Thursday, 12 December 2013

Why are appointments in Pakistan so badly made?

People are totally confused about the economy. One way of looking at the economy is that it is the aggregate of all economic decisions taken in a time period. If the government is run on archaic principles with poor decision-making, don’t expect great outcomes for the economy.
The process of human resource management in the government is at the heart of the slow growth in our economy. Think about it. Let me give you some food for thought.

All appointments in Pakistan’s public sector are highly centralized. The refrain is that we cannot trust appointments to be decentralized for there will be poor quality appointments and possible corruption. Hence the rationale for secretaries and bureaucrats to be on all governing bodies of public sector enterprises, including universitiesthink-tank’s and other non-profits. Meanwhile the principle accounting officer of all these bodies remains the secretary who does meddle and vitiate the authority of the board and the CEO.

The result is that we have a system of diffused responsibilities so that no clear goals or business plans in any agency or organization.

Why do we cling to this system when the results have been atrocious? No I am not exaggerating. The results have been atrocious. Public sector enterprises have been badly managed and are bleeding at over Rs. 500 billion rupees annually; universities and all educational institutions continue to be poorly managed; and most government nonprofits as well as regulatory agencies are treated as parking lots for retired bureaucrats.

All board and all senior appointments everywhere are made directly by the PM. Positions lie empty for months even years.  Files are sent to PM offices where they wait for months and all manner of bureaucrats’ advice on those appointments and even then most often a poor outcome emerges. Politics and other motives then contaminate this appointment process.
Then there is the fiction of all positions must be advertised and interviewed. Who will conduct the interview the secretaries. It is not surprising that all advertisements produce no serious appointments. Serious professionals do not want to be treated poorly, subjected to an interview by non-professionals, wait to hear the PM office for months, and more than likely learn that some retired bureaucrat was preferred. And if you do get the appointment, you will never have independent charge since the secretary and all manner of people will interfere. And of course the PM has arbitrary authority to fire you at will.
Then there is the fiction of salary. A big deal is made out of the MP1. It is all told about Rs. 3.5 lacs which is just about the rental value of the house that most grade 21 and 22 bureaucrats get. And of course these MP1s have no right to a plot which all the bureaucrats get. Not to mention the myriads of other perks as well as lucrative board appointments.
To add insult to injury, MP1s have contracts of 2 years which have to be approved/extended by bureaucrats—a committee of secretaries headed by the Finance Secretary. Often MP1s are waiting for approval for months without salary. And often they leave with many months’ salary owed to them.
The fiction in all countries is that we serve at the whims of the chief executive. But in reality that is not true. Obama cannot fire people at will or transfer them from Utah to Nebraska on whim.Recall when his administration was being set up there was a panel of staffers who were “recommending” serious candidates and if commentators are to be believed, Obama had limited say in the process.
And some appointments the chief executive does not even get into. Prime among these are vice chancellors and professors which are appointed through systems in academia without involving government or its functionaries. PSEs should be run like any company by their boards and held accountable to their bottom-line.
It is time that the human resource management (HRM) in government was taken seriously. The fiction of PM making all appointments may be kept but the PM must not get involved in more than choosing his ministers.  The rest of the system has to be developed such that serious professional can be brought in and not be totally subservient to secretaries. Indeed the secretaries grip over the system needs to be loosened.  
Better HRM is the key to development and we must learnt that. US has led the world by developing an HRM system that attracts the best talent from all over. They are ready to pass a new immigration bill primarily for this purpose. Our archaic system must change!
Can we expect good outcomes from a system that is so poorly managed?