Corruption is not the problem. Rather, corruption, nepotism and special interests are the symptoms of a deep-rooted malaise in our government system that is threatening to dismantle democracy.
The need to usher in better governance is not an academic issue. Good governance has very tangible benefits in terms of money. It improves the fiscal position and allows the government to directly impact the lives of people that need government’s support. It also creates a more sustainable and prolonged growth cycle by making more and more investments for the future.
Let me draw the attention of the House to the interesting language in the economic survey authored by the finance minister's Economic Advisor Kaushik Basu: “For India to develop faster and do better as an economy, it is, therefore, important to foster the culture of honesty and trustworthiness.” It also states: “Hence, to cut down on corruption and pilferage, we have to design policies in such a way that there is no incentive for ordinary citizens and the enforcers of the law to cheat.”
Sir, the problems of governance arise from the issue of “unfettered discretion”. Unfettered administrative discretion in dealing with public assets and unfettered administrative discretion in doling out government contracts and spending with very little oversight and failure/compromise of institutions like independent regulators, leading to repeated instances of public policy and regulatory capture by vested interests.
The current telecom scam is such an example of compromised regulators, public policy capture by vested interests and administrative discretion being used to the fullest to benefit some private interests.
The solutions for this are obvious. The finance minister must usher into the government a value for money culture, a culture that reinforces the truth that the government is only a trustee of public money and assets. The spending of this money and the handling of public assets must always pass the test of national good, and not in the misused public interest argument that's often used to give scarce national assets to private interests.
I would propose a four point strategy for this:
First: Statutory disclosures by all government departments on commercial decisions. Disclosures are the best way to keep government departments honest. Knowing that their financial decisions are available for media and people to scrutinize, without relying on the RTI, is a great way to encourage honesty.
Second: More effective finance ministry oversight on all decisions relating to spending, contracts and public assets.
Third: Increased use of technology for ensuring better disclosure and expenditure management, specifically, the TAGUP's (Technology Advisory Group for Unique Projects) recommendations of an Expenditure Information System should be implemented.
Fourth: A re-look at the independent regulatory institutions.
If pursued, these will be the catalysts for introducing a culture of fiscal responsibility and value for public money within the government.
I have no doubt that there will be the usual arguments made from within some parts of the government that these would slow down administrative decision making. But, those should be brushed aside. To quote John F. Kennedy: “The problems of this world cannot possibly be solved by skeptics or cynics whose horizons are limited by the obvious realities. We need men who can dream of things that never were.”
Sir, let me dwell a bit on the last issue of regulators which the finance minister had touched upon in his speech and the prime minister spoke about last year. Sir, in recent years, independent regulators have become parking spots for bureaucrats. They cannot and should not become another layer of bureaucracy. We must create motivated, public service oriented and specialist people who want to serve as independent regulators.
Telecom is a classic case where very poorly equipped or people with questionable motivation were put as regulators and they have presided over the public policy capture by vested interests. The Supreme Court also has said recently that the CVC need not be chosen from retired bureaucrats. Creating a set of credible regulatory institutions is one of the most important requirements of delivering governance and improving the state of governance.
Excerpts from the speech of Member of Parliament Rajeev Chandrasekhar, on the Union Budget, Rajya Sabha, March 10
