# Challenging inertia with sunset clauses (_An earlier Portuguese [version](https://exame.com/colunistas/instituto-millenium/clausulas-de-caducidade-podem-tirar-setor-publico-da-inercia/) of this text appeared on October 16, 2023, in Instituto Millenium’s column for Exame magazine_) One of the most significant challenges in the public sector is what we might term "[[# Institutional Paralysis|administrative inertia]]" -the tendency for established systems and practices to persist even when they become obsolete or ineffective. In the private sector, fierce competition and market forces often topple companies that fail to adapt quickly. In the public sector, however, the absence of this type of pressure, combined with a series of other institutional and cultural barriers, can inhibit innovation. "Path dependence" illustrates this resistance to change. Over time, the public sector accumulates legacy systems, processes, and practices - a "technical debt" that can become an obstacle to innovation. However, this resistance is not merely a function of the nature of the public sector or bureaucratic inertia. It is rooted in institutional incentives and society's expectations of government. When citizens look to the state, they seek stability, predictability, and security. In a constantly changing world, the government's ability to provide these assurances is essential. Thus, responses like "I don't know" or "let's test it out" from public authorities are viewed with suspicion, leading to an environment averse to risk and experimentation. In a setting where risk is frequently punished and stability is valued, how can there be room for innovation? This is a matter of institutional design. Our laws, practices, and governance culture are shaped in such a way that they favor impersonality and conformity over efficiency, adaptability, and problem-solving. Relevant examples include our practices for recruiting personnel and procuring goods and services. The civil service examination system ensures impersonality but fails to provide the state with the necessary human resources to solve complex problems. Similarly, procurement legislation prioritizes fair competition among suppliers rather than the state's ability to acquire supplies that best meet public needs. But there are ways to change this dynamic. "[[Sunset Clauses]]" represent an interesting solution. These are clauses integrated into legislation that establish an expiration date for a legislative act or public entity unless there is an intervention by the legislature to renew it. The interval between the enactment of a law and its expiration date can vary, usually ranging from four to twelve years. These clauses often determine that the legislation or entity in question will undergo a review, which is frequently conducted by specialized legislative teams or external auditors. These professionals may suggest the termination of the entity or legislation, its continuation with modifications, or the maintenance of its current format. Such a mechanism is crucial for strengthening the role of legislative assemblies in the debate and formulation of policies, as the executive branch often holds the preponderance in decisions about public management. This approach promotes not only continuous evaluation but also efficiency and the pursuit of relevance. Entities are aware that they must justify their relevance, thus being encouraged to offer value to society. More than 35 American states adopt some type of structured procedure for evaluating public policies based on sunset clauses, although the approaches and scope vary considerably among them ([Baugus & Bose, 2015](https://www.mercatus.org/research/research-papers/sunset-legislation-states-balancing-legislature-and-executive)). In many states, dedicated commissions conduct the evaluations, relying on specialized teams that analyze the effectiveness, efficiency, and necessity of each entity under review. These analyses are often accompanied by public hearings, allowing the public and stakeholders to actively participate in the decision-making process. [Texas](https://www.sunset.texas.gov/public/uploads/files/reports/Sunset%20in%20Texas%202022-23.pdf) is an important reference. In 1977, the local legislature established a commission dedicated to conducting these evaluations. Since then, 42 agencies and programs have been terminated, while 52 have had their functions transferred or consolidated with other entities. The result of this initiative was a saving of over 1 billion dollars and the completion of more than 570 evaluations. In 2021 alone, following the recommendations of this commission, 31 types of licenses in 18 regulatory areas were eliminated, streamlining processes for over 140,000 institutions. In Brazil, we also observe the benefits of such evaluations in the improvement of public policies. The legislation regarding quotas in higher education and [FUNDEB](https://todospelaeducacao.org.br/noticias/novo-fundeb-aprovado-no-congresso-nacional/) (Fund for the Maintenance and Development of Basic Education and Valorization of Education Professionals) incorporate sunset clauses and periodic reevaluation. The renewal of both pieces of legislation testifies to how these mechanisms have the potential to enrich public debate and, consequently, refine legislative drafting and improve the formulation of public policies. However, these evaluations should not be seen as threats or punitive exercises. Instead, they should be understood as opportunities to learn, adapt, and evolve. The key is to create a governance culture that values reflection, learning, and the ability to change. And, perhaps most importantly, that recognizes that innovation in the public sector, as in the private sector, requires courage, creativity, and a willingness to take risks.