Making the public sector work

President Maithripala Sirisena this week assured public workers that they need not fear the ‘Yahapalanaya’ Government as it would protect efficient and conscientious workers. According to the President, officials are at times reluctant to give approvals to State documents for fear that they will be held accountable at a later date.

Yet, the whole point of accountability is that it should find the correct person responsible for an oversight, if it in fact has happened, and then hold that person responsible. A slew of new measures introduced by the Government over the past year, perhaps chief among them the Right to Information Bill, are targeted at safeguarding public workers by revealing the right person responsible. In most countries whistleblowers are protected by special legislation to uncover corruption and give an additional boost to the judicial system.  

Decades of handing out jobs to gain votes have left a bloated public sector as a burden to society. Recurrent expenditure has become the top priority of the Budget and one that is becoming increasingly difficult to finance given the drop in tax revenue. Bankrolling pensions will also become tougher for the Government as debt repayment responsibilities rise over the next few years. Already pension programs started for fishermen and farmers have been stunted due to lack of resources and the situation will only get worse unless the Government can increase its revenue through investment.

Foreign investment, which is the dream of this Government, is ironically hampered by the same public sector it spends most of its money on maintaining. As pointed out by Prime Minister Ranil Wickremesinghe himself, increased recruitment to the public sector over the past 10 years has resulted in calcified layers of bureaucracy that are hindering foreign investment opportunities into Sri Lanka. 

Many Governments have tinkered with the problem but have found no way to avoid it as Government employment is one of the key expectations of electorates. Most ministers on accepting their portfolios promptly set about recruitment, sometimes for jobs that do not exist. Employees, once they have gained a foothold, unionise and promptly begin demanding more salaries and other perks. Refusal to acquiesce to these demands usually result in strikes that also impact the economy, especially if they are in key sectors such as transport, power and healthcare. 

These rounds of agitation by unions usually ease during election time since both the main parties know that they are going to get a leg up if they promise salary hikes to the 1.3 million public workers of Sri Lanka. This usually sets off a bidding war with both the Sri Lanka Freedom Party (SLFP) and United National Party (UNP) attempting to outdo each other in promises to Government workers. This bargaining power in turn creates more budgetary pressures as the promised increases in salaries not only raise expenditure but also push up inflation. Salary increases over the past two years are credited with boosting Sri Lanka’s growth numbers though at an unsustainable level. Consumption-based perks such as car permits also lose the Government millions of revenue and do not bring inclusive growth. The system has worked well for so long there is little incentive to change it. Therefore good governance has to be approved of and accepted within the system for any real chance of transparency. Accountability is the first step towards changing the public sector.