Some Reflections on Public Sector Reforms | Muhammad Munir Ahmed

REFORMING the civil services has remained a cherished goal of political parties and military regimes alike during the nearly 70 years of Pakistan’s existence.

In 1988, international donors like the World Bank and the IMF had also joined this effort by linking their economic assistance with a number of covenants to improve the country’s bureaucratic set-up. The involvement of international financial institutions divided the structural reform agenda into one for the financial sector and another for the public sector.

Pakistan registered a great deal of success in the case of financial sector reforms, but noticeable progress could not be made in the case of the government sector. Now, the current government is said to soon embark upon an agenda of civil service reforms.

By the mid-1990s, the financial sector was mainly suffering from four problems. First, there was large-scale over-staffing, marked by inefficient employees. Second, the entire working was manual-based and involved the maintenance of large ledgers and allied documents. Third, banks were performing non-core functions like maintaining transport pools or houses and apartments for executives of various grades.

And fourth, administrative laws and procedures were being used to provide legal shelter to non-productive activities like trade unions and employee quotas in recruitments and promotions. These four ills were strong enough to hijack any reform initiative of bank managements.

But the reform agenda started in a big way after the granting of autonomy to the State Bank of Pakistan in 1997. This was followed by the offering of voluntary and mandatory (in some cases) golden handshake packages to bank staffers, thereby considerably reducing the size of the workforce.

After this, the entire manual workings were gradually automated. Young and qualified officers were inducted in banks at almost all levels. Redundant, overlapping hierarchies at different management levels were abolished, which resulted in improved performance. And to do all this, administrative laws and procedures were revised accordingly, in keeping with modern requirements.

Yet, public sector reforms have remained on the discussion agenda with donor institutions with different governments for decades, but very little precious have been achieved so far in this regard. The ills of public-sector institutions today are similar to those of the financial sector at the turn of the 21st century.

A largely non-performing and tenured workforce, redundancies/functional overlapping between different ministries and departments, unnecessary management tiers, and adherence to non-core functions are some of the main obstacles in the way of any reform agenda, both at the federal and provincial levels.

For example, after the 18th amendment, a number of functions were shifted from the federation to the provinces, but hardly any reduction in the federal workforce was made.

During the seven years of democratic rule in the country, the agenda of adminstrative reforms was virtually shelved as the two ruling political parties came up with mega projects with questionable viability and whose implementation was not possible without the help of the bureaucracy.

A civil service, through its policies,systems and mandate, is supposed to be a partner in achieving socioeconomic growth. Such a role is played in societies which reflect a strong commitment for service and growth, both at the governmental and non-governmental levels. The success of Malaysia’s Mahathir Muhammad, among other things, was attributed to the dedicated help he received from his bureaucracy, who had full faith in the validity and the legitimacy of the policies of their premier.

The civil services of Pakistan represent a qualified workforce that has been groomed through quality training at home and abroad and posted at key managerial and administrative positions in the country. By virtue of this patronage and protection, these officers have developed the will and the skill to rule — not to serve. And this mindset of ruling is further compounded in the presence of lopsided political will.

The implementation of public welfare projects through the existing bureaucratic set-up is not likely to deliver in the desired manner unless the civil service is trained and groomed to serve and not to rule.

In this context, the prime minister’s decision for wholesale civil service reforms is worth appreciating. However, to achieve meaningful outcomes, some prerequisites are essential.

First of all, there is a dire need for a strong political will that supports merit and transparency. The success story of financial sector reforms may be taken as a guide. Voluntary and compulsory golden handshake packages and exit policies for bureaucrats nearing retirement age (or having bad reputation) need to be made an integral part of the reform strategy.

And while the adoption of information technology has progressed at a faster pace in the government sector, allied reforms — like those that remove redundancies and duplication of work between different departments and ministries — have yet to be taken.

Last and most important, the ownership and leadership of the reform agenda should not be entrusted to any ex-senior bureaucrat, as has been the story in the past. For accomplishing this tall order, a competent incumbent from the private sector with an unblemished track record may be the best choice and the findings then implemented in true letter and spirit.

The writer is President, Institute of Banking and Business Learning.

Published in Dawn, Business & Finance weekly, October 19th , 2015

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