5 min readMar 19, 2021 09:00 AM IST
First published on: Mar 19, 2021 at 04:00 AM IST
The lack of administrative reform in India has frustrated many stakeholders for a long time. Occasionally, it finds a voice at the highest levels, most recently when, during a speech in Parliament, Prime Minister Modi complained about the overreach of the elite IAS cadre. Unsurprisingly, one of the key focus areas of such reform is enabling lateral entry into an otherwise “permanent” system of administrators. But the success of lateral entry hinges entirely on how it is designed.
The present government, to its credit, has taken some steps on lateral entry. Eight professionals were recruited for joint secretary-level positions in various ministries. Some other positions at the joint secretary and director-level have been advertised. But this is unlikely to shake up the system which is the entire logic of lateral entry. Here is why.
The terms on which the positions are advertised may dissuade the best from applying. In the permanent system, IAS officers get promoted to joint secretary level after 17 years of service and remain at that level for ten years. The IAS and permanent system are strictly seniority-bound — nobody gets promoted ahead of time. That makes the average age of a joint secretary around 45. Now, if similar experience requirements are used for lateral entry, it is unlikely that the best will join because in the private sector they rise to the top of their profession, in CXO positions, or tenured professorships, at that age.
Their aspiration will be for a higher position. To attract the best talent from outside at the joint secretary level, entry requirements need to be relaxed so that persons of 35 years of age are eligible. The logic extends to other ranks. IAS officers become secretaries to the government after 30 to 33 years of service, which means they are 55 or above. The best talent from outside would only join at 50 or less. If one looks at lateral entry in an earlier generation, among economists, there was much greater flexibility. The likes of Montek Singh Ahluwalia, Bimal Jalan and Vijay Kelkar were joint secretaries in their mid-30s and secretaries by their late 40s or by 50. That is one of the reasons they left lucrative assignments abroad.
The second challenge is whether the system is facilitating lateral entrants for success or is indifferent to the point of failure. There are many dimensions to this. For a start, there are several joint secretaries in each ministry who handle different portfolios. If assigned to an unimportant portfolio, the chances of not making a mark are high. A cursory look at the portfolios of the eight laterally-hired joint secretaries doesn’t suggest that they hold critical portfolios. One entrant has already quit.
There must also be clarity in what precisely is the mandate for the lateral entrant. There is a difference in bringing expertise and being part of the decision-making process. For the former, the government doesn’t strictly need to hire “outsiders”. Expertise is widely available and used by almost every ministry — expert committees, consultations, think tank engagements, etc. To be disrupters, lateral entrants need to be able to stamp their authority on decision making. For this to happen, there need to be more lateral entrants at all levels in ministries. Anyone familiar with the functioning of government knows that there is a long chain in decision-making and a minority of one cannot override it. Also, it requires an understanding of the system and an ability to work with the “permanent” establishment. No training or orientation is provided for this. By the time networks are built, it is time to move on.
On past evidence, the lateral entrants who made the biggest impact are those who served in the system for a length of time and at different levels. The economists mentioned earlier joined as advisers at the joint secretary level before moving up the ladder to mainstream positions, learning to work with the permanent establishment in the process. A recent lateral entrant like Parameswaran Iyer succeeded because he had served in the IAS early on.
Lateral entry, like competition in any sphere, is a good thing. But serious thinking is required on entry requirements, job assignments, number of personnel and training to make it a force for positive change. Some reform of the “permanent” system — particularly its seniority principle — may be a prerequisite.
This article first appeared in the print edition on March 19, 2021 under the title ‘Devil is in the design’. The writer is chief economist, Vedanta & formerly head of Economics & Trade at NITI Aayog.
The present government, to its credit, has taken some steps on lateral entry. 
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