After two accidents in quick succession, Suresh Prabhu resigned as railway minister taking moral responsibility. While the nation awaits a similar moral stand by some of our other leaders, I want to talk about another dimension. Are our institutions geared up for the challenges of running complex systems?
Time and again, the incompetence of our government shows up in the form of avoidable tragedies, agony and deaths. The question is as much about ability to deliver as it is about proper allocation of resources. Uttar Pradesh has a health budget of rupees 17,181 crore, on which the interest per day is about 4 crores. If the state machinery becomes efficient to reduce lead time by one day, then half a dozen bills for essential supplies could be settled with the interest income alone! Further, how to get maximum out of scarce public funds is on nobody's KRA. Does any department in government prioritize which bills to pay first? Is it a surprise then no rational vendor likes to work with the government as a supplier!
Let me share another example showing limitations of government efficiency. India is the number one producer of milk today, thanks to the initiatives by Dr Verghese Kurien. For high productivity of milch animals, the females are routinely impregnated through artificial insemination. This insemination through state happens for free, but rarely achieves a success beyond 25%, in spite of supervision by highly knowledgeable veterinary officer. The same number through private means regularly crosses 33% and often 40%. The reason is simple, bureaucracy. Centralized procurement and fear of vigilance constrain the public functionaries severely. The ability to deliver a simple service, such as a park in a town, is marred with challenges in fund flow, recruitment, procurement, inability to negotiate with customers and suppliers, etc. A private operator would face similar challenges, but would enjoy considerable authority, when compared with a public servant.
Governments across the world have found four ways to overcome state limitations - take the decision making closer to the point of operation, get equipped to handle the complex bureaucracy, create space for private sector in non-essential activities, and finally stop providing certain services (the way most of us lived for ages).
In my view, all four need to be acted upon in India. With the status of our markets, I do not understand why the state needs to operate a dairy, an intercity transport, a commodity business or a power station. Instead, the state needs to concentrate on provision of public goods and better management of welfare outcomes. Decentralized decision making would naturally help, as the powers of most public functionaries are far less than the welfare responsibilities. A District Medical and Health Officer, who is responsible for hundreds of in-patients, has powers to sanction a few lakhs - barely sufficient for a day's worth of supplies.
Unless the state wants to stop providing the services altogether, the state needs to equip its employees and stakeholders with means to achieve the direction given in preceding paragraph. Today, there is no capacity within an employee or a citizen to understand the myriad public system. The acumen necessary to maneuver through the system is missing in most officials. Every year, I talk to hundreds of scientists from government, and their tendency is to shirk administrative parts of their work and concentrate on pure science. Perhaps the bureaucracy has become unwieldy. In my view, an average government employee interacts with many more people compared to a private sector employee doing the same job. A high volume of transactions per unit output is a hallmark of any inefficient operation. These need to be made efficient to stay competitive as a nation. Evolution of practices in banking sector over last two decades could teach us a lot.
Now, let's come back to the railway safety. Has the ministry identified which services it would not provide? I hope its not safety is not on that list. Has the government created space for private sector in non-essential activities? Is the ministry too complex? Is the decision making decentralized? These require a more elaborate assessment. Let me present only two facts before the audience - objectives of the ministry and participation in training.
Firstly, The results framework document of the railways ministry is disappointing on many counts. To begin with, the misplaced priorities of the ministry can be seen from the weights given for objectives that are passenger-centric (14%), freight-centric (20%) and environment-centric (8%). There is an entire ministry to take care of environment, let us not overburden ourselves and increase the already high transactions per output for railway employees. The importance given to passenger traffic volumes (5%) is far less than freight volumes (16%). Further, safety is given 8% weight, albeit it is smartly measured as investment in installations, and not actual record of accidents or near misses - which is the practice in transportation industry. Another misleading metric is the weight given to investments. The weight for capex (17%) and another 12% investments for safety and amenities are deceptively rewarding expenditure, which may or may not be helping the nation. Somewhat better aligned objectives would give a higher importance to safety and volume of business, esp passenger traffic. Clearly the results framework document isn't seeing the wood for the trees.
Secondly, Research Designs and Standards Organization appears to be the only organization within the ministry that can look at technical performance of the ministry and recommend changes to be brought about. I failed to find any document that performed a detailed analysis of an issue (such as role of level crossings in safety) and recommended counter-measures. In my view, the organization seriously lacks capacity to play its role in the vital lifeline of the nation. At Administrative Staff College of India, we organize about a dozen programmes every year aimed to help scientists and engineers link their work with organization objectives. In last 6 years, I have seen nearly 2000 senior professionals from reputed labs pass through ASCI portals. Not one of them was from RDSO, although this training is provided completely free!
I'm sad, but not surprised that people suffer and die during such failures of system. If one visits any public office randomly, then one would observe several inefficiencies that lead us to believe that our lives are just hanging by a thread. Do we continue to tolerate this structural invisible violence by state? As a nation, we do very little to find out systemic deficiencies in our public systems. No public functionary has heard of internal audit, and the Comptroller and Auditor General is reluctant to move beyond monetary measures. A system runs smoothly only when it receives feedback. In India, we like to manipulate and if necessary, trample feedback and put a facade of a welfare state.
Time and again, the incompetence of our government shows up in the form of avoidable tragedies, agony and deaths. The question is as much about ability to deliver as it is about proper allocation of resources. Uttar Pradesh has a health budget of rupees 17,181 crore, on which the interest per day is about 4 crores. If the state machinery becomes efficient to reduce lead time by one day, then half a dozen bills for essential supplies could be settled with the interest income alone! Further, how to get maximum out of scarce public funds is on nobody's KRA. Does any department in government prioritize which bills to pay first? Is it a surprise then no rational vendor likes to work with the government as a supplier!
Let me share another example showing limitations of government efficiency. India is the number one producer of milk today, thanks to the initiatives by Dr Verghese Kurien. For high productivity of milch animals, the females are routinely impregnated through artificial insemination. This insemination through state happens for free, but rarely achieves a success beyond 25%, in spite of supervision by highly knowledgeable veterinary officer. The same number through private means regularly crosses 33% and often 40%. The reason is simple, bureaucracy. Centralized procurement and fear of vigilance constrain the public functionaries severely. The ability to deliver a simple service, such as a park in a town, is marred with challenges in fund flow, recruitment, procurement, inability to negotiate with customers and suppliers, etc. A private operator would face similar challenges, but would enjoy considerable authority, when compared with a public servant.
Governments across the world have found four ways to overcome state limitations - take the decision making closer to the point of operation, get equipped to handle the complex bureaucracy, create space for private sector in non-essential activities, and finally stop providing certain services (the way most of us lived for ages).
In my view, all four need to be acted upon in India. With the status of our markets, I do not understand why the state needs to operate a dairy, an intercity transport, a commodity business or a power station. Instead, the state needs to concentrate on provision of public goods and better management of welfare outcomes. Decentralized decision making would naturally help, as the powers of most public functionaries are far less than the welfare responsibilities. A District Medical and Health Officer, who is responsible for hundreds of in-patients, has powers to sanction a few lakhs - barely sufficient for a day's worth of supplies.
Unless the state wants to stop providing the services altogether, the state needs to equip its employees and stakeholders with means to achieve the direction given in preceding paragraph. Today, there is no capacity within an employee or a citizen to understand the myriad public system. The acumen necessary to maneuver through the system is missing in most officials. Every year, I talk to hundreds of scientists from government, and their tendency is to shirk administrative parts of their work and concentrate on pure science. Perhaps the bureaucracy has become unwieldy. In my view, an average government employee interacts with many more people compared to a private sector employee doing the same job. A high volume of transactions per unit output is a hallmark of any inefficient operation. These need to be made efficient to stay competitive as a nation. Evolution of practices in banking sector over last two decades could teach us a lot.
Now, let's come back to the railway safety. Has the ministry identified which services it would not provide? I hope its not safety is not on that list. Has the government created space for private sector in non-essential activities? Is the ministry too complex? Is the decision making decentralized? These require a more elaborate assessment. Let me present only two facts before the audience - objectives of the ministry and participation in training.
Firstly, The results framework document of the railways ministry is disappointing on many counts. To begin with, the misplaced priorities of the ministry can be seen from the weights given for objectives that are passenger-centric (14%), freight-centric (20%) and environment-centric (8%). There is an entire ministry to take care of environment, let us not overburden ourselves and increase the already high transactions per output for railway employees. The importance given to passenger traffic volumes (5%) is far less than freight volumes (16%). Further, safety is given 8% weight, albeit it is smartly measured as investment in installations, and not actual record of accidents or near misses - which is the practice in transportation industry. Another misleading metric is the weight given to investments. The weight for capex (17%) and another 12% investments for safety and amenities are deceptively rewarding expenditure, which may or may not be helping the nation. Somewhat better aligned objectives would give a higher importance to safety and volume of business, esp passenger traffic. Clearly the results framework document isn't seeing the wood for the trees.
Secondly, Research Designs and Standards Organization appears to be the only organization within the ministry that can look at technical performance of the ministry and recommend changes to be brought about. I failed to find any document that performed a detailed analysis of an issue (such as role of level crossings in safety) and recommended counter-measures. In my view, the organization seriously lacks capacity to play its role in the vital lifeline of the nation. At Administrative Staff College of India, we organize about a dozen programmes every year aimed to help scientists and engineers link their work with organization objectives. In last 6 years, I have seen nearly 2000 senior professionals from reputed labs pass through ASCI portals. Not one of them was from RDSO, although this training is provided completely free!
I'm sad, but not surprised that people suffer and die during such failures of system. If one visits any public office randomly, then one would observe several inefficiencies that lead us to believe that our lives are just hanging by a thread. Do we continue to tolerate this structural invisible violence by state? As a nation, we do very little to find out systemic deficiencies in our public systems. No public functionary has heard of internal audit, and the Comptroller and Auditor General is reluctant to move beyond monetary measures. A system runs smoothly only when it receives feedback. In India, we like to manipulate and if necessary, trample feedback and put a facade of a welfare state.
