Decisions related to human resources management (HRM), including on recruitment, setting of pay or allocation of posts, can be taken by central HRM authorities or delegated to line ministries, departments or agencies and further down the line to the unit/team level. Delegating these decisions can provide flexibility to managers to adapt the working conditions in the workplace to the needs of their organisation and to the individual employees’ preferences and performance. Under the appropriate general frameworks and minimum standards, this could lead to a better alignment of human resources planning and management to the strategy of the organisation. However, without some degree of central guidelines and oversight arrangements delegation could instead produce uneven pay scales and consequently pay competition among organisations, limit opportunities for government-wide strategic HR planning, create barriers to mobility inside the civil service, open the door to nepotism and political interference in staffing decisions.
The composite index presented here summarises the extent of delegation of HRM practices to line ministries in central government of the Western Balkan region. The 0 value of the index represents no delegation of decision-making in HRM to line ministries/agencies, while 1 denotes the opposite: high level of delegation. Neither of these extremes happen in any countries where data have been collected by the OECD, rather a mix of central rule-setting and delegated implementation to various degrees are commonplace. Where the pendulum stops in each country depends on historical and cultural traditions and current development challenges of the states, as well as the extent of public sector reforms.
Results show that there is little variation across the area, and that the Western Balkans on average are somewhat more centralised in the HRM decision making with an index value of 0.56 than both the OECD and the OECD–EU countries – with similar average values of 0.64. This general difference between the values for the Western Balkans and OECD countries could be explained by the fact that countries and economies in the Western Balkan region are small in comparison to OECD countries, there are shortages of HRM professionals in government, and perhaps because of efforts to prevent politicisation and nepotism, which are key challenges in the Western Balkan region. Besides, countries with advanced levels of managerial accountability as a result of long-standing tradition (such as Sweden) can afford more delegation (decentralisation). North Macedonia (0.64) and Serbia (0.63) delegate more extensively, being closest to the OECD and the OECD-EU averages, while Albania delegates the least (0.49). The setting up of performance appraisal systems, the decisions on the number and the allocation of posts within an organisation and on the variable portion of pay are most often shared between the central HRM body and the line ministries. The latter is the only HRM function in the region that in one country (Serbia) is fully delegated to the line ministries.
In Albania, the country that delegates the least, allocation of the budget envelope is the responsibility of the Ministry of Finance, while recruitment and the setting up of the performance appraisal system is the sole responsibility of the central HRM body and only in the case of flexibility of working conditions have line ministries some say in decision-making beside the central HRM.
In Serbia – one of the countries that delegates the most – only the general management of the pay system and the setting up of the performance appraisal system are completely centralised; recruitment into the civil service and the decisions related to the flexibility of working conditions are the responsibility of the HRM body with some latitude for ministries, while the allocation of posts and the budget envelope between payroll and other expenses are shared between the central HRM body and the line ministries. In North Macedonia only recruitment in the civil service is completely centralised, in all other HRM decisions either there is some latitude for line ministries (performance appraisals, flexibility of working conditions) or the decisions are shared between the central HRM body and the line ministries.
