The latest pay commission report was a disappointment. Any organisation that cares about performance would be delusional to carry out a compensation review without a simultaneous review of organisation structure and human capital. But a commission member felt “such a review falls well beyond the mandate of this commission”. Even if that is literally true, most impactful mandates are not given physically but taken spiritually; the most exasperating but perhaps most common response of civil servants is “above my pay grade” and “outside my job description”. We currently treat our best bureaucrats badly because we don’t punish bad ones; our government has become too big for small things and too small for big things; and the state is unable to deliver on its own intentions.
Blaming India’s bureaucracy for all this is silly. India and Pakistan, born on the same night, have had very different democratic destinies for many reasons, but one of them has been our national civil service cadre (notables include V.P. Menon for the integration of princely states and Sukumar Sen for our first election). On the other hand, India and China, with the same per capita GDPs in 1970, have had very different economic, education and health destinies for many reasons, but one of them has been the monopoly of the permanent, generalist civil services. The only job of the civil services is execution, but not only is the bureaucracy’s collective performance on that narrow metric painful, many bureaucrats don’t have the specialisation to deliver the 12 projects detailed in Nandan Nilekani’s wonderful new co-authored book, Rebooting India. Further, the notion that bureaucrats must protect India from its politicians is wrong and not dissimilar to academic Daniel Bell’s case in his recent book, The China Model, that choosing country leadership without elections delivers superior policy outcomes. The book is interesting but irrelevant. In a democracy, policy is a child of politics.
The first avatar of India’s bureaucracy was the Indian Civil Service (ICS), which Subhas Chandra Bose refused to join because “the ICS perpetuates the British empire” and Jawaharlal Nehru felt “was neither Indian nor Civil nor Service”. The second avatar began after Independence. Sardar Patel convinced Nehru of the importance of a “uniform national administrative structure with considerable central control”. Ironically, assimilating 562 British franchise operations — the princely states — along with Partition made a system designed to control 300 million subjects seem like the right configuration to govern 300 million citizens. It was the right call: A permanent generalist civil services staffed by a highly meritocratic selection process led to a golden period for the civil services because politicians and bureaucrats were idealistic and frugal, one-party democracy kept the political economy simple, and the primary goal was nation-building. The third avatar began in the 1970s, when the national political monopoly broke down, politics became the country’s highest EBITDA (earnings before interest, taxes, depreciation and amortisation) margin business, idealism diminished and bureaucrats began taking sides (the biggest surprise for me in Coomi Kapoor’s great book, The Emergency: A Personal History was how civil servants fell in line). This led to them losing their independence, retaining their permanence and amplifying their “generalness”. It also coincided with the start of the period — 25 years after Independence — when nation-building skills became less important than poverty reduction skills.
The fourth avatar of the bureaucracy should be about creating an adventurous and accountable state focused on execution. Moving to a cost-to-government structure that monetises all benefits, like houses and cars, and enrols everybody in the employee state insurance and provident fund schemes will enable a more liquid and fluid civil servant labour market. Sharper performance management will end the “outstanding” ranking for 95 per cent of civil servants, which punishes the good and honest ones. This will also enable giving top jobs to 45-year-olds. Then, it will replicate the up-or-out colonel threshold of the army, which prevents the pyramid from becoming a cylinder; people not shortlisted for promotion beyond joint secretary should retire early. It will create a UPSC-administered lateral entry process at the level of joint secretary, equal to 30 per cent of staff. It will introduce an equivalent of Australia’s senior executive service, under which all appointments after joint secretary will be done on five-year contracts through an open application process.
It will enable 25 per cent of all senior positions to be co-terminus political appointees confirmed by a standard and transparent vetting process. It will create a culture of bold decision-making with explicit legal protections; the backseat drivers and post-mortems of the last decade have created an understandable preference for following rules over doing the right thing. It will reduce the physical and spiritual distance from normal people — largely adopted from the British — like red lights/ stars/ flags on cars, drivers, off-book government-paid armies at home, an excessive security apparatus, peons, separate lines, etc, because state legitimacy is corroded by the pedestal narrative. It will reduce the size of the Central government by accelerating the transfer of funds, functions and functionaries to state capitals. It will separate regulator, shareholder and policymaker roles in all areas, and shift government ownership of all PSUs from line ministries to a single holding company tasked with governance and human capital.
The Indian state is not designed for the scale, complexity and accountability it faces. This is not the bureaucracy’s fault. Change will be most sustainable and effective if it comes from inside the civil services, but their senior leadership often spend their final years trying to get post-retirement jobs, rather than caring about systemic reform or their younger colleagues. Change from outside is a second-best choice, but it is unrealistic to expect people to cut the tree they are sitting on. We need a new configuration of the capabilities and relationship between siyasat (the politics), hukumat (the state) and awaam (the people). Voters are massively changing politics. But only politicians can do civil service reform.
- Changing our stories
New India’s challenge is thinking about the future with economic stories that don’t ignore or glorify the past. ..
- Moving from jobs to wages
A budget that does not believe that in the long run we are all dead. ..
- Reveal, recognise, resolve
Gap between global banks and Indian banks on bad loan recovery is set to narrow ..