CONTRACT MANAGEMENT: A NEW GOVERNMENT POLICY FOR OUTPUT FINANCING OF PRODUCTS AND SERVICES

VAN HARTEVELT, HANS
Royal Tropical Institute (KIT)

Abstract
During the last decades operations of KIT's Library depended largely on government funding. In 1999, based on the new European regulations in the field of subsidising, the Ministry decided on a new policy based on contract management and output financing to fund products and services instead of financing the activities. More emphasis had to be put on the co-operation with institutes in developing countries and all the Library's activities were to be placed in user and usage perspectives. In addition, the Ministry introduced three objectives with regard to the Library's operations: a) concentration on the identification of information projects in developing countries; b) provision, in partnerships, of free access to its holdings to organisations in developing countries; and c) supply of information to development professionals in the Western world. The success of the above objectives will depend on identifying partners wishing to participate in the formulation of programmes, seeking of funding and joint execution.

Keywords: Government funding; Information services; Development assistance; Output financing; Partnerships

GESTION CONTRACTUELLE : UNE NOUVELLE POLITIQUE DU GOUVERNEMENT POUR LE FINANCEMENT DES RESULTATS OBTENUS, PLUS PARTICULIEREMENT LE FINANCEMENT DES PRODUITS ET DES SERVICE

Résumé
Au cours des dernieres décades, le travail de la Bibliotheque du KIT dépendait largement de la subvention par le Gouvernement. Selon les nouveaux reglements européens dans le domaine des subventions, le Ministere a adopté une nouvelle politique de gestion contractuelle ainsi qu'une nouvelle politique de financement des résultats obtenus dans le but de financer les produits et les services au lieu de financer les activités. Il a fallu mettre plus d'accent sur la coopération avec des instituts dans les pays en voie de développement et placer toutes les activités de la Bibliotheque dans le cadre des perspectives de l'utilisateur et de l'utilisation. De plus, le Ministere a introduit trois objectifs en ce qui concerne le travail de la Bibliotheque : a) se concentrer sur l'identification de projets d'information ; b) en collaboration avec les partenaires, donner un acces libre a ses collections, aux organisations dans les pays en voie de développement, c) fournir de l'information aux spécialistes en développement a l'Occident. Le succes des objectifs cités ci-dessus dépendra de l'identification des partenaires qui veulent participer a la formulation des programmes, chercher des financements et exécution concourant.

Mots clé : Financement par le Gouvernement ; Services d'information ; Assistance au développement ; Financement des résultats obtenus ; Partenariat

1 Introduction
The history of the Library of the Royal Tropical Institute (Koninklijk Instituut voor de Tropen) dates back to 1777. Since then the Library has undergone several changes and has been governed by various bodies. The mission, however, has always remained the same: to gather and disseminate knowledge of overseas regions, beginning with the former colonies and evolving into the tropics. Since 1910 (the official establishment of KIT) many library collections from private and public organisations have been handed over to KIT and have been merged into its own vast holdings which to date include some 250,000 books, 15,000 journals and 25,000 maps, all pertaining to the tropics. In addition KIT holds some 200,000 documents, in the form of brochures, unique manuscripts, newspapers and monographs, which belong to the national Dutch cultural heritage.
Today, the Library, employing a total staff of 60, is an independent department which comprises the Documentation, the Map Collection and the 'commercial' information management unit which has implemented projects in over 50 different countries in Africa, Asia, Latin America and the former Soviet Union republics. The annual budget totals e4 million which comes from the Ministry of Foreign Affairs. In addition to this the Library generates additional revenue to the tune of e300,000 - e500,000 from the market sector by implementing projects and raising funds through sponsorships. In the 1950s, the KIT-Library broadened its scope by publishing its abstracting journal in English instead of Dutch. TROPAG, in its different formats, found its way to libraries all over the world. The only changes in policy were based on the ever developing information technology. The abstracts which were issued in printed form since 1953 were made available in electronic format as an online database accessible through telecommunication facilities in 1975 and on CD-ROM in 1988. Apart from the ICT revolution, the Library also had to face the financial consequences of an economic crises which lead to Government cutbacks. This forced the Library to generate alternative funds in order to cover its ever increasing costs.

2. New policy
In 1999, the year the Euro was officially introduced in Europe, the Government of the Netherlands changed its policy towards funding of organisations such as KIT. In anticipation of the economic and financial integration of the European Union, and the new EU regulations in the field of subsidising, the Government decided to discontinue its existing relationship with KIT and to replace it by a new agreement, based on contract management. The new agreement had to be discussed in the framework of output financing, and funding of products and services instead of subsidising activities. The Institute was divided and decentralised into several modules such as Museum, Theatre, Agricultural Development, and Library. For each module products and services had to be defined in terms of output and made comparable with similar products and services rendered by other organisations not only in the Netherlands but also in the member states of the European Union. External auditing bureaux reviewed the products and services in terms of efficiency and costs in order to establish pricing standards for output. This was followed by a process of negotiations between the module managers and the relevant management of the Ministry of Foreign Affairs. A transition period for the implementation of the contract was eventually fixed at three years.
For the Library traditional activities such as acquisition, cataloguing, indexing, abstracting, documentation, database management, automation, loan services and lending, shelving, current awareness, etc. were no longer accepted as activities for direct subsidy. All the activities had to be placed in user and usage perspective and were transformed into products and services. The number of information sources and its management were no longer accepted as indicators. The number of users had to be defined and indicated on a quarterly basis. The same applies to the items catalogued; these were no longer relevant, only the number of records retrieved were fundable. Funding will now be made available based on statistics given in reports which have to be submitted quarterly.
If the targets are not met, funding will be withheld, despite ongoing fixed costs for personnel and acquisitions. Not only quantity is important, in addition the Library also has to assess the quality. User appreciation has to be measured, as does the most frequent and less frequently retrieved items.
The risks are of course enormous. Not only financially speaking if and when targets are not met, but also in terms of collection building, since the collection (quality and its entirety) is no longer subject to review, but to the following of fashions and trends.

3. Strategy
In general the Ministry argued that available funds had to be used partly to initiate partnerships with institutions in overseas countries, rather than in the Netherlands alone. The justification of the Library's existence had to be found in its co-operative programmes the developing world. To realise this and to maintain the facilities on which the products and services had to be based at an acceptable level, three basic strategies were formulated.

3.1 Institutional Partnerships
Ever since its existence, the Library was equipped to render its services not only to users in the tropics but also to researchers, development workers and students in the Netherlands visiting the Library. Now the Ministry had decided that researchers and students are no longer the target audience of the Library and as such can only be served marginally. The visiting hours of the Library for this group of users therefore have to be limited in favour of the identification of institutional partners for final co-operation.

3.2 Co-ordination and co-operation with libraries and information services in The Netherlands
The funds for collection development will eventually decrease, partly because the Ministry will not provide any additional funds for price compensation and partly because more money will have to be allocated to products and services to be launched in the developing world. In order to keep the coverage of professional literature at an acceptable level, KIT has to identify Dutch partners with whom an agreement can be made for the co-ordination of collection policy and also to generate additional income.

3.3 Synergy
In the design of its products, such as pathfinders, internet publications, and information services, the Library has to study the possibilities of achieving more synergy between the various actors involved in the development process both in the Western and Southern world.

4. Objectives
Following the above mission and strategy an agreement was finally reached to meet three objectives to be realised during the contract period of four years.

4.1 Technical Co-operation
In addition to its market activities, the Library has to contribute to the establishment of information services strengthening organisations involved in agricultural and rural development. The main focus of this contribution will be identification and formulation of information projects together with partners in the developing world. Ultimately, financially viable proposals have to be submitted to donor agencies for funding of the formulated projects. The total number of projects has been fixed at 8-12 per year.

The following criteria in order to accept proposals submitted have been developed:
- In general the projects may not compete with those in the 'market'.
- The funds have to be used in the developing world, excluding conferences, courses, publications, etc. in the western world. Projects requiring open-ended funding will not be considered.
- Projects have to fall within the overall framework of agricultural and rural development.
- Target audiences consist of organisations involved in the development process such as policy-makers, development workers, researchers, extension workers and information intermediaries.
Furthermore, the following indicators for success will be used: sustainability, involvement of the counterpart through (small) contributions, accountability; fundability, regional function, measurable objectives.
One of the projects which was clearly agreed upon is the so-called international co-operation to produce the TROPAG database. To date, two partners have been identified in China and India and additional partners are being sought in Africa and Latin America. In short, KIT provides facilities (equipment and courses) to enable the partners to contribute to the TROPAG database for which KIT pays a fee. The ultimate objective of this project is to investigate the feasibility of transferring the entire production of the agricultural database to the partners involved or parties interested.

4.2 Information supply to specific target audiences in developing countries
Based on the information sources available in Amsterdam, products, such as the TROPAG database, newsletters and the publication Gender, Development and Society have to be produced in order to provide access to the Library's vast resources. Also traditional question and answer services and document delivery services are provided. The costs involved in providing these services are covered in the contract between the Ministry and KIT, with the exception of the publications for which a subscription fee is still required.
In addition the Library has to identify 5-6 partner organisations in the developing world in order to support an information flow between KIT and the partners overseas, also comprising the above services which will be funded by the Ministry.

4.3 Information supply to development professionals and information intermediaries in western countries.
Question and answer services as well as document delivery services can be provided at no charge to organisations involved in development work.

In conclusion, although the new policy is a challenge for the future a balance has to be found between implementation and the continued existence of a precious collection of 250,000 books, 15,000 journals, 25,000 maps and approximately 200,000 documents belonging to the Dutch cultural heritage all pertaining to the developing region which has been gathered over centuries.
The above policy and objectives have to be realised during the contract period which will be reviewed for extension in December 2002. Partners wishing to participate in the implementation are invited to contact the Royal Tropical Institute.