Thus a third hypothesis concerns the need for coordination among different government agencies. Enforcing compliance requires sharing information, particularly the tax authorities, business registries, social security administration and health and safety authorities. This is necessary because regulatory and tax evasion are harder to track than many other types of crime. Many OECD countries, for example, have introduced laws allowing the transfer of information among social security administrations, social services, the revenue authorities and health insurers. Some, such as the UK, have also allowed information sharing between these government agencies and private banks, utilities and educational establishments in an effort to eradicate social security fraud. In Ireland individuals not registered with the tax authorities are identified ‘among other things by information on rent subsidy payments, purchases of property etc.’ (OECD, 2004, 263).

Most developing countries lack such information-sharing mechanisms. In Morocco, for example, companies receive different identification numbers from the social security ministry, tax authorities and company registrar – making it impossible to trace their activities. This might appear to be a relatively simple technical issue, requiring the installation of an automated common system but in practice it is complicated by interagency rivalries and reluctance to cooperate.<sup>12</sup> Several countries have experimented by introducing ‘one-stop shops’ for business registration that enable government agencies to draw on a single database and that might, theoretically at least, help them to identify evaders. A proposed scheme for Costa Rica, for instance, would provide common registration information to the tax authorities, social security institute, ministry of health and municipal chambers of commerce (World Bank, 2006, 15).

Since responsibility for implementation typically lies at the local level, effective policymaking also requires cooperation between across different levels of government. One of the emerging lessons from the South African experience is that ‘the support and environmental needs of formal and informal enterprises are much the same, but governance in the business environment and in local government can operate in such a way as to create bottlenecks and constraints for the majority of smaller and poorer workers.’<sup>13</sup> Meanwhile in Vietnam provincial authorities implemented a national Enterprise Law in such a way as to produce serious inconsistencies between its content and regulations on the ground (Kurz and Frode, 72, 2005) – with corresponding differences in the propensity of firms to register. A more positive example comes from Brazil, where the federal government established a National Antipiracy Council with members from seven government departments and private sector representatives. This has allowed more cooperation among the Federal Police, Internal Revenue and customs authorities and has led to several joint-policy operations. One result has been to cut smuggling along the Paraguayan border by 30 percent (Kenyon and Kapaz, 2005).

_Improving the quality of public management:_

> 12 Interview with Najy Benhassine, Senior Private Sector Development Specialist, World Bank. 13 Lund and Skinner, 2005, p. 3.

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