves prior to bringing proposals to the CM. The Chief reported that the CM met
five times to discuss one of the more important policy documents, the annual budget.
These were, he said, very difficult discussions. Prior to these meetings of the CM, all
ministries had discussed their own budget proposals with the Ministry of Finance.

Informality in government. Government in both states is characterized by much
informality, in other words a pragmatic rather than legalistic approach to solving
problems. We were given an example of this by the Puntland Chamber of Commerce.
When Chamber vigorously opposed the Government increase of 7 per cent in the import
export levy last year to meet costs recovering from the drought, the Government
rescinded the increase and instead accepted the Chamber‟s offer that individual
companies make voluntary contributions. These contributions ranged from $1,000 for
small companies, generally livestock traders, to $25,000 for larger ones, including the
telephone companies. Strong formal linkages between the public and private sectors
reinforce or provide opportunities for this informality. For example, 80 per cent of the
funding for the Chamber of Commerce, ostensibly a private sector institution, comes
from Government, which funds the positions of Secretary and Assistant Secretary.

Ministry of Labor, Sports and Youth and staffing. The civil service in Puntland is
managed by the Minister of Labor, Sports and Youth. Staffing by ministry is shown in
Table …

Table … Puntland, Staffing by Ministry, February 2005

Ministry                                       Numbers of Staff
Presidency                                     70
Auditor general                                26
State lawyer                                   6
Parliament                                     19
Finance                                        363
Internal Affairs (not including police)        112
Religious Affairs                              59
High Court                                     76
Livestock, agriculture and environment         64
Public works                                   120
Education                                      207
Health                                         418
Ports and fisheries                            143
Planning and international cooperation         57
Labor, sports and youth                        93
Industry and commerce                          37
Information                                    48
Local government and rural development         60
TOTAL                                          1981

Source: Ministry of Labor, Sports and Youth, 2005.

It is worth noting that parliament, the judiciary and the auditor general are treated as part

of the civil service. The Minister said that health, education, fisheries and finance are the
fastest growing ministries. These figures do not include the people in the militias, which,
according to the Ministry of Finance, would bring the total to about 11,000.

Little attempt is being made to address the admitted overstaffing issue – the fact that the
fiscal resources are not available fully to employ all the staff. The number of civil
servants rose from 1,141 in 2002 to 1,659 in 2003 (Ministry of Finance, 2004) and, as the
table shows, is now almost 2,000. Bradbury reports that there are alsosome 6,000
security personnel on the public payroll (Bradbury 2003).

The functions of the Ministry are: monitoring labor law compliance; education and
training; keeping statistics on employment; and recruitment for both public and private
companies. This last responsibility is quite unique; the Minister gave examples of
recruiting for remittance and construction companies. The recruitment process is as
follows. When a ministry or company needs additional staff, it writes to the ministry,
which then advertises and sets up a selection committee of two representatives from the
Ministry of Labor and two from the ministry or firm seeking staff. The Ministry checks
there is the ministry has sufficient budget to cover the salaries of the additional staff.
Committees are similarly set up to handle promotions and discipline. All promotions to
management positions have to be approved by the President; to executive positions, by
the Office of the President; and for clerical positions, by the Ministry of Labor.

The restructuring process that began in 2000 with technical assistance support from
UNDP was suspended because of political opposition to staff reductions and
preoccupation with the conflict with Somaliland. The objective at that time was to
professionalize a politicized public service. The functions of ministries were reviewed,
rationalization proposals made, and job descriptions prepared for key positions. An
exercise comparing the qualifications of staff to their job descriptions was planned but
never implemented. The Minister and DG admitted that many staff do no work at all.

The Minister has discussed the future of the civil service with representatives of the TFG
in Nairobi. He reported that the plan is that the various civil services would stay as they
are now for 2 ½ years and then change to accommodate the new national government.

Ministry of Finance. The Ministry is divided in 6 departments: the DG‟s office,
Budget, Administration, Statistics, Revenue and Customs, and Regions. Of the 350 staff,
65 are in the capital, the rest in the regions. The sector ministries‟ own accounting staff
do not report to the Ministry of Finance but to their own ministries. Out of the 24
billion/- monthly budget, 68 per cent is for salaries and allowances. Procurement over
50,000/- is carried out by Finance; procurement less than that by the ministries.
Ministries prepare their budget submissions by September and Finance presents a
consolidated budget to the Council of Ministers in October/November. The budget was
approved by Parliament on the day the team met the Ministry, February 15, 2005.
Parliament can actually change budget proposals (US style) and not simply vote for or
against the actually allocations proposed by the Government (Westminster style). The

Ministry reported that arrears are substantial as commitments outstrip revenue. The flows
of revenue fluctuate: September to November, and March to May are good months.
There are no certified public accountants in the public service. However, bookkeeping
must be good since the accounts are current (uniquely in Africa).

Ministry of Planning. The Ministry is responsible for the preparation of development
plans, the implementation of which would be dependent upon donors funding since there
is almost no funding for capital expenditure from the annual budget. The Ministry is
recruiting a technical team of staff and outside experts to prepare a five-year plan.

Ministry of Local Government and Rural Development. The Ministry has 65 staff, 43
of them in the capital, Garowe. The Minister is Chairman if the Election Committee for
the local elections and is responsible for training new councilors. He distinguished three
categories of districts: category A that can raise enough revenue to cover all its salary
costs; B that can cover half the costs; and C that is entirely dependent on central

Ministry of Commerce.          The Ministry‟s main responsibility is to coordinate and
promote trade, internal and external. His 40 person staff is divided into a number of
departments: administration and finance, commercial promotion, women‟s‟ promotion,
frankincense, and foreign trade. More than 20 of his staff have degrees (only Planning
and Justice have more well qualified staff, according to the Minister). The Ministry has
staff in all six regions. The Ministry works closely with the Chamber of Commerce, for
which the Ministry provides 80 per cent of its funding.

Governor of Nugal. The Governor‟s responsibilities exceed their human and financial
capacity. A Governor is responsible for security, social services, coordination between
villages and districts and the center, and special needs, but, in the case of the Governor of
Nugal, he has a budget of only $800 a month and 15 staff, none of them very skilled to
implement those resposibilities. The Governor operates through three committees:
peace, development and executive affairs. Members are taken from outside as well as
inside the governorate. Disasters take up most of the Governor of Nugal‟s time. Only
one billion/- was provided for the whole of Somaliland to help in last year‟s drought. No
funding has yet been made available for tsunami victims.

South Central Somalia

The mission was not able to visit South Central Somalia. This section is based upon one
of the author‟s, Abdusalem Omer‟s, experience of this region.

Political factions and militia leaders have established administrative structures in the
region. The TNG attempted to set up regional and district administrations in some areas,
but none is functioning effectively and delivery services to the public (UNDP 2004).
Islamic Sharia courts have established a rule of law a number of areas. Traditional
authority operates at the district level in most parts of the region.

The majority of districts and urban areas receive limited social services. In 2002, 286,000
children were enrolled in 1,192 primary schools, girls making up 36 per cent of the total.
There were on average 31 students per teacher (UNICEF 2003), although CRD questions
some of these data since they imply higher enrolment than during Siad Barre‟s time (CRD
2004). There are a number of tertiary institutions, including the Somali Institute for
Management and Administration Development and the University of Muqdisho. In 2003,
there were 23 hospitals and 35 qualified doctor in the region. Health care centers suffer
from shortages of medicine and qualified workers.

The situation in each of the regions is described below:

1. Mudug and Galgaduud regions - The governors and district commissioners appointed
   under the UNOSOM in 1993 still claim authority but with no visible authority or
   legitimacy to govern. There are no structures for providing public services but parallel
   power structures run by elders and Islamic Sharia courts operate in the region.
2. The Hiran region – No elected authority exists and situation is similar to the one that
   pertains in Mudug and Galgaduud regions. The Governor that was appointed in early
   1993 still claims to be the governor without any authority. Likewise, traditional
   leaders and an array of other civic groups and Islamic sharia courts maintain some
   security. Neither the governor nor any other body in the region has the capacity to
   delivery any social services
3. The situation is somewhat different in Middle Shabelle region. Due to its proximity to
   Mogadishu and the high level of resources in the region, the authority of this region is
   contested by different factions, but currently controlled by one Mr. Mohamed Dheere.
   The security situation in the areas under his control is very good; his militias maintain
   law and order, sometimes using excessive force on the people and impose heavy taxes
   on the business community.
4. The Banadir region that includes the capital Mogadishu remains a divided city
   contested by various warlords. However the capital is also the seat of a very vibrant
   commercial sector, vibrant and expanding educational institutions and a host of
   Sharia courts under different jurisdictions. It‟s also the seat of some remnant of local
   police under the defunct TNG and several sea and airports controlled warlords.
5. In the Lower Shabelle region, serious conflict over the control of the rich agricultural
   and marine resources continues to prevent formation of a regional authority.
   Different political and militia groups claim ownership of various pieces of land and
   the control of the Merka port. (more is needed here)
6. The regions of Bay and Bakol, established a well-structured regional authority under
   UNOSOM and later by the RRA. However, the administration collapsed twice, in
   1996 after Militia loyal to Aidid occupied the region and again in 1999 after
   differences within the RRA lead to fierce fighting within its ranks. However, the
   regions remain moderately secure, with some security forces and local administration
   under the control of Shati Gaduud, the de facto leader of the RRA.
7. In Lower Jubba, the regional authority set up under UNOSOM collapsed in June
   2002, after the control of the region was contested between the JVA and local

   populations. The port of Kismayu and forest resources continues to be contested by
   various factions. It has changed hands among different factions many times and
   remains highly insecure.
8. The Middle Jubba and Gedo regions have similarly seen little peace or any semblance
   of organized administrative authority since the civil war started. Gedo region has
   experienced military incursions from Ethiopia (ostensibly to pacify the common
   border area, of any element of Islamic militant groups).

Somalia in 1989

This section, written to give a perspective on the country as a whole, is based upon the
World Bank‟s 1991 Country Economic Memorandum.

In 1989 the civil service had between 45,000 and 50,000 staff, up from 20,000 in the mid-
1970s. The numbers were thought to be excessive on the grounds that expenditure had
declined by annual average of 0.4 per cent during the period in real terms. A public
sector employment report of 1984 established a goal of reducing the numbers by 20 per
cent. A 1990 study by USAID concluded that civil service overstaffing was about 60 per
cent. The Bank team reported that high level bureaucrats concurred that overstaffing may
be as much as 50 per cent (World Bank 1991). The Bank proposed cuts of 40 per cent to
create the funding needed to raise salaries and increase the allocations for operations and
maintenance. This would bring the total to 27,000 by 1995. The Bank hoped that the
number would stabilize at 25,000 thereafter. This would bring the wage bill as a
proportion of GDP to 3 percent, which would make it extremely low by current (2005)

The trend was already towards shifting expenditure for economic and social to security.
Total expenditure on social services fell from 16 per cent in 1974 to 4 per cent in 1988
while “general services,” which is primarily defence and security, rose from 60 per cent to
85 per cent. The proportion of expenditure going to education fell from 14 per cent in
1978 to 2 per cent in 1987; health‟s proportion fell from 6 to 1 per cent. Over the same
period the supply of water and electricity and the quality of the roads declined largely
because of underfunded maintenance expenditures. (World Bank 1991).

4. Future Public Service

The Committee on Economic Recovery, Institution Building and Resource Mobilization
has proposed strategies to rehabilitate and develop public administration in Somalia (3rd
Draft Report, March 2003). Four key needs are identified to be:

       1. A lean and efficient, corruption free and merit-based system that can be
          sustained given extremely limited domestic revenue
       2. Adequate remuneration to increase efficiency
       3. Decentralized system, and
       4. Capacity building of staff at all levels of government.

A bi-cameral parliament is proposed along with an executive branch of government
headed by a President and Prime Minister, with 20 ministries, and six autonomous
agencies, with a $227 million two-year budget for public administration. The report also
proposes budgets for “priority actions” in each of the sectors: $16 million for health,$20
million for education, $56 million for roads, $53 million for seaports, $29 million for
civil aviation, $60 million for water and sanitation, $31 million for urban services, $32
for power and electricity, $12 million for telecommunications, $23 million for
agriculture, $50 million for crops, $23 million for livestock, $28 million for fisheries, $13
million for natural resources management, $48 million for peace building and census, and
$84 million for the police force, with a grand total of $1.1 billion for the two year period.

The report includes an annex proposing staffing and salaries for the new public
administration. There are to be 450 Members of Parliament, 20 ministers and vice
ministers, and about 9,200 civil servants, with additional 120 or so staff in the
autonomous agencies, and about 10,000 in the police force. The civil servants‟ total
includes 1,144 doctors and medical staff, and 6,605 teaching and support staff. Thus the
civil service would be a little smaller than the one proposed by the Bank in 1991.

The TFG Government plans to:

               Establish mechanisms for clear communication and full disclosure of
                information to the public to ensure transparency in government.

               Establish and reactivate structures for law reform to strengthen and
                consolidated the judiciary in the country.

               Ensure transparency in recruitment and promotions, to increase the
                representation of women and other marginalized groups in decision-
                making positions.

               Establish and strengthen systems for consensus building and ownership of
                decisions of governance.

               Establish and strengthen mechanisms for the decentralization of power and
Rules and regulations that stipulate the scope and conduct of the civil service have been
drawn up and a national civil service commission has been created with the task of
drawing up the following:

a)   The overall manpower policy of the nation;

b) The objectives and program for each sector.

c)   Effective utilization of all levels of trained personnel;

d) Conservation and development of existing staff resources

e)   Provision of adequate opportunities and incentives for achievements

f)   Linking manpower strategy to education planning and economic          development

The Transitional Federal Charter adopted at the conclusion of the Nairobi peace process
has been linked to the situation in the various self-governing regions. In the context of
present decentralized federalist system of government adopted for Somalia, the TFG
charter provides for four levels of administrative hierarchy where power can be exercised.
Hence there are four levels of providing public good to citizens under article 11. These

               1.   The executive arm of the Transitional Federal Government
               2.   State governments (regions federated according to free will)
               3.   Regional administration
               4.   District administration.

The charter also states that TFG shall promote and develop the state governments,
regional and district administration. The structure of public sector envisaged in the
Charter is perhaps similar to the Ethiopian system, with an executive prime-minister and
president as symbolic head of state. Over the last 14 years when there was no central
government, the regions accumulated power as the centre became defunct. Hence the only
experience of public administration was exercised at the local authority level. While the
responsibility of developing the legal and regulatory frameworks for all sectors, including
the public sector should be remain at the National Transitional Government level, the
delivery system can only be reasonably organized at regional (state) level with the
exception of national defense, foreign affairs and to a lesser extend management of
national assets such as land, perhaps implied in article 71 of the charter; it states;

               „The Transitional Federal Government shall endeavor to repossess and
               restore to the state, all public properties, either movable or immovable,
               within or without the country‟ Article 71 of TFG charter.

The conditions necessary for the implementation of these agreements have been discussed
by members of the TFG. To the extent that institutions become sustainable only if
adequate resources are available to operate and maintain them, the hierarchical delivery
system of public goods envisaged in the charter presents several possibilities for
enhancing the public sector. Firstly, there is need to focus and limit public sector
operations to a minimal number of essential areas. Even within the chosen areas, the
depth and breadth of involvement should carefully be weighed against resource
availability and the existing capacity of the sector. Under such consideration, there is also
the need to prioritize the essential ones such as preservation of law and order, security of
the nations and its borders and foreign affairs, as the first level public institutions.

The second level public sector issues are the provision or the regulation of the social
sector, especially in education, health and basic infrastructure development (mainly
public roads). To provide resource for the social sector, cost recovery system and efficient
systems of allowing the private sector to deliver social goods be put in place, in addition
to expanding the tax base to fund future expansion of the services.

The Synthesis Report, Conflict in Somalia: Drivers and Dynamics, highlights key issues
that will have to be addressed by a future public service for Somalia (World Bank,
September 2004). The report points out that the three regions have achieved varying
levels of success in governance:

      South Central: The armed factions have no real commitment to accepting a state
       structure that does not give them a prominent role. Non-state actors are providing
       governance. Sharia courts and customary laws provide justice.
      Puntland: The regional administration provides law and order, although the
       stability could be diminished if the administration becomes exclusionary,
       authoritarian and corrupt.
      Somaliland:      The region had budding democratic institutions, equitable
       governance, but suffers from limited access to international assistance.

Overall, the report concludes that because they see the state as an instrument of
accumulation and exploitation, many Somalis are suspicious of government.

The report urges attention to be paid to the development of non-partisan governance. To
militate against the inevitable political struggle around state-building, it is important to
establish non-partisan public service institutions. The report lists customs, revenue
collection, justice, law enforcement and internal and external security institutions as
particularly important in this regard. The new central government must resist the
temptation to cabinet post for every constituency represented in the coalition.

The report recommends that the new government and public service learn from and build
upon what works now: the relative successes of public institutions in the north and the
effectiveness of some community and NGO activities.

The team met with a number of members of the TFG, both ministers and
parliamentarians. Some members of the TFG appreciate the need to take some immediate
and very practical steps to put in place a public service able to implement the first phase
of the Charter. They believe that even if the eventual aim is to have decentralized
government, a strong center needs to be established to provide informed leadership for
the implementation of the Charter. This center would then be in a better position to set
up what one minister called “rudimentary government,” the basics as laid out in the
Somalia Emergency Budget Support Project (SEBSP). Deliberations about the longer
term arrangements could then take place, answering questions such as: How should the
TFG should relate to the existing states in the north, the lack of government in the south?
What form should federalism take after the mid-term review in two and a half years time.

Should there be common or multiple systems? Should Puntland and Somaliland run their
civil services as they do now, each in a different way, or should systems such as hiring
staff and accounting be common to all parts of the country? Should there really be over
forty federal ministries in a decentralized state? Would it not be more effective to cluster
ministries into, say, social, economic, federal and international affairs? Would it not be
more effective to supply common services to these clusters of ministries rather than each
have its own accounting, procurement, maintenance, IT and even clerical services,
especially with such limited budgets? Should the TFG and its civil servants not think
programmatically and in terms of results to be achieved, to implement the Charter and to
improve service deliver, rather than in terms of structures and responsibilities? Some
ministers believe that starting from zero presents an opportunity to put in place a model
decentralized government that would be more effective in serving its citizens than any
previous government.

Much of this thinking has been captured in the Rapid Assistance Program for the first 12
months and the associated UNDP Somalia Emergency Budget Support Project (SEBSP)
for the TFG. Budget support is proposed to strengthen economic management capacity
and systems and procedures for civil service management, as well as pay the salaries of
executive and legislative branched, the policy and some judges, and provide logistical
support over a six month period, while longer term plans are prepared by TFG in
collaboration with the donor community.

5. Civil Service Pay

Low pay was identified as a serious problem by all the ministers, governors, mayors and
officials the team met. The challenge will by to raise pay while at the same time avoiding
taking up the whole of the recurrent with wages and salaries, which is just about the case
now. Thus raising pay will of necessity require retrenchment to create fiscal space. The
challenge is not new. The Bank team preparing the Country Economic Memorandum in
1990-91 addressed the very same set of issues.

Somalia in 1989

The most systematic analysis of the need to improve pay incentives and at the same time
rationalize the civil service of Somalia as a whole is reported in the World Bank‟s 1992
Country Economic Memorandum.

The Bank‟s 1990 CEM expressed considerable concern about the very low wage levels.
While employment grew from 1974 to 1989, the wage bill fell from 3.7 per cent of GDP
to a very low 1.1 per cent of GDP, well below the levels in other developing countries
such as Malawi and Kenya at that time. Real wages, averaging $3 per month, had
declined to 6 per cent of their 1974 levels. The consequence was that staff either left the
public service or worked very short hours, while seeking other sources of supplementary
income. The best staff were attracted to donor supported projects, some of which paid

thirty time public service salaries. The projects themselves often supplemented the
salaries of civil servants in departments involved in those projects. Such supplements
doubled the wage bill.

The CEM suggested guidelines for the medium term. Salary supplements were to be
phased out over time. Retrenchment was to create the resources needed to raise the
salaries of the remaining staff. Cuts in staffing of between 40 and 60 per cent were
proposed, to reach a target of 25,000 by 1995. Positions were to be eliminated on the
basis of a job evaluation exercise. Key service delivery workers such as teachers were to
be exempted from such an exercise. The salaries of the remaining staff were to be raised
to their mid-1970s levels in real terms, since studies carried out them determined those
levels to be adequate. This would mean that salaries would rise by an annual rate 103 per
cent from 1991 onwards, after a larger immediate increase. The wage bill would rise to 3
per cent of GDP. This percentage can be compared to 8 to 9 per cent for Kenya, Zambia,
and Mozambique.

The report recommended that the salaries of mid and upper level staff increase at a faster
rate than the rate for lower level staff. To apply the average rate of increase to lower level
staff would bring their salaries to above market levels. The recommendation was based
upon the falling compression ratio rather than on reference to salaries in Somalia‟s small
(formal) private sector. The ratio of the highest to the lowest grades had shrunk from 9.1
to 1 in 1974 to 5.7 to 1 in 1989. This ratio can be compared to 39:1 in Botswana, 14:1 in
Zambia, 17:1 in Tanzania and 18:1 in Mozambique.

The report considered the impact of the retrenchment employment on household and the
local economy. It was estimated that a reduction in civil service employment of 20,000 in
the Mogadishu area would only increase unemployment in the area by an insignificant 1
per cent. The report also referred to a the Household Budget Survey for Civil Servants
prepared for the mission to support the view that the impact would be minimal since
government pay constitutes less than 10 per cent of household expenditure. The report
did not consider the political impact of the retrenchment. Recent studies on pay reform in
developing countries have concluded that programs such as those proposed for Somalia
only seem to succeed in countries with very strong political leadership, a lack of multi-
party democracy and weak or non-existent trade unions [see K.Kiragu and R.
Mukandwala, Tactics, Sequencing, and Policies of Public Service Pay Policies in
Developing and Middle Income Countries, DFID, December, 2003].

The report estimated that the separations of 15,000 staff [why 15,000 not 20,000?] would
cost about $3.3 million over the period 1992-93. The cost is based on the legal
requirement that retrenched staff be paid one month‟s salary for each year of employment.
The figure might well be lower since it is based on average salary levels yet lower grades
may be more likely to be retrenched. However the report also suggested that the total cost
of the retrenchment might be higher if possible additional incentives, the cost of
administering the program, and retraining cost were factored in. This might bring the total
cost up to $10 to 15 million. The report concluded that since external funding might be

forthcoming to cover these costs the impact on the national budget would be minimal.
[Couple of points on this: The Banks‟ rules have been changed since the time this report
was prepared making it possible for projects to fund separation; the Bank could
previously only support separations through adjustment operations. I actually was the
first person I the Bank to use this provision, in Zambia. That said, the strong preference
in the donors community today is to fund separations through budget support.]

The current mission did not explore this issue in as much depth: time did not permit this.
We did however try to collect up-to-date data on salaries, as shown below.


The Bradbury report concludes that “most public service employees, including the most
senior, are not earning a living wage.” Thus little has changed since the time of the report
for the whole of Somalia referred to above. Bradbury gives the following data on

Position                 Somaliland Shilling        US$ equivalent
Minister                 2,000,000                  229
Parliamentarian          1,200,000                  138
Judge                    900,000                    103
Policeman                113,000                    13
Mason (master)           2,610,000                  300

The public service salary levels were set in the first, 1993, budget and have changed little
since then. Since there has been substantial devaluation of the Somaliland shilling,
salaries have fallen greatly in real terms. The policeman in the above table is earning
much the same as the average public servant referred to in the 1989 report referred to

It is worth noting that a policeman‟s salary is less than the per capita income for
Somaliland and Puntland (estimated to be $226 by Bradbury). Civil servants are usually
paid salaries equivalent to some multiples of the per capita income, reflecting the fact that
the lower grades are well off compared to the rest of the population. The African average
ratio of civil servants salaries to GDP is about 6:1; Sudan‟s at 3.5:1 is closer to the
Somalia figure.


Salaries levels are very low compared with the private sector. A carpenter can earn as
much as a minister, as shown in Table … The table shows that only ministers and DGs
are paid allowances, for rent, for example. Staff in autonomous agencies, including the
Central Bank and the Office of the Auditor General, are paid according to the same civil
service scales.

Table … Puntland, Civil Service Salaries, Monthly, 2005
(Somali shillings, million)

Position                   Salary   Allowances
Minister, Vice Minister    2.225    0.775
Director General           1.62     0.78
Head of Section            1.35     0
Head of Unit               1.08     0
Clerk                      0.81     0
Driver                     0.81     0
Messenger, cleaner         0.54     0

Carpenter, private sector 3.0
Source: Minister of Labor, Sports and Youth, February, 2005

6. Training and Capacity Building

The representatives of the public and private sector interviewed by the team identified
capacity weaknesses as the most serious problem, alongside the international recognition
issue. Almost every minister and mayor the team met presented the team with a list of
capacity building needs.

Capacity should be defined as the inputs needed to achieve results. Thus capacity
building can include putting new systems and equipment in place as well as training.
Both Zambia‟s and Ethiopia‟s Public Service Capacity Building Projects have adopted
this broad definition of capacity. Some would also include improving incentives as part of
capacity building. It is possible to think in terms of a matrix such as this:

Activity               Structures             Processes              Incentives

The left hand column lists the three principal functions of government. The columns
define what need to be done: reform structures, processes and incentives. Had time
permitted the team could have filled in the boxes for each part of Somalia, first to define
the situation as it is now and then for how people would like the situation to be in the
future. Such a device was used to design Sierra Leone‟s post-conflict Institutional
Reform and Capacity Building Project, now being implemented.

Turning to what we learned about the capacity situation in Somalis, it is clear that the
coverage and quality of the public sector services was poor and deteriorating by the time

the government collapsed in 1991. During the absence of government, such services
deteriorated further as the pubic assets were destroyed and looted in the civil war,
especially in the south central region. In Somaliland and Puntland regions, asset
destruction occurred in the brief period following the collapse of the state but did not
designate all together as did the south central region. Public assets in these two regions
fell into disrepair. Thus there is need for huge resources to bring assets in the social sector
to their pre-war level. Health and education facilities that have been rehabilitated by
private sector need regulatory mechanisms and many others need fresh resources.

A Training Needs Assessment for the Somaliland Civil Service was prepared for UNDP
in January 2004 (Mike Bicker, 2004). Bicker concluded that there are widespread
training needs in the civil service, from the top to the bottom of the civil service, covering
a wide range of subjects. Twenty one out of the 27 ministries and agencies interviewed
provided no financial support for the training of their staff.

Bicker links the training needs to general improvements in public sector management.
He asserts that training programs will only be effective if a number of structural and
institutional issues are addressed first. These include the following:

                Completion of the review and rightsizing, resulting in the consolidation
                 of departments and agencies so that they are large enough to be effective
                Preparation of job descriptions, including minimum requirements and
                 training needs
                Establishment of a pay structure adequate to reward staff
                Development of a promotion system linked to performance
                Introduction of a performance monitoring system
                Development of strategic plans by all ministries (Bicker found that only
                 10 out of 25 ministries had a mission statement and 13 had a strategic
                Preparation of a comprehensive training plan for the civil service, which
                 would be the basis for donor support
                Devolution of training budgets to ministries and agencies
                Greater commitment to support human resource managers in ministries
                 and agencies
                More sharing of experiences of best practices among ministries and

The three main reasons given why ministries and agencies found it difficult to achieve
their objectives were a lack of financial resources, capacity and motivation.

Ministers, DGs and HR Directors identified revenue collection, management, accounting,
computer skills, administration and foreign languages at the most common training needs.
Bicker‟s report includes an indicative civil service training inventory.

The report provides useful information of management practices in the Somaliland civil

service. Few ministries and agencies have M&E systems, although almost all receive
feedback on performance from the public, mainly of course complaints, but occasionally
suggestions for new initiatives. The managers at least think that managers and staff work
well together. They reported good teamwork and staff involvement in decision-making.
The staff of course said that there was room for improvement in both cases. Managers
did identify a number of problems with their staff, the key ones being a lack of motivation
or commitment, poor management skills, inadequate computer skills and a lack of
specific job training. The managers perceived their own weaknesses to be much the

The survey includes data on the educational backgrounds of senior staff. Thirty one of 48
departmental directors and a similar proportion of section heads had had tertiary
education. Most other staff had no more than secondary education. Most managers had
undergone no training over the past two years. Most of the training for those who had
benefited had been short courses; none had benefited from any medium to long term

Bicker reports on a focus group of members of the general public who were asked for
their views of civil servants. Almost all characterized civil servants as inefficient, tardy,
impolite, unhelpful, dishonest and lacking in creativity.

7. Community Driven Development

The team encountered many examples of the private sector and communities stepping in
to provide services where the public sector lacked fiscal capacity, from the private
provision of water and power, and parents rebuilding schools and paying teachers
salaries, to NGO‟s collecting garbage. Building upon this community energy is probably
one of the best hopes for improving service delivery in the future.

Many structural changes have taken place in Somalia in recent years, altering the
traditional public sector organizations, economic and territorial reality of the country,
with an obvious bearing on present and future forms of governance and public sector
formation. Especially where relative peace and stability have maintained some form of
continuity, like in Somaliland and Puntland, a powerful investment trend, mostly fuelled
by the Somali Diaspora and unregulated trade, is quickly driving the emergence of a „new
economy‟ with emphasis on regional trade and commerce, services, manufacturing and
urban housing.
Through out Somalia civil society organizations have evolved in varying degrees of
cohesion and effectiveness, mirroring, in different regions, the parallel evolution of public
institutions. In all cases, individual NGOs and their umbrella organizations have
managed to achieve a presence of fundamental value in all aspects of community life,
from support to economic recovery to education, health services, poverty alleviation, and
governance. In most communities including Somaliland and Puntland the weaknesses and
in some cases the absence of legal framework, fully functioning judiciary apparatus, lack
of civic participation in decision-making and full representation of communities‟ voices

is an obvious impediment that is evident across the continuum.

According to the NGO consortium handbook of 2003 (published by SACB), there are
over 65 local, national and international NGOs working in different sectors and regions of
Somalia. Some Umbrella organizations have established very wide networks, and have all
but taken over roles traditionally performed by government. Such organizations include
For Private Education Network Services (FPENS) (in the education Sector- curriculum
development, certification, monitoring and evaluation of schools), Somali Medical
professional Association (supervision and licensing of medical practitioners, especially in
Mogadishu), and other associations in the fishing, livestock, agriculture, pharmaceutical
and other industries have formed powerful association for the purposes of self regulation.
Some have impressive by-laws that can become the basis of future legislations. They have
different capacities and reach but their varied experiences can be invaluable asset to
future line ministries and public agencies in each sector.

As part of the restoring of governance systems in societies emerging from total collapse
of governmental institutions, the re-building of legal and regulatory frameworks is
certainly one of the hardest tasks of all; the case of Somalia, which has experienced the
outright dissolution of the State, is probably unique in the recent case-history of failed

The Conflict in Somalia: Drivers and Dynamics report advised the application of a CDD
approach referred to as Community Driven Reconstruction be applied in this post-conflict
situation (World Bank 2004).       This would build on community strengths and thus
support the sensitive economic development the report recommends. The report points
out that many communities possess the skills needed to identify needs, prioritize
interventions, manage resources, and monitor implementation.

Peter Little writes about informal service provision and the role of communities in his
recent study of the livestock trade along the Kenyan border (Little 2003). He
demonstrates how telecommunications and banking services have been provided I South
Central without any state to intervene. Some of the traders he interviewed reported that
in some respects business works better now than under the previous predatory regime.

8, Summary of Findings

1. The basic processes and structures of a public service are in place in Somaliland
and Puntland. The processes include policy formulation and decision-making, and
financial and human resources management. Some are almost model processes.
Examples include Puntland's accounting -- accounts are current, and Somaliland's Civil
Service Commission --- not only does it manage hiring in a systematic and transparent
manner, but it has implemented a restructuring and rightsizing program.

2. Quality not quantity is the capacity constraint. Staff, particularly those in key
technical and managerial positions, are not well qualified for their jobs. Few have been
trained in recent years, although training capacity is being put in place in both states. The
numbers of staff outstrip the fiscal capacity to support those staff at both central and local
government levels. We were told by ministers and mayors that Puntland's civil service
and the municipalities of Hergeisa, Berbera and Bosaso have twice as many staff as they
can afford. Somaliland did manage to retrench over 1,500 staff, but the numbers have
started to creep up again. The reason given for not reducing staffing is that
unemployment is high.

3. Ministries and local governments do not have the budgets necessary to fulfill
their legal responsibilities. Security absorbs almost the entire recurrent budget, leaving
less than ten per cent for social services in most cases. There is almost no development
budget in either state. Puntland is even in seven months' arrears in the payment of
salaries to civil servants. Planning ministries and other responsible for planning such as
the governors can only plan in the expectation of donor funds. This makes the case for
cutting staffing even stronger.

4. Staff are very poorly paid. A director general in Puntland is paid about the same as a
carpenter in the private sector. It is very difficult to attract well qualified professionals or
to motivate any staff. The absence of adequate pay incentives strengthens still further to
case for cutting staffing.

5. The consequence of the capacity, budgetary and incentive problems is that many
public services are mainly provided by the private sector and NGOs. This applies to
water, electricity, education and health. In most case there is some public provision. For
example, there is a public water supply company for Hergeisa and the Municipality of
Berbera "subsidizes" (the mayor's words) some schools and electricity for police stations.
We were told that top professional staff prefer to set up an NGO to supply services with,
hopefully, donor support, to joining the public service.

6. A positive consequence of these problems is that there are many examples of the
effective private provision of public services. A hotel in Hergeisa is doing a deal with
the public water supply company, which owns the wells and pumping capacity, to pipe
water to residents in the neighborhood of the hotel. The same hotel is currently supplying
electricity to the airport from its own generator. There are also good examples of public-
private partnerships. The Mayor of Hergeisa pays five NGOs each $5,000 a month to
collect garbage, and has provided some of the vehicles needed.

7. The pragmatic approach to service provision when resources are limited extends
to other functions of government. Unpaid outside experts are brought to assist in
planning -- the TFG has access to many such consultants, hoping for some payment
sometime in the future. When the private sector refused to pay the higher trade taxes,
raised to cover the costs of the drought, the Chamber of Commerce suggested a voluntary
scheme where firms paid between $1,000 to $25,000 to the Government of Puntland.

8. The TFG is has for some time been focusing on security and reconciliation rather
than setting up a public service. [It is almost impossible to write anything about TFG
that is not highly politically sensitive and therefore best left out of a background report.
But here is what I think I found out from taking to many members of the TFG]. Most
TFG members we contacted believe that at least security, if not complete reconciliation,
is a necessary condition to be achieved before the TFG begins to put in place a civil
service. There is much debate about the relative importance or sequencing of security
and reconciliation, and indeed the need for security in the form of an IGAD force, such as
has been requested by the President (without consulting his cabinet or legislature,
apparently). Some TFG members are critical of the TFG's, and the international
community's, focus on reconciling the warlords (hence putting so many in the cabinet),
when, they think, the focus should be on reconciling communities. What is needed, these
members believe, is stronger action on the part of TFG leaders in promoting and support
community reconciliation rather than bringing in AU or IGAD troops to keep the peace.
That in turn requires a strong center of government in the TFG -- political leaders
supported by top professional staff.

9. Some TFG members with experience of government feel that steps should be
taken to set up the very basic processes of a federal government. These include
setting up an effective office of the president and cabinet to manage the process by which
policies are formulated and decided upon (processes are very informal now) and provide
technical advice to the leaders; putting in place a civil service commission to handle the
staffing of the civil service; establishing the very basic public expenditure management
system covering budgeting, executing the budget and accounting for uses of funds; and
putting in place an effective and transparent procurement systems. This is much as is
envisaged in the Somalia Emergency Budget Support Project. [My own view of this
project, based upon experience of managing many public sector reform projects, is that
it is far too ambitious for a 6 month period. We aiming for far less in the short term in
South Sudan and Sudan's new Government of National Unity: simply staffing the very
center of government, the office of the president, plus setting up a civil service

10. The TFG is taking some immediate steps to achieve reconciliation and security
and begin to put in place a core civil service…Abdusalem to draft

Harry Garnett and Abdusalem Omer, 2.23.05

Annex 2: Somaliland: Staff figures by ministry/ agency [may drop this table,
which is from the desk study, since others available]
                                           Aud Acc Dep'
          Ministry/Agency            Chair Gen Gen  ty  Cmr DG DD A       B       C   D Total 1)

Ministry of Education                   0   0    0   0    0   1   5 438   935 23 304 1706 2)

Ministry of Health & Labour             0   0    0   0    0   1   5 87    305 305 155      858

Ministry of Finance                     0   0    1   1    0   1   5 40    191 75 99        413

Min'y Civil Aviation & Air Transp.      0   0    0   0    0   1   3 15     41 34 37        131

Ministry of Interior                    0   0    0   0    0   1   4 27     22 27 25        106

Ministry of Livestock                   0   0    0   0    0   1   3 22     40 27 11        104
Min'y Public Works, Housing &
Transp.                                 0   0    0   0    0   1   4   9    47 26 13        100

Ministry of Information                 0   0    0   0    0   1   3 12     61 16       6    99

Ministry of Commerce & Industry         0   0    0   0    0   1   3 15     36 27 16         98 3)

Ministry of Agriculture                 0   0    0   0    0   1   3 26     31 11 17         89

Min'y Rural Devel. & Environment        0   0    0   0    0   1   3   3    16 52 12         87

Min'y Water & Mineral Resource          0   0    0   0    0   1   3   9    30 17       9    69

Ministry of Culture & Tourism           0   0    0   0    0   1   3 12     28 15       4    63

Ministry of RR&R                        0   0    0   0    0   1   3 12     11 17 18         62

Min'y Fisheries & Coastal Devel.        0   0    0   0    0   1   3   6    17 19       9    55

Ministry of Sports & Youth              0   0    0   0    0   1   2   1    30     9 10      53

Min'y Posts & Telecommunication         0   0    0   0    0   1   3   5    21     9    5    44

Auditor General's Office                0   1    0   1    0   1   2   8    18     7    4    42

Min'y Religion & Endowment              0   0    0   0    0   1   3   2    14 12       4    36

Attorney General's Office               0   0    0   0    0   0   2   9       7   7    9    34

Ministry of Presidency                  0   0    0   0    0   1   3   3    19     7    0    33

National Demobilisation Committee       0   0    0   0    0   1   3   7       9   7    6    33

Min'y National Planning & Coord.        0   0    0   0    0   1   3 10        7   5    6    32

Civil Service Commission                1   0    0   0    4   1   2   3       8   4    6    29

Ministry of Justice                     0   0    0   0    0   1   3   5       7   5    6    27

House of Elders                         0   0    0   0    0   1   0   5       5 12     4    27

Ministry of Foreign Affairs             0   0    0   0    0   1   3   6       3   6    5    24

House of Representatives                0   0    0   0    0   1   0   4       4 10     5    24

Ministry of Defence                     0   0    0   0    0   1   3   1       5   4    8    22

Min'y Family Affairs                    0   0    0   0    0   1   3   4       4   4    4    20 4)

Supreme Court                           0   0    0   0    0   0   1   7       3   3    3    17

                                                 Aud         Acc Dep'
          Ministry/Agency                  Chair Gen         Gen  ty  Cmr DG DD A                   B       C   D Total

National Demining Agency                         0       0       0       0      0    1    2     7       0   3    3    16

National Tender Board                            0       0       0       0      6    1    0     0       4   2    1    14
Ctre Disaster Preparedness &
Prevention                                       0       0       0       0      0         1     2       2   2    2        9

Ministry of Houses Coordination                  0       0       0       0      0    0    0     2       2   3    0        7

National Bank of Somaliland                      0       0       0       0      0    0    0     0       0   0    0        0 5)

Regional & District Courts                       0       0       0       0      0    0    0 53        60    0 78     191

                                 TOTAL           1       1       1       2     10 31 92 877 2043 812 904 4774

Aud Gen = Auditor General; Acc Gen = Accountant General; Dep’ty = Deputy; Cmr = Commissioner; DG = Director
General; DD = department director; A – D = job grade (A being most senior)
1). All figures are based on 2002 statistics, with the following exceptions:
2). An additional 100 new Education staff recruited for academic year 02/03 are included
3). Since 2002 Ministries of Commerce and Industry have been amalgamated
4). Ministry of Family Affairs has been created since 2002
5). Staff figures for National Bank of Somaliland were unavailable at the time this report was finalised.


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