Presentation Andreas Athanasiades : ABR project Cyprus

Project for the
Reduction of the
Administrative Burden
in Cyprus
March 13th 2014
Project Information
Contracting Authority
Ministry of Finance, Directorate of Economic
Research and EU Affairs
Start Date : November 2009
End Date : February 2011
Budget
: ~ € 500K
Utilized subject matter experts from Germany,
Belgium and local resources in Cyprus
2
Project Scope
1. Measure AB affecting businesses
2. Identify the causes of AB (law, process, etc)
3. Provide suggestions to reduce AB
Focus Points:
• Businesses not individuals
• Large number of businesses affected
• Obligations included
 creating information to demonstrate compliance
 keeping records to allow inspection
 publishing information to third parties
 generating and providing reports to government
3
Project Steps
1. Collection of all the relevant legislation documents
Collected 1.900+ legislations valid from 1960 to 2007
from over 50 Government Agencies/Departments
4
Project Steps
2. Mapping of all Information Obligations
More than 5.500 Information Obligations (IOs) affecting
businesses were identified in the legislation and recorded
in tables
5
Project Steps
3. Selection of the 8 National Priority Areas (NPA)
 Used quantitative and qualitative criteria, such as:
• Number of Information Obligations
• Number of affected businesses
• Source of legislation (National vs. European)
• Likelihood to reduce Administrative Burden
• Type of affected businesses (small – medium)
• Examples from other countries
• Other criteria (Economy, Foreign Investments etc)
 Deliberation – Consultation with relevant bodies
6
National Priority Areas
Immigration
Agriculture
Internal
Revenue
Company
Registrar
Social
Security
Environment
Tourism
VAT
7
Project Steps
4. Analysis of the IOs of the 8 NPA
Each Information Obligation was broken down into Data
Requirements and it’s associated Activities and classified
as Easy, Medium or Hard
Using data from 600 questionnaires collected from
businesses and a validation process from expert groups,
timetables were constructed
The resource cost for 3 professional levels was calculated
Affected number of businesses for each IO was estimated
8
Project Steps
5. Calculation of AB for each IO using the Standard
Cost Model
Administrative Cost = Time x Rate x Population
Administrative Cost = Administrative Burden + BAU
9
Project Steps
6. Provide suggestions for the reduction of the AB
•
Calculate Total AB
•
Locate areas with high AB
•
Identify causes of AB (law, process, repetition, etc)
•
Provide suggestions to reduce AB
•
Perform Impact Analysis on suggestions
Technology
Legislation
Adjustments
Change in
Process/Activities
Project Steps
6. Provide suggestions for the reduction of the AB
Horizontal Suggestions ( 4 )
Vertical Suggestions
( 29 )
Project Results
Project Results
TOTAL COSTS FOR THE 8 PRIORITY AREAS
TOTAL COST
ADMIN BURDEN
%
BUSINESS AS USUAL
%
1.008.561.085
704.604.196
70%
303.956.889
30%
13
Project Results
Administrative Burden per Legislation Area
Legislation Area
€
383.159.511
1
Internal revenue
2
Registrar of Companies 195.171.269
3
VAT
78.935.375
4
Social Security
39.521.511
5
Environment
4.524.888
6
Immigration
2.394.472
7
Tourism
744.270
8
Agriculture
152.900
TOTAL
704.604.196
14
Project Results
ADMINISTRATIVE BURDEN REDUCTION
Horizontal
Suggestion 1 (€)
%
Vertical Suggestions
(€)
%
31.869.262
4%
123.540.523
18%
Total Reduction
%
155.409.785 22%
15
Sample Suggestions
Horizontal Suggestions
Promotion of the Government Electronic Systems
Campaign to promote the electronic services of the Government.
Offer incentives to stimulate the use of the electronic systems and at the
same time counter-incentives to reduce the usage of the traditional
methods
Other Horizontal Suggestions
- e-Filing
- Payments Portal
- Data Warehouse
17
Sample Suggestions - Internal Revenue
 Reduce record-keeping requirements from 7 to 6 to 5 yrs
 Establish minimum contract amounts for stamps
 Automated Payments for PAYE tax
18
Sample Suggestions – Department of Registrar of
Companies and Official Receiver
 Fast-track registration of companies using pre-defined templates
 Allow the submission of financial statements in English Language
 Electronic Submission of Annual Report and other forms
19
Sample Suggestions - VAT
 Reduction of the number of VAT filings per year, based on a company
classification scheme
 Simplification of the payment process, to eliminate the need for
presence both at the Bank and the VAT offices
20
Sample Suggestions – Social Security
 Simplification of the current process to obtain access to the electronic
payments system
 Create fast track counters to service customers with single payments
21
Sample Suggestions - Environment
 Prepare templates for the compliance report and the non-conformity
report
 Simplification of the method used to evaluate the Preliminary Report
on Environmental Impact
22
Sample Suggestions – Immigration Department
 Unification of forms M88 (Entry Visa), M61(Temporary Stay) and M64
(Work permit)
23
Other Government
Transformation Projects
Sample Government Transformation Projects
Agency : Ministry of Interior, Town Planning and Housing Department
Topic : Study for establishing and operating a Single Town Planning Authority
Year
: 2011-2012
Agency : Cyprus Energy Regulatory Authority
Topic : Business Transformation and Automation of the CERA
Year
: 2012-2013
Agency : Ministry of Interior, Department of Lands and Surveys
Topic : Strategic Plan and automation of the Department of Lands and Surveys
Year
: 2012 – ongoing
Agency : Cyprus Tourism Organization
Topic : Reorganization of the Cyprus Tourism Organization
Year
: 2013 - ongoing
Agency : Cyprus Ports Authority
Topic : Advising CPA for the implementation of a Port Community System
Year
: 2012 - ongoing
25
Lessons Learned
What causes Administrative Burden

Too many repetitions (monthly, quarterly submissions)

Personal presence required for information submissions

Manual Payments (cheques)

Lack of information inter-exchange between departments

Unnecessary/difficult requirements on forms – absence of instructions

Submission of duplicated information (on forms & evidence)

Minimal use of automated systems – hard to use, unknown to citizens–
27
Other Typical Observations

Lack of standardization
- Instructions, requirements, documentation, process, may differ among tellers

Complicated processes, often contain unnecessary steps

Unnecessary supporting documentation required often created by same dept
asking for it

Unnecessary requirement for signature

Electronic signature vs. Login Authentication vs. Email

Personal Data Protection misinterpretation
28
Andreas Athanasiades
Principal
Management Consulting
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Tel: +357 22 209019
andreas.athanasiades@kpmg.com.cy