Toto recall


The warlocks at the Punjab Civil Secretariat share a lot in common with the Wizard of Oz. In the cult classic, Toto the dog pulls back the curtain to reveal that the powerful wizard is really nothing more than a geezer using levers and pulleys to dupe people into believing in his omnipotence. And today one will be the Toto to your Dorothy as we lift the veil off a new mode of public service delivery that is being hailed as a success around these parts. The Wizard may have been benign, but the bureaucracy behind our curtain is anything but.

Last week’s column (Dirty Business) helped to highlight some of the inherent problems with the muddled corporate approach to waste management in Lahore. The fear now is that this approach to service delivery is going to spread. In many ways, the province of the Punjab is like the elder brother to siblings in our federation who look to it for guidance or replication. But while it may have gained a reputation for being progressive in the past, strange experiments are now underway. And so it is important to not only raise the alarm but to also wash the blood off one’s hands for the role they played in initiating this new corporate mode of service delivery.

Once upon a time the responsibility to draft a legislative amendment for the Lahore Transport Company (LTC) fell upon your favourite columnist – an underling in a government think-tank. But back then, the strategy was to break the transport mafia’s back by enabling a government run non-profit company with enough incentives to get the transporters to sign up as members and agree to internal rules that keep quality of services in check. While the concept seemed to work, the LTC amendments went through the rigours of the bureaucracy and legislature and came out mutilated.

The amended law placed functions of regulation, service provision, asset management and planning in a single entity, thus ringing the death knell for the LTC even before it moved into a swanky office to twiddle its fingers. It is now being reported that after a spate of turf and budget wars between the LTC and the Punjab Transport Department, our leaders (and a certain Dr Frankenstein) are voicing their displeasure over this experiment.

Oddly enough, what happened to the LTC has already become the gold standard for institutional development in several sectors of the Punjab. So beware. These new companies are not successes in service delivery but excuses from a government that is unwilling and unable to reform existing institutions before creating new ones. And soon the people are going to figure out that the government has locked us into a development trajectory from which it will be impossible to depart should things turn sour.

A government that only seems to be interested in creating new entities to be the policy-maker, planner, regulator, financier and provider of a range of essential and non-essential services must follow three key steps in developing a road map for institutional reform if it is serious about getting back to the business of government.

At the risk of repeating oneself, the government needs to turn the tide by investing in core functions that are best performed exclusively by the public sector. These would entail policy-oriented functions such as regulation and licensing, resource allocations, and standardization. Secondly, the government needs to identify those functions that are ancillary to core government functions, but need not be carried out exclusively by the public sector. The key here is to enable private sector-led service delivery by outsourcing functions such as municipal service delivery to more efficient providers. Finally, the government needs to desist from carrying out functions that it is not responsible for nor supposed to perform. These include many of the support services related to the production and consumption of economic goods and services, and asset management and maintenance.

But while immediate reform is required to curtail unnecessary public sector operations and to create the regulatory and fiscal space for more efficient private sector operators to fill this gap, the government has chosen to take an entirely different tack. The problem seems to be rooted in the policy framework governing service delivery. Without any guidelines on the constitution and composition of such companies, the government is creating artificial monopolies that will inevitably force out competition in virtually every sector instead of nurturing it. In view of the financial constraints on the government, it is only possible to achieve economic growth by removing whimsical anomalies that impede true non-state actors from providing goods and services within a competitive environment.

The real anomalies before us are our warlocks who have perfected the art of finding a cushy job with one of these Mickey Mouse companies. Sitting in glass and chrome offices, our babus may feel high and mighty but their masquerade parties are starting to irritate citizens and are setting a bad example for others in the federation. Perhaps it’s time someone told them we are not in Kansas anymore.


The writer is a consultant on public policy.