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July 4, 2020

Taming the shrew

Business

July 4, 2020

LAHORE: It is a good sign that normalcy has returned at least in export sector without going back to the zero-rating regime. It is perhaps the only economic issue where this government has shown consistency and it is paying back.

Government would have to show the same resolve in case of documentation as well. Its dilly dallying on the CNIC issue has strengthened the resolve of tax evaders to force the government to withdraw this condition.

Government writ is linked to the commitment of the ruling elite on any issue. When the government hesitates in implementing any measures promoting transparency, it indicates that the ruling elite doubt the efficiency of the transparency measures.

The problem with implementation of transparent measures is that those who benefit from opaque or translucent policies oppose it tooth and nail. These elements have influence in the corridors of power including the bureaucracy.

In fact, the first resistance to transparent reforms comes from the bureaucrats. They have vested interest in non-implementation of rules and regulations.

Violation of rules or the power of discretion is their greatest tool for rent-seeking. All reforms are resisted at the bureaucratic level in such a manner that makes it look that no rules are violated.

A glimpse of this behaviour was witnessed during the first tenure of Nawaz government in 1997. His younger brother Shahbaz Sharif was chief minister Punjab.

The CM was informed that at the customs level in Lahore there is an institutionalised system under which every consignment whether large or small is cleared by paying a small rent at every stage the clearing invoice is moved.

So much so that when the door is opened for taking the cleared goods out, the importer whether company or individual has to pay a token amount to the gatekeeper. The then chief minister decided to strictly eliminate this petty bribe.

Since his brother was at the centre, he succeeded in keeping a very strict watch at every level. The institutional bribe stopped, but the goods clearance was done at a snail’s pace.

The invoice was scrutinised at each of the 14 counters where it has to pass and each counter slapped some objection. Many documents that were not demanded when bribe was open were called for.

It resulted in piling up of cases to an extent that, importers and individuals both started protesting. Many industrial inputs were struck up. Finally the vigilance was removed and clearance as usual was allowed.

This proved that bureaucratic red tape is very strong and bureaucratic command on rules and regulations is much stronger. The matter was shelved and forgotten instead of going for a deep study.

In most of the offices that do public dealing, there are certain rules incorporated that have to be complied with or which the concerned bureaucrat could ignore on his/her discretion. If we go through the records at all government offices, we will find that in most cases no

additional documents were called for clearance of an issue and in perhaps one percent of the cases objection after objections were raised.

Since we all know about institutionalised corruption, we can infer that in cases where the institutionalised rent was paid the cases are processed speedily and where bribe was denied, additional documents were asked for.

Why can we not make the procedures simply and leave nothing on the discretion of the bureaucrats. All necessary documents needed for the purpose of transparency and fairness should be presented by all at the time of presentation of their cases and must be promptly approved. There should be no need for any additional or unnecessary documents by any bureaucrat.

Before this exercise, the state should evaluate the average daily clearance of cases by bureaucrats in each type. That should be followed with reforms.

Bureaucrats must be bound to clear the same number of average files that they used to clear in rent seeking days. The proceeding on each counter should be under the scrutiny of a camera.

It would not cost much, but it would save the unnecessary bribe paid by businesses and individuals seeking government services. The system can be reformed by taking on one department at a time or even one station at a time.

The resistance to CNIC comes from bureaucrats as well. If the economy is fully documented their rent seeking mill would go bankrupt.

They would then not be able to send their children to elite schools and colleges in Pakistan and abroad.

Their families would not be buying expensive local and foreign brands.

Their mobile phones would range between Rs12,000-Rs20,000 instead of Rs110,000 to Rs150,000. To bring down bureaucrats to commoners level is an uphill task that has proved beyond the power of any government in Pakistan.