Presentation by Pall Thorhallsson at the OECD Workshop on “Joint Learning for an OECD Trust Strategy” on 14 October 2013. Mr. Thorhallsson discusses the pre-crash situation, the nature of the 2008 crash, and the crash's impact on trust. He also mentions reasons for the lacking trust.
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Rebuilding trust following the economic crash
1. Rebuilding trust following the
economic crash
Pall Thorhallsson, Director General, Prime
Minister´s Office
2. Pre-crash situation
• Trust in public institutions generally high
• High voter turnout
• Iceland considered to be relatively free from
corruption
3. The nature of the 2008 crash
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All major banks collapsed
The currency fell dramatically
Housing loans skyrocketed
Moral and political crisis
Huge disillusionment and anger towards
bankers and the authorities
4. Political landscape
• 2009-2013 First purely left-wing government
in the history of the republic
• 2013-? The center- and right-wing parties are
back in power again
5. 2009-2013 – investigations and
accountability
• Unprecedented parliamentary investigation of
the causes of the collapse
• Former Prime Minister taken to State Court
• Criminal investigation of the banks, several
hundred cases
6. 2009-2013 - reform projects
• Constitutional reform process with a directly
elected constitutional convention
• Revised information law, granting wider access
to public documents
• Ethical codes for the public service with a
lawbased coordination committee
• School of central government created
• Improved selection procedure for toppositions in the civil service
7. 2009-2013 other reform and
developments
• EU accession bid
• Attempts to revise the fishing quota system
and make the quota owners pay more to the
State
• Restructuring of banks, companies and private
household debts
• Presidential power increases
• Crisis in relations with UK and NL (Icesave)
8. Preliminary results?
• Some reforms were adopted
• For others the former government did not
have enough time or inner strength to
complete them
• Remains to be seen what the new government
aims to do in the field of governance reform
9. Impact on trust
• Trust in institutions remains relatively high
• Trust in politicians is very low
• Voter turnout is still relatively high
10. Reasons for lack of trust
• 79% mention the political culture, political
fight and disrespect instead of cooperation
• 72% mention working methods in Parliament,
Parliament not listening to the people, not
having the right priorities
(Survey commissioned by Parliament)
11. Preliminary lessons
• The crisis created opportunities for reform
• Reforms which enjoy broad political support
(which may be hard to create) have bigger
chance of success
• Need to manage expectations, cf. the
constitutional reform which failed