The elephant in the room

Bureaucracy’s fast spiral downwards must be contained to prevent it from falling into complete disarray

The elephant in the room

Whenever there is a discussion on what is holding Pakistan back, the elephant in the room is bureaucracy. So, what is wrong with bureaucracy, or should I say what wrong has it done to the country? For the answer, we need to dig a bit into its historical evolution. Pakistan’s administrative machinery, in particular its infamous bureaucracy, is profoundly influenced by its colonial legacy. The British had created authoritative and exceedingly centralised bureaucratic institutions to rule the empire.

Although the British built strong governance institutions tailored to their needs - established on the philosophy of extractive institutions - the same institutions hindered the effective functioning of the newly formed state. The new administration was not supposed to rule and extract resources with a heavy hand, instead it needed to strive for inclusiveness and selfless service to people.

During the course of the country’s more than seventy years of journey, many reforms were initiated without any robust change. Since 1947, a total of 29 commissions/ committees have been formulated to chalk out a roadmap for civil services reforms. None can be attributed with a significant outcome.

Despite all the efforts, there is a near consensus that the civil service continues to fail to perform its roles and responsibilities. Most of the reform deliberations merely tinkered with organisational restructuring, minor adjustment of pay scales, creation, merger, or disbanding of occupational groups and changes in functions and powers of some offices. The reforms have failed to address critical issues of accountability, meritocracy, and competence.

The popular view is that their inefficiencies have increased while the research and policymaking capacity has declined. Even when some good recommendations have been made, they have been ignored. For instance, the AR Cornelius Commission recommended abolishing both the sharp demarcation between federal and provincial civil services and including more specialists and professionals at all levels. These recommendations, which never got implemented, were to integrate the civil servants with their field of specialisation, making a more efficient civil service.

The civil service’s performance can be judged from the World Bank’s regulatory quality index, on which Pakistan’s score is consistently low. In 2018, Pakistan’s score on the index was lower than the South Asian median.

Not surprisingly, these reform efforts have failed to improve the performance of the civil service. Instead, these may have set up a system for “perk-maximisation” and political quid pro quo for perks. It can be inferred that the thirst or daring for reforms in the real essence always took a back-seat. This was probably because most of the reformers themselves were not free from the clutches of the legacy mentioned earlier.

In this context, the Pakistan Institute of Development Economics (PIDE), as part of its overarching civil services reforms’ efforts, unpacks its reform agenda for civil service and recommends the needed reforms. The civil service’s performance can be judged from the World Bank’s regulatory quality index, on which Pakistan’s score is consistently low. In 2018, Pakistan’s score on the index was again lower than the South Asian median score.

Other indicators, such as the government effectiveness index, also tell a similar story. Interestingly, the PIDE observers that so far there has been no real analysis of the total cost of civil servants, including not just the pay but all the monetary and non-monetary perks. In PIDE’s view, the reform should begin by adequately compensating all civil servants so that their welfare is not compromised. Previous pay commissions’ recommendations failed because they recommended only an increase in pay and allowances while sticking to the existing system.

The monetisation of all perks should be a priority as it would give not only a more accurate picture of the remunerations but also reduce the disparities that exist within the structure. The monetisation of the housing facility would free up the land, and utilising this land for commercial, economic activity could result in an investment potential of Rs 6-10 trillion. This is equivalent of about $60-100 billion or 30 to 50 per cent of our GDP.

If one component of the reform package can generate this much value, imagine the potential gains other complementing reforms could bring with it. It is time for serious reforms; otherwise, we would not be able to cope with the contemporary requirements for governance, and a few years down the lane, the bureaucratic apparatus would be gearing faster towards a dysfunctional domain.

The writer is a research economist at the Pakistan Institute of Development Economics (PIDE), Islamabad

The elephant in the room