Management Mantras: Make Way for New Public Administration

Sauvik Chakraverti
The Times of India, July 14, 2004

Prime minister Manmohan Singh's call for a revamp of the government itself as a top priority means that the subject of modern public administration has arrived. Classical public administration, based on the works of Max Weber, looked favourably at bureaucracy as a mode of organisation in public affairs. According to Weber, bureaucracy lent legitimacy to the ruler by providing what he termed 'rational-legal administration', or government based on reason and law. The very fact that the prime minister has identified government re-organisation as a top priority implies that India's bureaucracy has failed on this score.

Modern public administration shook itself of the bureaucratic mould in the 1980s, amidst certain political and intellectual trends. In politics, both Reagan and Thatcher had taken a strong stand that government deficits must be curtailed.

Various studies went into analysing the phenomenal growth in the share of government in GDP in these countries since the Second World War. It was in this environment that William Niskanen, who was then at Harvard and currently heads Cato Institute, came out with a neat theory that, just as businessmen maximise profits and consumers utility, bureaucrats maximise budgets! The bureaucrat was identified as Public Enemy No. 1. It was because of his 'economic rationality' that government budgets were refusing to go down. The bureaucrat must go — this became the rallying cry of a new movement in the field of administration called the New Public Management (NPM).

At this point, let us pause to reflect on our predicament. It is not only that our budget deficit is huge and refusing to come down. We have the added problem that not a single function is performed satisfactorily by our gigantic bureaucracy. The latter problem was not faced by the western countries where the NPM movement began.

At its basic level, NPM says that whatever the public good or service to be 'provided' by the government, the same good or service should be 'produced' by the private sector. The government should not be both the provider as well as the producer. Indeed, the government should produce nothing at all. Whatever it has to provide, it should do so by 'outsourcing' to the private sector. To see how this works, let us take the case of a service the government must provide: garbage collection. And let us contrast the NPM approach to that of the bureaucracy.

If the task of garbage collection is given to a bureaucracy, people end up paying for a huge municipal department employing thousands of people, from sweepers to clerks to officers, which will purchase trucks, brooms and what have you. For all this it will have a budget — which, as we now know, it will be 'economically rational' on the part of the bureau chief to maximise.

Worse, if we examine the work done by the bureau chief, we find that he spends all his time processing 'bureau inputs': Leave, discipline, promotion, transfers and purchases. He has little time to process 'bureau output' and see to it that the town is cleaned up.

Under NPM, there would be no bureau — just a single public official awarding contracts to private garbage disposal companies and then spending his entire time seeing that these companies perform as per their contracts. Which method will yield better public hygiene at lower cost?

We could go on examining NPM solutions to India's multifarious problems. For example, primary education. At least in cities and towns, a minimum number of officials could be hired to issue education 'vouchers' to poor children, which could entitle them to free education at any private primary school of their choice. Food stamps may do a better and cheaper job of dispensing food aid to the poor than what the FCI and PDS do today. We could extend the logic even to prisons and urban roads (built on contract, without a state organisation like the PWD).

The prime minister also said that India now has 30 cities with more than a million inhabitants each. He mentioned the need to solve the problems of these cities. I am confident that each city must be filthier than the next. I propose that NPM be applied to garbage collection in all these cities, inviting internationally known expertise. A lot can be learnt from this experience, after which NPM can be applied to other areas. Of course, the locus of NPM will remain the city or town, where the need for goods and services to be provided collectively are the highest.

Simultaneously, efforts should be made to introduce modern public administration in the curriculum of probationers at tax-funded institutes, like the IAS academy. At the IAS academy today, old officers train the young. There is, therefore, too much intellectual inbreeding. The IAS controls the discourse on public administration in India and has hindered the development of rigorous and open-minded research in the area. There can scarcely be an academic-practitioner interface if the IAS plays both roles! An intellectual revolution in public administration should accompany demonstrable change on the ground to improve the lot of people in India's bustling cities and towns. Initially, NPM practitioners can be hired from the international skills market and IAS officers made to learn from them.

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