-Economic Value of Judicial Infrastructure- Court Reform and Court budgeting
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1 -Economic Value of Judicial Infrastructure- Court Reform and Court budgeting 3 April 2012 Seminar on Court Reform Portugal
2 Curriculum vitae Mr Joop Pot Education: Economics degree University, Groningen Present position: Member of the Netherlands Council for the Judiciary responsible for finance Former positions: Deputy Director-General Dutch Government Building Agency Director Financial and Economic Affairs, Ministry of Finance
3 Topics 1. Interaction between Economy growth and the Adminsitration of Justice 2. Rationalisation of Courts: a European perpective and Dutch situation 3. Performance based budgeting in the Netherlands
4 1.1 The impact of the legal infrastructure on the economy (and vice versa) An independent and efficient judiciary is of great economic value as it provides for a sound investment climate, necessary for the recovery of an economy. (ENCJ Vilnius Declaration) Research in the Netherlands has shown that 0.8% of growth can be attributed to well functioning legal infrastructure.
5 1.2 Core values of a Judicial Infrastructure The following core values need to be guaranteed: 1. Access to justice: right to see a judge, financial, fysical and timely access 2. Impartiality, independence 3. High standard of professionalism
6 1.3 Consequences current economic crisis 1. More cases More law suits in nearly all EU Member States Increase in civil cases and in particular: labour, bankruptcy, debt recovery 2. Public finance Public deficit and debt are out of equilibrium Expenditure cuts are foreseen in most EU Member States
7 1.4 Options to reduce expenditure Cut price of production factors salaries Reduce volume of cases (increase court fees/introduce threshold) Reduce costs per case (simplified procedures/delegation of tasks/adr) Reduce overhead Reorganise number of courts
8 2.1 Rationalisation of Courts in Europe Most European countries are geographically concentrating judiciary functions, thereby reducing the number of courts Reasons to reorganises vary
9 2.2. Rationalisation of courts reasons: To enhance the quality of Justice: Denmark, Norway and The Netherlands Cost reduction (and enhance quality) Greece, Austria, Ireland, UK, Poland, Romania Other reasons: specialisation/ minimum necessary number of judges/ introduction of new technologies and timeliness.
10 2.3 Rationalisation of courts Criteria used to establish the number of courts Population distribution Geographic distance ad accessibility of support services/infrastructure Sufficent number of cases to allow efficient use of courts Adequate number of judges and support staff to guarantee continuity and to allow for specialisation
11 2.4 Reorganisation of the Judicial Map in the Netherlands History, external Reform of the judicial map since 2007 (after evaluation of the 2002 reorganisation) on the political agenda The House of Representatives (Parliament) requested a total reform of the judicial map Minister of Justice startes legislative process for the redrawing of the judicial map At the same time the Public Prosecution Offices and Police regions will be reorganized as well. There will be 10 Public Prosecutions Offices and 10 Police regions.
12 2.5 Reorganisation of the Judicial Map in the Netherlands Why do we reform the judicial map? To guarantee the quality of justice and to be able to fulfil the (justified) future demands and needs of society The quality of justice contributes to the quality of justice on three levels 1. Each new court will have sufficient cases in relevant areas of the law to allow for specilaisation and continuity 2. Quality of the governance of the judicial system 3. Quality of the organisation and operational management
13 2.6. Current Judicial Map 19 Courts of first instance, 53 locations Leeuwarden Groningen 5 Courts of Appeal Supreme Court Alkmaar Amsterdam Haarlem Utrecht Zwolle Assen Almelo Dordrecht Rotterdam s-gravenhage Arnhem Zutphen Den Bosch Middelburg Roermond Breda Maastricht
14 2.7 The proposed judicial map courts of first instance from 19 to 10 districts from 53 to 32 locations from 19 to 10 boards (from 95 to 30 boardmembers) the Board of the Court decides which cases will be handled at which location
15 2.8 The proposed judicial map Courts of Appeal From 5 to 4 districts From 5 to 4 boards
16 3.1 Performance based budgeting Background information the Netherlands million inhabitants fte judges fte staff (for primary process) and 1500 fte staff overhead 4. Caseload approx. 1.8 million (2011) 5. Budget for the judiciary in 2011: 975 million
17 3.2 Performance based budgeting Background information Court Management Structure (current situation) Board of the Court: President, Director of operations, Sector Heads Integral management: The line manager at every level is responsible for the running of the part of the organisation under his leadership and is given the necessary responsibilities and powers to carry out this task in practice within the boundaries of the law and the policy of the Council.
18 3.3 Court Budgeting Responsibilities of Board of the Court Personnel Financial matters Organisation Quality Housing* Security* Information technology* * tight centralised framework set by the Council
19 3.4 Budgeting (1) Budget in 2011: 975 million Allocation of financial resources to the judicial system is decreed by law on an annual basis. The Council for the Judiciary is accountable to the Minister of Justice for the way in which these resources are spent. The Council distributes the resources among the courts. Each court decides on the way in which the resources are spent.
20 3.5 Budgeting (2) Relation Minister-Council /Council-Courts Minister of Justice is responsible for the system Minister of Finance agrees on the system. And the budget! The relationship between the Court Board and the Council is embedded in a planning and reporting cycle
21 3.6 Budgeting (3) P x Q based P= price per judicial decision Price agreement every 3 years for various categories of cases Based on average diposal time x tariff per minute (for each staff category) Determined through time measuring surveys Q=quantity Set annually Based on inflow prognosis
22 3.7 Budgeting (4) Relation Minister Council Budget proposal Council to the Minister Minister and Council agree: Budget is granted Minister and Council disagree: Minister has to explain to Parliament Parliament decides; Price-agreement Minister and Council every three years Quantity-agreement Minister and Council every year Differences between agreed and actual volume are netted at the end of the year Equalization account: for differences between the agreements and the real outcome (in quantity)
23 3.8 Budgeting (5) Budgeting system: Council - Courts Performance budgeting: more production, more money Same product groups as Minister - Council Planning and reporting cycle
24 3.9 Budgeting (6) Performance and incentives Efficiency Closing a loophole: netting at 100% of the price (instead of 70%) Benchmarking (performance indicators) (financial result/ owner s equity / quality indicators)
25 3.10 Performance indicators (1) Why Transparency in functioning of the courts Instrument of feedback and therefore for improving How Indicators per court Comparable measurements: registration standards Separate analysis for each court Overall analysis
26 3.11 Performance indicators (2) Topics: Quality of the judiciary Production and finance
27 3.12 Performance indicators (3) Quality (excl. legal quality) PE 30 (30 hrs education permanente per year) Customer assessment/satisfaction scores (10 topics) Compared to standards Length of procedures - Compared to average all courts and to last year and standards
28 3.13 Performance indicators (4) Production and finance Number of cases handled (per product group) Compared to production agreements and new cases brought to court Costs per case and distribution of products Compared to production agreement Productivity - rate (rate) per hour and cases handled per employee Compared to agreements and average all courts
29 3.14 Lessons learned (1) Pro s and con s of the system Pro s: Objective and independent Emphasis on production Efficiency incentive Transparency Just allocation Benchmark Con s: At the expense of the quality Time measuring is laborintensive System is relatively complex The whole judicial chain (police, presecutors office, judiciary) should be financed in the same way
30 3.15 Lessons learned (2) Is the system exportable? Conditions: Reliable and uniform registration of cases and case data You have to make the right choice of case differentiation and level of detail Periodic time-measuring and rethinking the workload norms You must have a quality measuring system
31 Questions?
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