Policy responses to the Eurozone crisis: A comparative analysis of southern European administrations

Abstract

The Eurozone crisis has worked as a forceful external factor for activating a series of fiscal and structural adjustments in the countries of the EU periphery. Public administration was a key reform area and has undergone notable transformations under the fiscal consolidation programmes. This paper aims at identifying the impact of the crisis on public administration with a focus on southern Europe. It reviews and compares the goals and the outcomes of the administrative reform programmes that were implemented in Greece, Italy, Portugal and Spain during the crisis. This cluster forms a distinct administrative paradigm emanating from the Napoleonic state tradition. The relationship between administrative tradition and administrative change or persistence is explored in a historical institutionalist perspective. The findings identify similarities, divergences and variations across and within the Southern countries, also suggesting that while certain changes occurred, the Napoleonic features of the southern administrations remained largely untouched by the reform programmes.

Keywords

Eurozone crisis Napoleonic tradition policy reform public administration southern Europe

Introduction

The southern periphery of the European Union is characterized by a set of similar social-political, economic and cultural features that shape a distinct state paradigm (Di Mascio and Natalini, 2015; Kickert, 2011; Ongaro, 2009; Sotiropoulos, 2004). Along with the strong interventionist elements, the South European countries correspond to a particular type of state organization, which was largely inspired by the Napoleonic administrative tradition. Beyond the advantages and limitations of this model, the southern bureaucracies have been often (over-)criticized in terms of their size, effectiveness and efficiency, especially compared with their central and northern counterparts. This topic has gained renewed attention after the outbreak of the Eurozone crisis in 2009.

This paper aims at contributing to the current debate on the impact of the Eurozone crisis on the southern European bureaucracies, namely Greece, Italy, Portugal and Spain. Research on southern Europe is not yet a developed concrete field (Pollitt, 2009), particularly regarding the comparative study of public administration. While recent studies have explored the crisis’ effect on the socio-political and administrative systems, the emphasis is usually placed on the politics of austerity and fiscal consolidation (Hood et al., 2014; Kickert and Randma-Liiv, 2015; Kickert et al., 2015; Lodge and Hood, 2012) or on covering country experiences. Existing literature has discussed the particularities of the Southern bureaucracies (Kickert, 2011; Sotiropoulos, 2004) and has addressed some key questions regarding the reform of the Napoleonic model (Bezes and Parrado, 2013; Ongaro, 2009, 2012; Peters, 2008). Some scholars have explored the reaction of public administration, public management and public service to the financial and sovereign crisis (Kickert et al., 2015; Lodge and Hood, 2012; Pollitt, 2010; Randma-Liiv and Kickert, 2017). Recent research has also focused on the impact of the austerity programmes on the southern administrations (Di Mascio and Natalini, 2014, 2015; Sotiropoulos, 2015). However, less attention has been devoted to the role of administrative tradition in explaining the outcomes and evolution of reform patterns within the context of the Eurozone crisis.

With the purpose of addressing this gap, this paper seeks to answer two central, inter-related questions: First, what was the impact of the crisis on the process of administrative reform in the southern European countries? Second, could the respective adjustments indicate a broader paradigm shift within this cluster of countries that share a common administrative tradition?

The first question focuses on the policy mix that has been adopted in response to the crisis and tries to empirically measure its impact on public administration. A first theoretical proposition suggests that the crisis has changed the domestic reform agendas and provided a new rationale for going beyond (or bypassing) the standard patterns of administrative change and shifting towards new paradigms, different from the Napoleonic one.

TP1: The Eurozone crisis has changed the policy agenda for administrative reform.

Agenda change is specified with reference to the policy goals and measures of the reform programmes, which form the basis of the empirical analysis. The second question correlates these findings with the Napoleonic administrative tradition using the historical institutionalism theoretical framework. This part of the analysis mainly draws on the literature covering the effect of the reform programmes on public administration. Since past reforms seem to have instigated only limited transformations of the southern bureaucracies (Gualmini, 2008; Kickert, 2011; Ongaro, 2009), a key question is whether the policies of the crisis period achieved what previous efforts failed to deliver, that is to say a new and stronger condition for administrative change. The Napoleonic model serves as an intervening variable, explaining the outcomes of the reform programmes and the patterns of change across and within the southern periphery. This causal relationship between reform capacity and administrative tradition leads to an additional theoretical proposition:

TP2: The effect of the crisis on public administration has been mediated (and limited) by the Napoleonic tradition.

Taking this argument a step further, a third theoretical proposition that relates to both research questions posits that not only existing administrative patterns have not been deranged during the crisis years, but also, in certain respects, the occurred adjustments have reinforced them, shifting the process of change towards old patterns.

TP3: Since the crisis erupted, southern bureaucracies tend to have moved backwards, towards their Napoleonic roots, rather than new paradigms.

These propositions form one core argument, suggesting that while the Eurozone crisis seemingly changed the policy agenda for administrative reform, policy outcomes reflect notable stability and resilience of the administrative systems, which can be largely explained by the influence of Napoleonic tradition. Thus, this paper offers insides into the crisis’ effect on public administration through the lens of administrative tradition. The exogenous stimulus (Eurozone crisis) is linked with the endogenous variables (Napoleonic tradition), providing explanations of institutional change and persistence. The analysis of the relationship between the crisis’ effect and the Napoleonic tradition is the theoretical contribution of the paper. Empirically, it assesses the quantitative and qualitative impact of the adjustment programmes on the southern administrations.

The analysis focuses on the period 2009–2016, covering administrative reforms undertaken in the course of the fiscal adjustment programmes. The basis of the comparison is justified by the common institutional background on which the selected group has been consolidated as a distinctive “southern” model (Heinemann and Grigoriadis, 2013; Kickert, 2011; Magone, 2003; Ongaro, 2009; Painter and Peters, 2010; Pollitt, 2009; Sotiropoulos, 2004). While the Southern countries have not been affected equally by the crisis, this criterion is more relative to the focus of the study; therefore, the case studies do not include Ireland and Cyprus, which belong to different administrative families.

The paper adopts a new institutionalism perspective (Hall and Taylor, 1996; March and Olsen, 2006). The Napoleonic model is the basis for the cross-national study of the administrative systems. The central independent variable is the Eurozone crisis. The analytical model (Figure 1) unfolds in two levels, covering policy goals and programmes’ outcomes. Three horizontal micro-level dependent variables that correspond to key-dimensions of the administrative apparatus are discerned: (i) structures, (ii) functions and (iii) human resources. This distinction provides a categorization of the main features of administrative systems and helps to better illustrate and explain the effect of the reforms in a comparative view. Structures refer to the size of public administration and to the way in which its units, levels and services are organized. Functions include the administrative processes, procedures and operations. Human resources refer to the status, management and conditions of employment of the civil service personnel.

Figure 1.

Research design and key variables.

The empirical investigation is evidence-based, supported by official documents, namely the Memoranda of Understanding (MoU), the national reform programmes, domestic legislation, reports and reviews. Financial and quantitative data have been collected from the Eurostat and OECD databases. A set of qualitative indicators that cover selected administrative variables that are of greater relevance to the purpose of this study were drawn from the World Bank and Bertelsmann Stiftung.

The Theoretical framework and the Napoleonic legacy section introduces the theoretical background and describes its linkage with the Napoleonic tradition and the context of the paper. Responses to the crisis section provides an overview of the measures that have been included in the administrative reform programmes and an empirical assessment of their impact. Comparative findings and explanatory factors are discussed in Horizontal analysis and discussion section, also addressing the effect of the crisis on the Napoleonic features. The main results and some final remarks are summarized in the concluding section.

Theoretical framework and the Napoleonic legacy

Administrative tradition patterns can be perceived as ‘a means of understanding and interpreting public administration’ (Peters, 2008: 118). These inherited elements are considered as mediating factors in the process of administrative reform (Hammerschmid et al., 2007; Painter and Peters, 2010; Pollitt and Bouckaert, 2011). In this paper, they are utilized as tools for understanding the southern bureaucracies’ responsiveness to change, in reaction to the Eurozone crisis. However, as any conceptual model, their explanatory power has certain limitations and depends on the particular case under study. Notwithstanding other variables that affect administrative change, in the analysis that follows the features of the Napoleonic tradition help to define the ‘institutional design’ (Peters, 1999: 72) of the southern bureaucracies and to understand the historical and institutional context within which policy responses to the crisis have evolved and affected the administrative apparatus.

From a historical institutionalism perspective, the formal and informal structures, rules, procedures, norms, preferences and relations provide an analytical framework for the study of the political phenomena (Hall and Taylor, 1996; March and Olsen, 2006; Thelen and Steinmo, 1992). The institutional environment influences the policy process and its outcomes, explaining the direction and the degree of change or continuity over time. Historical institutionalism focuses on the interconnection between earlier policy and institutional choices and persistence patterns of structures and organizations that have a long-lasting effect on future developments (Capoccia, 2015; Peters, 1999). In this theoretical strand, exogenous change, such as the European sovereign debt crisis, is often a driver for gradually adapting new patterns within existing institutions, as suggested by the ‘punctuated equilibrium’ (Baumgartner and Jones, 1993; Krasner, 1984) and ‘institutional dynamism’ models (Thelen and Steinmo, 1992).

Exogenous shocks can generate pressure and trigger policy shifts that influence the process of change and may lead to a new equilibrium (Peters, 1999: 69–70). The ‘critical juncture approach’ provides a conceptual framework for explaining the effect of exogenous events on the evolution of dominant institutional patterns towards new (enduring) paths (Capoccia, 2015). The occurrence of the Eurozone crisis apparently signified a ‘critical juncture’ (Verdun, 2015) that potentially threatened to destabilize the dominant patterns of the southern bureaucracies. However, the type and degree of administrative change vary and largely depend on existing institutional settings (Kickert and van der Meer, 2011).

To address the question of institutional change, a distinction between incremental and radical transformations is deemed necessary (Mahoney and Thelen, 2010). This paper adopts analytical tools from the incremental change strand of historical institutionalism. Path dependence explains how earlier steps and given patterns affect the evolution and reproduction of institutions towards the same direction (Mahoney, 2000; Pierson, 2000). This direction is defined by the administrative heritage of the southern European countries. The persistence of enduring patterns leads administrative systems to exhibit relative stability and to remain resilient in times of crisis. The administrative legacy provides an explanatory basis for addressing the role of these patterns in the process of reforming southern bureaucracies under the crisis pressure. Napoleonic tradition is embedded in the path-dependency framework with reference to the ‘self-reinforcing sequences’ and ‘functionalist’ explanatory factors (Mahoney, 2000).

The equilibrium between change and continuity (Streeck and Thelen, 2005) is analysed with reference to policy agenda and policy outcomes. It is suggested that, while reform programmes to a certain degree interrupted stability at the agenda-setting level, it is not equally clear that policy outcomes have significantly challenged the endogenous dynamics of the administrative systems.

While southern countries are categorized as a distinct case among administrative traditions (Painter and Peters, 2010), the Napoleonic tradition does not constitute a coherent state pattern (Kickert, 2011: 812–813; Ongaro, 2009: 12–13). However, it can provide a basis for comparison, as an ideal-type model for simplifying the different ways and degrees that the southern administrations have embedded (some of) its normative features.¹ In its typical form, Napoleonic legacy suggests an ‘organic conception’ of the state, characterized by a centralized and hierarchical type of organization, formality, uniformity, procedure-focused, legalistic culture, a distinct administrative law, political accountability of the bureaucracy and a civil service career-based system (Kickert, 2011; Ongaro 2009; Peters, 2008). The Napoleonic features of the southern administrations are summarized in Table 1, in line with the analytical distinction of this paper.

Table 1.

Typical Napoleonic features of the Southern bureaucracies

Organization/structures	Functions/procedures	Human resources
Unitarian state Centralization Hierarchy Organic conception of the state	Administrative law Procedures-focused Legal formalism Uniformity Control/accountability	Professional corps Civil service career-based system

Responses to the crisis

The Eurozone crisis was the fourth phase of the global crisis, following the banking (2008), economic (2009) and fiscal one (Kickert and Ysa, 2014; Kickert et al., 2013). The symptoms, degree and sequencing of the economic, financial and fiscal aspects of the crisis vary across countries, consequently affecting policy responses, tools and outcomes. A main consequence of the crisis has been that policy-making became more complex. The Eurozone crisis led to the creation of new institutions and procedures² and affected the strategies and the balance of actors in decision making (Papadakis and Ghellab, 2014; Verdun, 2015; Warren et al., 2017). A new, critical variable in policy decisions was the conditionality linking the programmes’ implementation with the loans disbursement (Spanou, 2016). In addition, new powerful (supranational) actors emerged, such as the ‘Troika’.³

The reforms were linked with specific policy tools under the financial assistance programmes, such as the Memoranda of Understanding (MoU). In Greece and Portugal, administrative reforms were an integral component of the MoU, including detailed requirements (Kickert et al., 2013: 48; Sapir et al., 2014). The Italian and Spanish governments maintained relative autonomy in formulating the domestic policies. Administrative reforms in Spain were not part of the MoU (which was financial-sector specific) but were embedded in the structural adjustments required by the stability programmes (OECD, 2016a: 22–23). Italy didn’t enter into a MoU but was pressured to adopt measures in order to fix its macroeconomic imbalances, which affected the administrative system.

The policy mix

Administrative reform programmes aimed at delivering a range of goals. In the Greek Memoranda, the need for rationalizing, downsizing and enhancing the efficiency of public administration was stressed. Likewise, Portugal prioritized efficiency and cost-effectiveness actions, along with the goal of rationalizing its administrative apparatus. In Spain and Italy, the adjustment programmes focused on fiscal targets, while administrative reforms were linked primarily with tax and revenue procedures and indirectly with structural measures through the stability programmes.

Table 2 provides a list of the measures for public administration that have been included in the reform and adjustment programmes. Given the purpose of this paper and that the structure and content of the programmes vary among countries, they are divided into three categories covering: organizational structures, procedures and human resources. This categorization presents the administrative reform policy mix in a uniform way that enables comparative assessment and can be linked with the Napoleonic features, as classified in Table 1. The data is based on official documents, namely the Memorandums of Understanding⁴ (MoUs), the National Reform⁵ and Stability⁶ Programmes (European Semester), the domestic reform programmes⁷ and country reports.⁸ Additional information was obtained from the OECD Reviews⁹ (2011–2016) and the Bertelsmann Stiftung SGI Reports (2009–2015).

Table 2.

The policy mix: Goals and main measures

	Greece	Italy	Portugal	Spain
Main Goals	Rationalization Efficiency Downsizing Depoliticization	Modernization Efficiency Simplification	Efficiency Cost-effectiveness Rationalization	Modernization Rationalization Efficiency Downsizing
Measures
Structures
Downsizing public entities	•		•	•
Reorganization of central administration/ Reduction in the number of units	•		•	•
Closing/Merging public entities	•		•	•
Restructuring/Streamlining local government	•	•	•
Merger of municipalities and regions/prefectures/parishes	•
Special structures/bodies for administrative reforms	•		•	•
Functions
Reforming/strengthening public financial management system	•		•	•
Revenue administration reform	•		•
Centralization of expenditure monitoring of all government levels	•	•	•	•
Cuts in operational cost/public spending	•	•	•	•
Procedures simplification		•	•	•
ITC/E-government tools	•	•	•	•
Better/improved regulation	•	•	•	•
Human Resources
Personnel cuts	•		•
Recruitment freeze/reduction, application of fixed replacement rate	•	•	•	•
Reduction of fix-term/temporary positions	•	•	•	•
Salaries’ reductions	•
Wage freeze	•	•	•	•
Abolition/Freezing of special bonuses/allowances	•		•	•
Lay-offs, pre-retirement and ‘labour reserve’ schemes	•		•
Internal/external mobility	•	•	•	•

•

: measures included in the reform programmes.

◦

: measures planned/partly initiated by the reform programmes.

Table 2 shows that after the crisis the administrative reform agenda focused on modernization, rationalization and downsizing. The reaction of the national governments followed a typical path of reducing expenditure via horizontal cuts in capital spending and operational cost. Emphasis was placed on retrenchment measures, public financial management and revenue administration.

Structural reorganization occurred at all levels of government, mostly aiming at reducing units. In all four countries, public entities at the central and/or local level were restructured, merged and/or abolished. In addition, a tendency for (re-)centralizing powers was observed, through the reinforcement of the PMs’ Offices, budget planning and coordination units and the upgrading of the Finance Ministries.¹⁰ A similar trend was the establishment of special structures/bodies for the planning, coordination and monitoring of administrative reforms¹¹ (except for Italy). Centralization was also traced in the (re-)organization of the administrative systems (Di Mascio and Natalini, 2016), the decision-making process (Kickert et al., 2013) and the autonomy of local government (Nunes Silva, 2017).

Regarding administrative processes, as most countries faced with the economic crisis (OECD, 2013), new budgetary tools and stricter rules and procedures were adopted in budget-financial management. Centralization of expenditure monitoring of all government levels has occurred, and control mechanisms were often accompanied by the establishment of independent authorities for monitoring public finances. In addition, some ICT techniques and methods for procedures’ simplification were introduced.

Changes in human resource management affected the status of civil servants. Measures introduced horizontal pay cuts, wage reductions, lay-offs, recruitment freeze and partial replacement of the retiring employees. In all countries wage freezes were applied, fix-term/temporally positions were reduced, and special mobility schemes were initiated. In Greece and Portugal, career and remuneration systems have undergone notable changes, partly introducing some private sector techniques. Furthermore, measures imposed personnel cuts, lay-offs, pre-retirement and ‘labour reserve’ schemes.

The impact of the reform programmes

The nature and the intensity of the described measures as well as their impact vary across countries. The direct and most evident effect of the crisis on public administration was a clear improvement of the financial indicators. With reference to the available Eurostat data,¹² the direction of the fiscal shifts has been symmetric in all four cases, but variations were observed in the scale of the experienced adjustments. Public sector financial indicators show that, since the outbreak of the crisis, spending and borrowing have been restrained, revenue has increased and wage bill has been reduced. Greece achieved the highest fiscal adjustment in all areas (also considering the simultaneous largest fall of its GDP), while Italy the lowest.

Notable decrease in public employment was recorded in most countries. Based on OECD data,¹³ during the period 2010–2015¹⁴ employment in general government fell by 15% in Greece, 7% in Portugal, 6% in Italy and 2% in Spain. Downsizing and restructuring occurred across all levels of administration. In Greece, the units of central administration have been decreased on average 31%¹⁵ (Hellenic Ministry of Administrative Reconstruction, 2017: 13), around 200 public entities have been merged, a few institutions were abolished¹⁶ and municipalities were merged and reduced by 69%. In Portugal, till 2012, management positions had been reduced by 27%, administrative units by 38–40% (EC, 2014: 42; Gaspar, 2011) and the total number of parishes by 29% (EC, 2014: 42). In Spain, 31.9% of the existing institutions of autonomous communities, 25% of the municipalities and 114 general administration entities had been eliminated by 2015 (OECD, 2016a: 21–27).

Turning to the qualitative variables of public administration, the impact of the crisis is not equally clear as its fiscal effect. Besides, the former cannot be precisely measured and isolated from other factors affecting the administrative systems. The quality of public administration is here assessed by drawing selectively on indicators from existing surveys that relate to the purpose of this paper, namely the WB Governance Indicators and the Bertelsmann Stiftung Sustainable Governance Indicators (SGI). Notwithstanding the limitations and the criticism to which these sources have been subjected,¹⁷ as well as other factors affecting the measurements of administrative performance, the selected datasets aim to give some indication on the evolution of key administrative variables, not an accurate evaluation, also taking into account the inherent uncertainty of these rankings and the lack of specific and comparable primary country-level data on administrative reforms.

The first set includes three WBG indicators: Government Effectiveness, Regulatory Quality and Rule of Law. These variables are more directly linked with the administrative systems as well as the goals of the adjustment/reform programmes, such as effectiveness and better regulation. As shown in Figure 2, a general downward tendency can be observed in most cases. Governance scores show that Regulatory Quality and Rule of Law have declined during the period 2010–2016, with the exception of Portugal. Government effectiveness has notably deteriorated in Greece, while in the other three countries has recorded relative improvement (both positive and negative shifts). Greece recorded the highest fall in all three areas and remains the lowest-ranked country.

Figure 2.

Governance Indicators 2009–2016. Source: Authors’ elaboration based on WB Governance Indicators.

The second set focuses on more specific indicators that can be linked with the Napoleonic features and are based on the Executive Capacity components¹⁸ of the quality of governance (Bertelsmann Stiftung SGI). Figure 3 shows that, in the period 2009–2016, the scores of Monitoring Ministries, Agencies and Bureaucracy have increased in most cases, which could imply that centralization and political control over the administrative system have been strengthened. At the same time, the Constitutional Discretion of the sub-national and local government has weakened, except for Italy. This relates to the already mentioned tendency of centralization and strengthening of the co-ordination mechanisms, which is also reflected in the increasing role of the strategic planning units (except for Portugal). As regards the regulatory variables, while the scores of evidence-based instruments were relatively improved, all four countries record low regulatory quality. This was also confirmed by the WB index and could imply a limited change in the legalistic-formalistic and procedures-oriented culture of the southern administrations.

Figure 3.

Sustainable Governance Indicators 2009–2016. Source: Authors’ elaboration based on Bertelsmann Stiftung SGI Reports.

Horizontal analysis and discussion

Comparative findings

Taking a closer look at the outcomes of the reform programmes, several similarities and divergences can be identified within the southern European cluster. As previous research suggests (Cotta et al., 2014, 2015; Di Mascio and Natalini, 2014, 2015; Featherstone, 2015; Kickert and Randma-Liiv, 2015; Pollitt, 2016; Spanou, 2015), in all four cases the policy responses to the crisis focused on the short-term fiscal targets, with the aim of generating direct savings. Less attention has been paid to a systematic restructuring plan of the administrative apparatus; thus, mostly incremental structural adjustments occurred. Empirical findings have provided mixed results regarding the impact of fiscal adjustment on the quality of governance. In all cases, the public sector has become less costly, but this does not necessarily mean that is now more efficient. Apart from some strengthening of the financial management tools and ICT and digital services (EC, 2016a, 2016b; OECD, 2016a, ch.3), no major positive shift in administrative performance can be traced. On the contrary, in many cases, the horizontal fiscal-oriented measures, such as the downsizing of public services and lay-offs, had a reverse effect on the quality of administration and the provided services (Alonso and Clifton, 2013: 30–31; Spanou, 2015; Zahariadis, 2016).

Differences in the depth, speed and timing of policy responses as well as variations across and within the implementation programmes were traced. All four countries initiated the measures under mounting fiscal pressure, but in Greece and Portugal they were characterized by greater intensity and external involvement. The structure and content of the programmes were relatively similar, but their duration and the scale of change differed. Greece recorded the larger degree of fiscal adjustment and at the same time the largest deterioration rate in the WBG index, which could imply a reverse relationship between the intensity of the fiscal measures and the quality of governance. Country-specific elements exist, such as the liquidity mechanisms for local administrations in Spain and the external technical assistance (Task Force) in Greece.

An important (and often overlooked) aspect of the reforms is that many of the measures adopted have been reversed after the adjustment programmes have expired. Along with the ‘reform fatigue’ (Darvas and Álvaro, 2015: 7–8), several measures were gradually loosened or overturned, such as the civil service reform in Greece (IMF, 2015), the salary cuts in Spain (OECD, 2016b: 396) and the working hours increase, wage cuts, requalification scheme and the reduction in the number of municipalities in Portugal (EC, 2014: 42, 2016a; IMF, 2016: 9). In addition, important actions have been stalled or pending, for instance the modernization and institutional reforms (Darvas and Álvaro, 2015: 28) and public servants lay-offs in Italy (Kickert et al., 2013: 24) and the implementation of the Budget Framework Law and local administration reform in Portugal (EC, 2014: 42, 2016a: 21–22).

A certain convergence in the content and the timing of the policy cycles across the southern countries was observed. Contrary to previous reactions to common external pressures, such as the EU membership (Magone, 2003; Pinto and Teixeira, 2002) and the EMU accession criteria (Blavoukos and Pagoulatos, 2012), during the Eurozone crisis governments were forced to adopt and implement the required measures almost simultaneously. Fewer deviations and discontinuities between established provisions and achieved results were observed. In this respect, the crisis to a certain extent enhanced the stability of policy agendas under successive governments.

Table 3 summarizes the main findings of the comparative analysis. Regarding similarities, in all countries the reform programmes placed emphasis on the rationalization of public expenditure. A certain degree of convergence was observed in the content and the synchronization of the administrative reform agendas. Similarities are more evident in the case of cost-saving and fiscal discipline measures, such as downsizing (structures and personnel), financial management systems and budget and procurement procedures. These reforms were accompanied by a tendency of (re)centralizing decision making, monitoring and control powers.

Table 3.

Administrative reforms during fiscal adjustment: Comparative findings

Similarities	Differences	Convergence	Divergence
Policy mix	Reform intensity	Reform agenda	Policy outcomes
Fiscal stress	Reform pace	Fiscal adjustment	Structural measures
Programmes structure	Programmes duration	Timing	Scale of change
Emphasis on public expenditure rationalization	Reform capacity	Centralization	Reform prospects
Emphasis on public expenditure rationalization	External involvement	Centralization	Reform prospects

Notable differences exist in the pace, intensity and duration of the initiated reforms. Greece’s adjustment has been longer and deeper compared to the other countries. The nature and the extent of required adjustments vary. Greece and Portugal initiated larger-scale downsizing and restructuring, personnel cutbacks and wage reductions. Further differentiations were traced with reference to the aspects of the reforms that were not directly aimed at producing savings, such as local government reform, organizational restructuring and the civil servants’ status. The prospects of the reforms also diverge, depending on the national administrative reform paths, beyond the restrictions and the conditionality of the financial assistance programmes.¹⁹

Explanatory factors

Literature suggests that the primarily fiscal focus of previous and recent reform efforts cannot easily conciliate with some core dimensions of the Napoleonic tradition (Ongaro, 2008; Parrado, 2008), such as the legalistic culture (Di Mascio and Natalini, 2016: 170; Kickert, 2011: 808), accountability issues (Peters, 2008) and the civil service system (Ongaro and Valotti, 2008: 199–200). From a historical institutionalist perspective, while the Eurozone crisis created strong external pressure for reform and could be considered as a potential critical juncture, the outcomes of the implemented policy mix did not break the path-dependent process of administrative change in southern Europe. The ‘causal mechanisms’ (Bezes and Parrado 2013; Yesilkagit, 2010; Meyer-Sahling, 2009; Kitschelt, 2003) linking tradition and reform can be traced in the questionable compatibility of certain crisis’ measures with the Napoleonic features of the southern bureaucracies. The impact of the reform programmes has been limited by these factors, while the type and degree of change (Kickert and van de Meer, 2011) correspond mainly to incremental adjustments, indicating a considerable degree of continuity between existing institutional patterns and reform outcomes.

However, policy outcomes have been affected by variables that go beyond the institutional environment of the administrative systems, also taking into account the cross-country variations. Explanatory factors relate to the economic conditions and financial vulnerability of each country (Lodge and Hood, 2012), as well as to the severity of recession and the required adjustments (Kickert et al., 2013: 40–43). Other explanations lie in the reaction of the political and representation system (Freire et al., 2014; Verney and Bosco, 2013), the interplay between the political-administrative sphere and interest groups (Afonso et al., 2015), communication and public support of the initiated policies, ‘resistance’ factors and ‘reform ability’ (Heinemann and Grigoriadis, 2013).

The discourse that legitimized (or not) the crisis agenda and the way by which problem definition was linked with policy reforms and the ownership of the programmes (Ladi, 2016; Spanou, 2016) could explain the weak results in cases where the latter were perceived by the national governments as a ‘necessary evil’. The Spanish and Portuguese reform programmes were characterized by stronger ownership than the Greek one (Mors, 2016). Actors’ strategies also affected policy outcomes. The willingness and the commitment of governments to implement and support the formally agreed programmes were not self-evident. Information asymmetries between national governments and the EU institutions, when pursuing different agendas, left a certain degree of discretion that could explain the delays and gaps in programmes’ implementation.

In addition, the different patterns of political competition and the varying degree of government alternation have a crucial role to play in explaining policy responses and outcomes. During 2010–2016, major differences appear among the four countries. The turnover of the parties or coalitions of parties that alternated in government was notably high in Greece (along with early elections) and partly in Portugal. Italy and Spain, while they underwent political turmoil, exhibit greater stability; however, their government characteristics differed (Kickert et al., 2013: 44–46). New government schemes also emerged, such as the technocratic governments in Greece and Italy.

The Napoleonic variables

The typical Napoleonic features of the southern administrative systems have not been substantially affected by the reform programmes of the crisis period. While notable changes occurred, no clear shift to a new pattern, alternative to the Napoleonic one, can be discerned. Measures such as downsizing and personnel cuts to a degree relate to the NPM strand,²⁰ a key feature of which is a small(er)-sized government. The goal of efficiency, which lied at the core of the reform rationale, is also linked with the NPM logic that focuses on efficiency, productivity and a results-oriented culture, unlike the legalistic and procedures-oriented culture of the Napoleonic tradition. Private sector inspired practices, such as productivity targets (Portugal) and part-time employment (Greece) may also imply an attempt for greater flexibility of the employment relations. However, the scope and the impact of these measures have been limited and mostly aimed at improving financial performance. Besides, their long-term effect remains weak, as many of them were abolished after the adjustment programmes have expired. Even in the case of Greece that has undergone the deepest adjustments, no ‘paradigm shift’ (Ladi, 2014) or ‘break’ with the prevailing administrative tradition can be claimed (Featherstone, 2015: 310).

The horizontal study of the southern administrations showed that certain core elements of the Napoleonic tradition, such as the centralization of powers and the political control of the bureaucracy, have been reinforced during the crisis years. On the contrary, measures that aimed at breaking dominant patterns, such as those targeting civil service, gradually loosened or even reversed. Thus, while the policy agenda for administrative reform has seemingly changed, at the implementation level no radical institutional shifts occurred. A partly paradoxical finding is that the southern bureaucracies to a degree tend to backtrack towards their roots than new modernization patterns. Hence, the process of administrative change, even in the presence of a strong exogenous stimulus such as the Eurozone crisis, seems to be highly path-dependent, suggesting an interpretation of the persistence of legacies based on past ‘institutional arrangements’ (Kitschelt, 2013).

Beyond the questionable compatibility of the measures with existing administrative patterns, the lack of a coherent reform paradigm that would go beyond the rules of financial management provides a more specific explanatory basis for the Napoleonic model resilience. While reform programmes envisaged certain radical reforms, they have prioritized fiscal consolidation in a short-term perspective (Ladi, 2014); nevertheless, this key goal has not been embedded in a systemic plan for reforming public administration. This also explains the fact that the crisis often had a reverse effect and worked as a hindering factor to the implementation of ongoing programmes, for instance the personnel and performance reforms in Italy (Di Mascio et al., 2017; Kickert et al., 2013: 51) and agencification in Spain (Bezes and Parrado, 2013: 43).

In addition, the reform prerequisites were basically similar among all countries that were hit by the crisis. Thus, the reaction of the southern administrations may have been a defensive or conservative reflex towards a hasted, ‘one-size-fits-all’ reform that failed to take into account the specificities of each case. Undeniably, the effect of the Napoleonic legacy cannot be isolated from other ‘determinants of reform’ (Meyer-Sahling, 2009) that influence the process of administrative change, which, however, go beyond the scope of this paper.

Conclusions

The Eurozone crisis has seemingly triggered a forced (re-)activation of the reform dynamics in the southern European periphery. Focusing on public administration, this paper explored the impact of the fiscal consolidation programmes on the southern bureaucracies. Findings indicate that the crisis has affected national administrative systems at least in two critical aspects: First, by largely synchronizing the dispersed paths of policy agendas and second, by specifying and narrowing the focus of administrative reforms towards financial efficiency.

With reference to the first research question, the impact of the crisis on the process of administrative reform varies across countries. The policy mix was characterized by similarities in the goals and the content of the reform agenda, but by notable differences in the intensity and the duration of the implementation programmes. In line with the three analytical variables, policy responses exhibited greater convergence regarding administrative functions, some similar structural shifts in Greece, Portugal and Spain and deeper changes in the area of human resources in Greece and Portugal. Reform programmes initiated new tools and some radical measures, mostly related to public spending and financial management systems. However, while policy agendas have changed, as suggested by the first theoretical proposition (TPI), the observed shifts were mostly related to the fiscal consolidation/adjustment process than to a coherent reform pattern.

The administrative reform agenda set out a range of ambitious goals, but policy outcomes had a limited impact. Empirical evidence showed that the fiscal measures had a symmetric positive effect on the financial performance of the public sector. On the contrary, structural reforms have not yet produced clear outcomes, whereas most qualitative indicators tend to have been adversely affected. A key finding that relates to the second research question is the absence of a clear pattern of administrative reform that would substantially differ from the Napoleonic one.

Notwithstanding other causal factors in the process of institutional change or continuity, the results of the reform programmes were correlated with the ‘filtering’ effect of the administrative tradition. This explanation is consistent with the second theoretical proposition (TP2). The Napoleonic tradition has been a critical mediating variable in the interplay between the external reform pressure and the endogenous administrative dynamics. Moreover, some of the core Napoleonic features of the southern administrations, such as centralization and political control over the bureaucracy, have been strengthened in the crisis years, implying a backward tendency, rather than a shift towards new, alternative paradigms, as the third theoretical proposition posits (TP3).

To conclude, this paper offered some theoretical insights into the relationship between administrative tradition and change and an empirical assessment of the Eurozone crisis’ impact on southern bureaucracies. Clearly, the explanatory power of administrative tradition must not be overestimated. Further research could expand upon the findings of this paper, exploring the post-adjustment reform paths as well as the role of context-dependent variables, within and beyond the administrative systems and across diverse administrative families.

Footnotes

Acknowledgements

The author would like to thank Calliope Spanou and George Pagoulatos.

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

Notes

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