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.

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