Dissatisfaction with public services tends to make most people distrust and discount the promises made by governments. When repeated visits have to be made to an electricity office to get a new connection or to restore a faulty line; or when the payment of a tax is made arbitrary and complex, people become cynical about the services. If, added to this, a person has to pay a bribe to get a service he has already paid for, he will no doubt feel enraged. The callousness and lack of accountability rampant in many public offices raises the question: why are leaders in government unable to cleanse the system?

Published by Books For Change, 2002 -- Click image for for ordering information Before we examine the reasons for the crisis in public services, it is necessary to understand the context in which they operate. As noted above, the state has traditionally been the dominant, if not the sole provider of public services in most countries, including India. Private participation had played a notable role in the nineteenth century in some countries. But the economic and political importance of infrastructure, the "spill over effects" of some of the investments, difficulties in excluding people from the benefits of certain services even if they did not pay for them, and the strong public interest underlying infrastructure have caused governments to initiate and invest in a big way in public services. Technological compulsions have reinforced these factors. The new capital intensive technologies associated with some of the services required a large scale of operation and vast resources.

A second feature of the Indian context is the tremendous overload of functions the government has taken upon itself. It has not only to deliver essential public services to the people, but also manage numerous commercial and development enterprises, apart from designing and implementing policies pertaining to a variety of sectors in the economy. Government's burden has been exacerbated by the limitations of the citizens whom they have to serve. The vast majority of the people have low levels of education and limited awareness of their own rights and entitlements. The kind of administrative systems that can effectively cope with these limitations are not yet in place. This has many implications for the current state of the public services.

Traditional mechanisms such as public audit of government expenditure and legislative oversight are stretched to the limit by this system overload. The thrust of these mechanisms is on the review of inputs. Expenditures are audited to see whether proper procedures and norms have been adhered to. While this is an aspect of accountability, it does not tell us anything about how well the money was spent. This is because very little attention is given to the outputs and outcomes of the inputs. The problem is exacerbated by the difficulties in measuring outputs and in monitoring field level activities. Grievance redressal systems are nominal at best and often unable to satisfactorily respond to the problems of the thousands of customers served by the public agencies.

The problems described above have also resulted in a substantial lag in the reform of the legal and regulatory system so essential to the design and delivery of essential services. Administrators typically try to work within the framework of the laws and regulations of their organisations. Accounts get audited because a law requires them to do so. Investments are made according to the laws and regulations governing the organisation. If the law is silent on the standards and other attributes of services, provider agencies are likely to pay less attention to them. A recent comparison of the legislation on electricity in the U.K., U.S.A., and India has shown that while in the other two countries attention is given to the standards and quality of services and to consumer protection, the focus of the Indian legislation is on investment and supply. When norms of service and standards of reliability are not spelt out and enforced, it is difficult for customers to hold a service provider accountable for performance. True, even when legal inadequacies are rectified, improved accountability may not automatically follow. But a well-designed legal framework can provide an enabling environment for the public to demand improved accountability.

While the historical trends and customs of a society can no doubt provide useful perspectives, it is equally important to identify the proximate factors that have brought our public services to the present state.
The contextual factors described above are not unique to the state of public services in India. Other developing countries also are known for their inefficient and non-responsive governments and service agencies. Industrially developed countries too had encountered similar problems and their history offers interesting examples of their strategies to cope with these issues. In the early part of this century, cities in the USA were poorly managed, and were known for their widespread patronage and corruption. A deliberate move to eliminate these evils and to professionalise city management was launched at that time with the active involvement of the American presidents of that era. In the city of Chicago, a non-governmental movement led by the Municipal League was instrumental in fighting corruption and other abuses of power in the city's governance. Journalists and other activists effectively exposed corruption in high places. Movements of this genre in the US led to a clean break with the past and the creation of new municipal management systems, professionalisation of personnel and organisational practices that dramatically improved the public services.

Some would argue that the quality of public services will improve and public accountability will be enhanced only when incomes rise and poverty and illiteracy are eradicated. According to this view, the pace of change cannot be forced as many historical and cultural factors and traditions are at work. Higher levels of income, education, and organisational capabilities will certainly create a more fertile environment for improved services and accountability. However, experiences of developed countries clearly show that, irrespective of income levels, without deliberate strategies for reform, public agencies are unlikely to initiate steps to improve their services. In the last elections in the United Kingdom, Prime Minister Tony Blair placed the improvement of public services such as health at the top of his campaign agenda. It underscores the importance that developed country leaders attach to public services despite the higher level of attainment prevalent in their countries. One can hardly think of a case from a developing country where elections are fought on public service reforms.

The example from the U.K. is a case in point. Improved public services therefore do not automatically follow increased income levels. On the other hand, even countries with lower incomes can have governments that are responsive to public needs and are concerned about better service delivery as the needed reforms do not always require substantial financial resources.

There are infrastructural services, of course, that require considerable capital investment. But other kinds of reforms such as improved management systems, budgetary practices, simplification of laws and regulations, and transparency call for committed leadership, coalition building, staff training, and better supervision rather than big investments. In Guntur, a small city in India, a reform minded municipal commissioner has successfully introduced e-governance measures that have improved the speed and transparency in the issue of building permits and other certificates. Another example that will be discussed in some detail in a later chapter is the introduction of self-assessment of the property tax in Bangalore, a reform that has substantially reduced citizen harassment and corruption.

Individual public services encounter many specific constraints and problems unique to them. But to get a broader picture of what ails our public services, it is necessary to look for the common factors that adversely affect all or most of them. Some would argue that feudal traditions and values and the role of elites in our society are at the root of the problem. While the historical trends and customs of a society can no doubt provide useful perspectives, it is equally important to identify the proximate factors that have brought our public services to the present state. Experts on government and experienced administrators who have a wider perspective on these matters have speculated on the different reasons for the unsatisfactory state of public services.

Resource Constraints
Most planners and policy makers tend to cite resource constraints as the key barrier to the quantitative and qualitative improvement of public services. And they are partly right because the expansion and upgrading of most infrastructural services do call for heavy investments. Governments tax, borrow, and receive foreign aid in order to finance these investments. Unreliable supply of electricity, telecommunications, or water may well be due to a paucity of funds to improve these facilities. However, all problems of public services cannot be attributed to resource constraints.

If we probe into the resource constraints argument a bit deeper, we may find that there are other underlying problems that cause such constraints. Failures of government policy create shortages that ordinary citizens and even politicians do not fully comprehend. By providing electricity free or at nominal cost to large segments of the population such as farmers, governments create undue pressure on scarce resources. Policy decisions not to meter the electricity consumption of favored groups encourage the latter to waste energy. The end result is the inability of the government to generate the resources necessary to expand the supply of electricity and to improve the reliability of the service. While the problem may be explained away as a case of resource constraints, it has its roots in unsustainable or unsound policies.

The expansion of India's population and of its cities and towns, would no doubt call for increased resources to finance public services. But expanding cities also create new wealth and increased scope for resource mobilisation. This potential is, however, seldom tapped. On the other hand, we find that the smaller towns that did not expand are no better in terms of their essential services. Expansion can cause strains, no doubt, but cannot fully explain indifferent performance.

If resources were scarce, as the planners claim, one would expect greater care and efficiency in their utilisation. However, there are many examples of government's failure even to fully utilise available funds. The perplexing phenomenon in India is the failure of the government to effectively utilise the funds available for its numerous projects; many of them funded by international lending or donor agencies. The World Bank, for example, has compared the track record of both China and India with respect to the utilisation of approved project loans. The finding is that India is much behind China in this regard. The Finance Minister of India, in his budget presentation in February 2001, has pointed out that a significant portion of the funds allocated to the defense budget (a high priority sector), has remained unutilised. The bottleneck here is not the lack of resources, but poor planning of projects, slow decision making, and internal conflicts and pulls that make it difficult to move forward with speed. It is difficult to agree that lack of access to resources is the key barrier facing the government in such situations.

Even services that do not call for substantial resources are in an unsatisfactory state. Many public agencies, for example, are of a regulatory nature. They check on the compliance with the law, issue licenses or permits, and advise clients on how to utilise existing schemes. Though capital investment is not an issue here, their performance in terms of service delivery leaves much to be desired. The responsiveness of their staff to the needs of the public is often rated low.

Ample evidence on the extent and severity of these problems exists. Citizens encounter the most archaic procedures and long delays in getting approvals for building plans or getting a ration card from the civil supplies authorities. None of these services are capital intensive and streamlining their internal administrative systems and practices is not a superhuman task. It is possible, however, that the modest funds required for streamlining the jobs are not made available to the agencies concerned. The end result is that essential public services are neglected without anyone being held accountable.

What is the purpose of building hospitals or schools without ensuring that the complementary inputs (e.g., medicines, blackboards, doctors, teachers, etc.,) are available?
Neglect of the maintenance of existing public assets is one of the reasons for the poor quality of services. The resource constraints argument may have some validity when it comes to the allocation of funds for the maintenance of facilities. Government planners have a preference for using funds for new investment projects. They may give money for constructing new roads, but may not provide adequate funds for the subsequent maintenance of the assets thus created. The priority is for the creation of new capital assets, not for operating them. This tendency is reinforced by foreign aid donors who prefer to give money for investment in new projects, rather than for the maintenance of existing projects or activities. Donors typically extract a promise on paper from the government that the new assets will be properly maintained. But few donors have the clout or interest to enforce these promises.

Thus government may build expensive water supply schemes and hospitals. But when the projects are completed and the plan period is over, the maintenance of these facilities is left to be financed from the government's recurrent budget. The revenues allocated to meet such recurrent costs are limited. In general, governments are not keen to levy appropriate user charges for a variety of reasons. At the end of the day, the squeeze is on the operation and maintenance of the services. Resources have been spent on building costly assets. But adequate resources are not available for their effective use. This is indeed a criminal waste, especially when the funds used to create these assets have to be repaid with interest to creditors, within the country or without. This is a problem of internal allocation and prioritising of funds.

What is the purpose of building hospitals or schools without ensuring that the complementary inputs (e.g., medicines, blackboards, doctors, teachers, etc.,) are available? Maintenance is supposed to be part of the non-plan expenditure in the budget that is considered lower priority. It is encouraging that there is a growing realisation in government that the artificial distinction between plan and non-plan expenditures needs to be done away with.

Resource constraints may arise also because government and its agencies are reluctant or ineffective in collecting the revenues people can be expected to pay. The classic case is the reluctance to tax agriculture even when it is clear that significant numbers of farmers can afford to pay. The leakage in the collection of excise and customs duties is another example. More controversial is the failure of our state governments to charge rural farmers for the use of electricity and to control its widespread theft. Municipalities and other local governments are notorious for their failure to levy and collect taxes, which are within their rights. Not long ago, in Ahmedabad, a dynamic municipal commissioner won fulsome praise from the media and the public by doubling the city's revenues simply by enforcing the law on existing octroi and property taxes. He was not only able to expand and improve the city's services but also generate a surplus, a rare achievement indeed. The plea that resources are inadequate can thus be a cover for the reluctance and inability to collect the revenues that are due to the government.

Series : Why are our Public Services Unsatisfactory?

(Next: II)