INTERNATIONAL JOURNAL OF ORGANIZATION THEORY AND
BEHAVIOR, 9 (3 ), 352-377
FALL 2006
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND
DEVELOPMENT: THE CASES OF PAKISTAN AND BANGLADESH
Habib Zafarullah*
ABSTRACT. In line with contemporary trends in the developing world,
countries in South Asia are under pressure from both political and civil
societies and the international donor community to recast their
administrative systems. New tools and practices in public governance have
been advanced to remedy structural deficiencies, procedural flaws,
managerial incompetence, and weak accountability in the public sector.
International organizations emphasize the need to improve the relationship
between governance and socio-economic outcome; and accountability,
transparency, probity, predictability, and participation are acknowledged as
essential ingredients for effectively managing development. This article
focuses on two South Asian countries (Pakistan and Bangladesh) and
examines the various measures adopted by their governments to reshape
governance and public management in recent times.
INTRODUCTION
In line with the current trends in the developing world, South
Asian countries are under constant pressure from internal political
and civil societies and international donors to reform their
administrative systems in order to serve the purposes of democratic
governance and development. Various tools in governance and best
practices in public management are being adopted to overcome
structural deficiencies, procedural flaws, managerial incompetence,
and weak accountability mechanisms in the public sector, which in
the past worked either independently or concomitantly to inhibit
----------------------------* Habib Zafarullah, Ph.D., is Associate Professor, School of Social Science,
University of New England, Australia. His major research areas include
democratic governance, comparative bureaucracy, public policy, and
development management.
Copyright © 2006 by PrAcademics Press
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT353
poverty alleviation and the realization of social and economic
development goals. International organizations such as the World
Bank, the International Monetary Fund (IMF), the Asian Development
and the United Nations Development Programme (UNDP), to name a
few, emphasize the need to improve the relationship between
governance and social and economic outcome of public policies and
acknowledge transparency, accountability, probity, predictability, and
participation as essential components of a sound development
management system. Likewise, capacity building in government for
the effective delivery of public service, infusion of service ethos
among its members, decentralization of operations, and citizen
participation in public affairs are recognized as conjointly significant
in creating a robust state-people nexus. Thus, public management
systems require recalibration of its roles, structures, and operations
to effectively respond to the priorities and goals of development.
Since the 1980s, the international donor community (IDC) has
been persistent in demanding governments in developing nations to
be more open to reform and change and to resolve the perpetual
crises in governance. With the enthusiasm for democratic governance
and economic liberalization constantly radiating from New York,
Washington and Geneva to the developing world and as development
assistance is conditional upon reforms to build and strengthen public
institutions, the IDC entreaties have centered on elements of
governance or the state’s capacity to govern effectively. The
reconfiguration of the state’s role in economy and society, creating
balance between national and sub-national power centers to
rejuvenate the local government system, promoting civil society
presence in policy structures, constructing public-private interface for
better economic results, and repositioning and strengthening public
institutions for social development are predicated on sustained public
sector efficiency and performance, predictability, transparency,
accountability, and integrity (World Bank, 2002a; ADB, 1997).
This article focuses on two South Asian countries--Pakistan and
Bangladesh--and examines a range of measures adopted by their
governments in recent times to reshape core functions in governance
and public management. It explores both domestic compulsions and
external interventions that have propelled reforms in the public sector
and encouraged moves to restructure the machinery of government,
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streamline policy development and implementation, facilitate
information access, embrace anti-corruption measures, and create
synergy between government and non-state organizations. From a
contextual perspective, we also look at the attitudes and stance of
the political leadership and the bureaucracy toward reform.
POLITICAL CONTEXT OF REFORM
Pakistan and Bangladesh, as one nation at independence from
the U.K. in 1947, were bequeathed a common governmental legacy
that had powerful influences on bureaucratic behavior and
administrative structures and processes that were put in place to
meet the needs of a post-colonial state. The inherited praxes were
obtusely perpetuated by public officials indoctrinated in colonial rulemaking, rule-articulation, and rule-implementation. They formed the
nucleus of the central and provincial bureaucracies and maintained
ubiquitous influence on governmental affairs, including policymaking
and implementation, in the absence of effective constitutional politics
in the country. Indeed, the political milieu was depraved by wanton
factionalism, polarization, and regionalism with profound implications
for sound state management. The political executive being unwittingly
callow in approaching administrative obligations was “thoughtless in
reaching consensus on key issues, nonchalant of their proper role in
governance and largely driven by parochial political interests”
(Zafarullah, 2003, p. 266).
The failure of democratic politics in the country ushered in military
rule further entrenching bureaucratic domination in governmental
affairs. For over a decade, bureaucratic-authoritarianism under the
canopy of pseudo-democratic/military rule played a pivotal role in
regulating the economy, influencing social life and intervening in
policy development and implementation (Ahmed, 1980; Rizvi, 2000).
The bureaucracy operated on the conscience of its own dictates,
defined the guidelines to ‘control’ itself, demarcated the boundaries
between its identifiable domain and political society, and restrained
the crystallization of an effective civil society. Arguably, it distanced
itself from society and grew insensitive to people’s needs.
Until 1971, when the eastern wing of Pakistan seceded to form
the independent nation of Bangladesh, several concerted attempts
were made to reform the administrative system but these were
essentially inhibited by tough bureaucratic resistance complemented
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT355
by weak political leadership despite favorable conditions for realizing
them. External support for these reform efforts that sought to place
the machinery of government and particularly civil service
management on a rational footing was practically wasted (Khan,
1980). The governmental system, simulating colonial administrative
attributes, was disorganized and thus incapable of achieving desired
policy goals, processes were sloppy producing mal-coordination and
inter-agency conflicts, checks and control mechanisms were flawed
creating scope for bureaucratic malfeasance, relations between the
political executive and the civil service were ambiguous leaving room
for confusion and discord, and the structures for people’s
participation in development were inadequate.
These problems flowed on to the two countries after the
dismemberment of Pakistan. Both faced the same sorts of challenges
in transforming their administrative systems in post-authoritarian
political settings. While the span of governance in Pakistan became
smaller with the breakaway of its eastern wing, for newly independent
Bangladesh it signified the enlargement of a provincial governmental
machinery to serve the purposes of a sovereign nation. The task of
redesigning the two nations’ administrative structures however was
complicated by the prevailing bureaucratic culture that embodied
such elements as elitism, conservatism, red-tapism, insularity,
intransigence, intemperance, patronization, and self-preservation,
and manifested a disdain for political controls and a predilection for
political maneuvering for furthering group interests. Thus, the views
of the bureaucracy, especially that of the elite corps within it, about
its role in society and governance and its orientations and attitudes
toward political and civic structures and the public, became
significant factors in the success of any program for reform and
change.
Frequent political setbacks destabilized the governmental
systems in both countries. The breakdown of constitutional politics
and bouts of military rule have had wide ramifications for establishing
democratic governance and building sound administrative systems.
Since 1971, Pakistan saw two military takeovers by ambitious
generals and several dismissals of universally elected governments
by politically overly zealous and indirectly elected presidents.
Similarly, in Bangladesh, political assassinations, two stints of military
rule, and political malevolence by democratically elected
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governments and opposition forces characterized the political
landscape. In reality, parochial political loyalties, the absence of
commonly endorsed criteria for resolving and managing conflicts and
the ubiquity of continued political distrust between social groups
(including the bureaucracy and civil society clusters) have fabricated
a fragmented political culture in both places, causing incongruity of
views on national issues.(1) Consequently, the planning and
implementation of public management reform measures have been
constrained.
Civilian rule in Pakistan (1988-1999) and Bangladesh (1991 to
date) has been marked by pervasive political and administrative
mismanagement. In the former, the reform agenda was virtually
eschewed, while in the latter the two ruling parties have mainly used
it as pretence rather than as substantive commitment to change.
Ironically, in both countries, the principal thrust for public
management reform has come from military rulers rather than by
democratically elected governments. In Bangladesh, the militaryturned-civilian regimes of Ziaur Rahman and Hussein Ershad, despite
failings in their political approaches to governance, accomplished
significant changes in the governmental machinery, consolidated the
civil service system, and moderately responded to external pressures
for liberalizing economic policy and management (Zafarullah, 1996a;
1996b). On the other hand, the first military ruler in post-1971
Pakistan was obsessed with transforming the country into a religious
autocracy and resorted to political machinations to appease
fundamentalist and capitalist elements disgruntled with his
predecessor’s socialist inclinations.
MAJOR REFORM EFFORTS
The restoration of civilian rule in 1972 ushered two leaders-Bhutto in Pakistan and Mujib in Bangladesh--who were keen to
debureaucratize the administrative systems. Both leaders were wary
of the past dubious role of the generalist corps in the bureaucracy in
deriding political institutions, and took steps, indubitably guided by
political motivations rather than technical considerations, to enforce
political control and accountability in the civil service system. In
Pakistan, the government took the shorter route to reform by
enforcing changes through executive fiat,(2) while in Bangladesh a
more realistic approach was adopted in terms of establishing bodies
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT357
to prepare comprehensive reform proposals. However, in the former
the outcome was immediate with the near-complete transformation
of bureaucratic structure, while in Bangladesh the comprehensive
reform blueprints (GOB, 1973) hardly produced any positive result.
While in Pakistan bureaucratic resistance to reform was neutralized
or rather given no chance to transpire, in Bangladesh the protracted
nature of the inquiries to assist in planning the changes gave the
higher bureaucracy the time to mobilize its ranks in resisting any
moves aimed at reducing its entrenched status and power in the
governmental system (Zafarullah, 2002). The Bhutto reforms in
Pakistan, however, were reversed under military tutelage as the old
elite corps regained control over the administrative system. Several
years later, a democratic government responded to growing concern
for endemic corruption within the bureaucracy by establishing a
proper accountability enforcing body, but recurrent political
interventions encroached upon its autonomy.
In Bangladesh the post-independence estrangement of the
bureaucracy from the power center recoiled as the Mujib regime
failed to initiate any changes in the face of political and economic
uncertainties and subsequent military governments relied on the
bureaucracy for regime-maintenance. The first military-cum-civilian
regime (1975-81) reorganized the civil service system while the
second military regime put in place a decentralized political and
administrative structure.
In more recent times, especially since the 1980s, the pace of
governance reform in both countries has been both sporadic and
expeditious depending on the areas covered, the policy priorities of
the government in power, and the degree of external pressure for
integrating into the world economic system. From the mid-1980s,
structural adjustment programs (SAP) under the aegis of the World
Bank and the IMF almost became mandatory for aid-recipient
developing nations. One important component of SAP has been
institutional and public management reforms for effectively
responding to the influences of globalization. These reforms have
included denationalization or privatization of public sector
enterprises, outsourcing government functions, deregulating private
sector activities, enhancing institutional and managerial capacity of
public organizations, and expanding government-business relations.
Institution building, necessary to strengthen governance, has
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encompassed several governmental sub-systems such as the civil
service, financial management and public expenditure, and legal and
judicial procedures (World Bank, 2000). Also critical have been issues
such as integrity management, administrative structures, and
decentralization. However, intermittent changes in government in
both countries affected the proper and timely implementation of
institutional and capacity-building reforms. More important were
political commitment and sustained stewardship necessary to effect
change, but these have lacked in vigor or direction, and hence been
disincentives to the reform success. This is where the international
donor community (IDC), particularly the World Bank, stepped in to
assist Pakistan and Bangladesh to design and program the
machinery of reform. In the following sections, the article examines a
few of these reform areas.
IDC INITIATIVES IN REFORM AND GOVERNMENT RESPONSES
Apart from reforms under SAP toward macroeconomic
stabilization and structural rearrangements in both economic and
social sectors, both countries have been under intense pressure from
the World Bank to renew and revitalize their public management
systems. In 1996, the Bank produced its blueprint on reform for
Bangladesh--Government that Works: Reforming the Public Sector
(hereafter, GTWRPS) (World Bank, 1996). Two years later it called for
changes in Pakistan’s administrative structure through a report
entitled A Framework for Civil Service Reform in Pakistan (hereafter,
FCSRP) (World Bank, 1998). Both plans were based on heuristic
methods and had a similar objective--to provide strategies for
comprehensive reform of public sector management and introduce
best practices implemented elsewhere (in both industrialized and
developing countries). However, while the plan for Pakistan was
prepared in response to the Pakistan government’s appeal for
assistance in designing a comprehensive civil service reform program
(World Bank, 1998), in Bangladesh the World Bank itself took the
initiative after perceiving the unwillingness or rather indifference of
the government to bring about any concerted changes to the
country’s governmental system (Zafarullah, 1996b). Inputs from civil
society groups and parts of the governmental machinery,
nonetheless, contributed to the framing of the plan. This section
examines some significant proposals relating to public management
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT359
reform contained in these two documents as well as other IDC
initiatives and the responses of the governments in the two countries.
The two reports identified several problems pertaining to the
respective governmental systems. The government in Bangladesh,
according to GTWRPS, was too pervasive and centralized; its officials
were overly bureaucratic and discretionary; the system was
preoccupied with process and therefore ineffective and wasteful;
public servants were unaccountable and unresponsive; and citizens
tended to evade coercive and corrupt public organizations (World
Bank, 1996).(3) The country’s development was encumbered “due to
the weak implementation capacity and the inefficiencies of public
institutions, the government’s inability to plan and manage key
reforms, and its predilection to manage economic activities at the
micro-level” (World Bank, 1996, p. i). This corroborated earlier views
on the governmental machinery and its performance (see UNDP,
1993).
The Pakistan situation reflected similarities. The FCSRP
maintained that the bureaucracy “has been unable to cope with its
increased responsibilities” engendered by the continued expansion of
the role of the state. It was “ill-equipped to assume new and more
complex roles” for accomplishing the goals of development because
of lingering colonial administrative traditions that bureaucrats
adhered to. The civil service system was “closed, hierarchical,
ostensibly rules-based, and compartmentalized … held together by
the glue of centralized management and personal relationships within
elite generalist and subordinate specialist cadres” (World Bank,
1998, p. 1).
For Bangladesh, the World Bank proposed certain coordinated
initiatives that would: redefine the boundaries of the public sector by
rationalizing its dimensions and widening the space for the private
sector, nongovernmental organizations, and local government bodies;
make public organizations more accountable to people’s
representatives and responsive to citizens’ demand; improve
interaction between the government and citizens by simplifying rules,
regulations, and processes; enhance transparency of governmental
operations, decision making, and policy implementation processes;
and infuse professionalism and tenets of ethical conduct in the civil
service (World Bank, 1996).
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Even though the FCSRP mainly focused on limited aspects of civil
service management in Pakistan, it also covered other significant
issues like accountability, corruption, devolution, and the nexus
between a sound administrative setup and a productive development
policy cycle. The World Bank informed by neo-liberal ideas, articulated
the rationale for smaller government apparatus in tune with the
changing role of the state in a globalized market-oriented system. The
public sector required trimming, and the government liabilities
overburdening the public purse called for mitigation. Small and
effective government not only entailed the privatization of public
sector enterprises, but also rightsizing the civil service and insulating
it from wanton political influence. The FCSRP resonated the
government’s “Pakistan 2010 Vision Statement” in 1998, which
underscored “a new government, small but effective, decentralized,
responsible, customer-oriented, and managed professionally” (cited
in World Bank, 1998, p. 5).
Redefining the Role of the State
Redefinition of the role of the state for Pakistan and Bangladesh
has meant a paradigm shift in governance. Apart from making the
governments slender by shedding their several functions or sharing
them with the non-government sectors, by retrenching superfluous
employees, and by cutting back public expenditure, the state’s overcentralized character required substantial modification. As an
attribute of democracy, decentralization has been espoused as a
strategy for effective governance from social, political, economic, and
administrative standpoints. Political and economic devolution has the
facility to create an effective nexus between the state and citizens
and a win-win situation for all stakeholders in governance, including
the government, civil society, and the private sector. In both Pakistan
and Bangladesh, the focus has been to relieve the national
government from performing functions that non-government
organizations (NGOs) and the private sector could more efficiently
undertake. The GTWRPS argued that such off-loading or hiving-off of
tasks would “broaden and clear the territory in which the private
sector . . . can grow and prosper. It will have cut away at the thicket
of regulations, sparing only those which are essential for the
protection of the public interest and the promotion of equitable and
productive business activity” (World Bank, 1996, p. xxiv).
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT361
As a facilitator rather than a regulator of social and economic
activities, the governments of these two countries could foster better
government-business relations, encourage entrepreneurship in small
and medium-scale businesses, and attract overseas investment in
core economic sectors. Expanded business activities in a deregulated
or less regulated environment would boost employment opportunities
in the private and non-government arenas and ease the burden on
the public sector. Yet, with the state still expected to play a significant
role in society, particular areas of the economy would require “a
certain minimum, yet effective, degree of government regulation”
(World Bank, 1998, p. 5). To offset the past counter-productive
nature of the regulatory mechanisms in Pakistan, the government
there created independent regulatory bodies for several sectors such
as National Electric Power Regulatory Authority to implement power
sector regulation under a special statute.
The World Bank report on Bangladesh challenged the
interventionist role of the state and the encroachment of the
government into “purely private territory” (World Bank, 1996, p. 20).
It recommended the closing down of public agencies that had
outlived their usefulness or lost their relevance, divestment of certain
public functions to the private sector or NGOs for efficient delivery,
corporatization of public sector organizations for better performance,
and separation of policy making tasks from their implementation and
administration (World Bank, 1996).
Deregulation, Privatization and Corporatization
Deregulation or judicious regulation of public sector operations
can ensure minimal state intervention in social and economic affairs,
whereas denationalization or privatization, and even corporatization
can further dilute governmental density, delimit state compass, and
ease the pressure on the public coffer. The two reports echoed this
view and pushed for reversing the policies that sustained sick
enterprises or unproductive operations in the public sector. For
Bangladesh, the World Bank favored two options: (a) privatization or
total closure of enterprises that operated in competitive market
situations and where privately produced products were accessible by
consumers; and (b) corporatization of development-oriented and
utility/service agencies (operating as monopolies in non-contestable
markets) in order to make them operate based on market principles
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like private commercial enterprises (World Bank, 1996). In a similar
vein, the World Bank advised the government of Pakistan to “exit
from departmental and other non-commercial activities that [were] no
longer necessary or [could] be effectively handled by the private
sector” (World Bank, 1998, p. 5).(4)
Both countries have embarked on the path to creating free
market economies to promote private sector development and
attracting foreign direct investment. Deregulation has therefore been
high on their reform agenda. In Pakistan, the Committee on Reforms
in Regulatory Legal and Policy Environment sought to “map out a
comprehensive regulatory program and implementation steps needed
to get rid of irritants and further free up the economy and to improve
investment climate in Pakistan by lowering costs of doing business
and enhancing export competitiveness” (GOP, 2003, p. 40). The
government has articulated its commitment to confine its role to
“policy formulation, regulation and facilitation, to enable the private
sector to make investment decisions and to inculcate efficiency and
competitiveness” (GOP, 2003, p. 41). In reality though, it has only
partially succeeded.
The privatization process in Pakistan has achieved some
breakthrough, while in Bangladesh it has been moving at a very slow
pace. In the former, a privatization law(5) has been put in place and
the Privatization Commission has been actively engaged in the sale of
public enterprises. Operational efficiency and economies of scale
have been achieved by privatizing state-owned enterprises (World
Bank, 2003). The current favorable regulatory framework with
relatively fewer bureaucratic bottlenecks as well as transparency and
certainty in the decision making process have bolstered prospective
investors and entrepreneurs. However, global economic and regional
political factors have had a delaying effect on privatization.
The Privatization Commission in Bangladesh has been
operational since 1993 and has been accorded a high profile in the
governmental structure. A broad policy and detailed procedures
regulate the privatization of state enterprises in 13 sectors, but
despite repeated notifications and tenders for selling them or offloading their shares, the response from potential buyers or investors
has been lukewarm. The last few years of the 20th century saw a
sharp deceleration in the pace of privatization (Ahmed, 2000).
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT363
The absence of transparency and predictability in the decision
making process in government and the lethargic attitude of the
Privatization Commission have eroded investors’ confidence and
have impeded the sale of state assets in Bangladesh. The fortitude
and commitment exhibited by the current government in closing down
the largest jute mill in Asia have not been evident in its actions on
similar ailing public sector units.
Corporatization of public sector organizations has not really taken
off in either country despite IDC entreaties to overhaul their
management and operations based on business principles.
Notwithstanding the declared governmental strategy in Pakistan to
improve operational efficiency, enhance managerial accountability,
and ensure financial viability, reforms in only a few public sector
bodies (especially in the power development and distribution sectors)
were attempted, but the intended outcome has not been achieved.
The Railways Department, though, has been a relatively successful
case at restructuring (World Bank, 2001a). Corporatization or
commercialization of public sector bodies in Bangladesh has been
attempted sporadically and achieved only limited success wherever it
has been introduced (World Bank, 1996).(6)
Public Integrity Management
In recent years, corruption, transparency, and accountability have
taken on new meanings, that is, they have been widely debated,
analyzed, and employed in recognizing their relevance in sound
governance. Corrupt exchanges in public life, particularly in the
government bureaucracy, have proliferated, raising concern about
their implications for administrative performance and delivery of
service to the citizens. Corruption accompanied by misuse and
mismanagement of resources and dereliction of duty and
responsibility by public servants can create debilitating effect on the
economy and organizational efficiency, cause social dislocations and
public distrust in government intentions, and lower the image of the
civil service. Thus, managing public integrity has become an
important dimension of sound governance, and it is recurrently
espoused by the IDC.
Focusing on Bangladesh, the GTWRPS identified the following: an
extensive regulatory regime that “provides a fertile ground for rent
seeking”, the lack of transparency in government that raises
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questions about the decision making process, the pervasive influence
of powerful business interests, insufficient compensation for public
employees, and flaws in the mechanisms for disciplining aberrant
behavior in the bureaucracy (World Bank, 1996). The existing anticorruption body has been a failure in performing its tasks, and the
successive governments have unabashedly used it to unleash
vengeance against political opponents and those insensitive to their
political beliefs. With corruption remaining endemic, the World Bank
proposed the creation of an independent body, protected by law and
endowed with subpoena powers, to combat corruption. To enforce
accountability, it called for increasing the capacity of parliament and
its committees, establishing the constitutionally-mandated
ombudsman, effecting institutional reforms within the office of the
auditor general, and enhancing openness in government (World
Bank, 1996).
The FCSRP noted the Pakistan government’s own perception
about corruption that had engulfed “all three branches of
government… [with] the result that none of [these] acts as a check
upon the malfeasance of the other two”. An official document further
stated:
The power to appoint or reward public officials are used
arbitrarily, public property is handled in a cavalier fashion, the
system ignores (and often rewards) financial corruption and
the misuse of powers, financial institutions have been
burdened with unserviceable loans, public lands have been
doled out in return for political or financial favors, and publicly
controlled institutions are badly managed and respond
neither to citizen needs nor to financial imperatives (quoted in
World Bank, 1998, p. 2).
The Ehtesab (or Accountability) Commission was appointed in late
1996 by the Nawaz Sharif government to control corruption, but a
subsequent move by the executive to reduce its investigating
authority severely curtailed its effectiveness. However, the prime
minister’s Inspection Commission along with the Ombudsman
addressed accountability and efficiency issues and acted in response
to citizen complaints (World Bank, 1998). In spite of some positive
initiatives until 1998 to improve accountability instruments, external
accountability to the public remained restricted and age-old
perplexities continued to unsettle the relationship between the
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT365
political executive and the bureaucracy (World Bank, 1998). The
World Bank recommended several new measures to supplement
ongoing initiatives. These measures were: increasing the flow of
information to the public, improving citizen access to public offices,
developing the system for data compilation and dissemination,
adopting realistic performance indicators, and enhancing financial
reporting and auditing (World Bank, 1998).
The so-called independent anti-corruption agencies in either
country have been ineffective. The National Accountability Bureau
(NAB) in Pakistan and the Bureau of Anti-Corruption (BAC) and its
successor, the Anti-Corruption Commission (ACC) in Bangladesh serve
only a limited purpose in combating corruption in government. NAB is
under the direct control of the head of government and thus has not
been totally autonomous from government/partisan control. Until the
military takeover in Pakistan in 1999, the political government
abused the NAB’s forerunner, whereas in Bangladesh the BAC was
used for a long time to harass political opponents and the agency
itself was corruption-ridden, requiring a complete overhaul (Zafarullah
& Siddiquee, 2001). On paper at least, the NAB has a wider role than
the ACC in curbing corruption in government, particularly the financial
sector. Its tasks and responsibilities are clearly set out and its
organizational structure and processes well-defined (GOP, 1999).
The demand for an independent anti-graft body in Bangladesh
persisted for decades and after several failed promises by past
governments, the creation of such an institution – the ACC -- was
approved by parliament. It has been clothed with the power to take
action against ministers and government officials on charges of
corruption. However, even from a notional standpoint, this body,
which subsumed the BAC, has been deprived from any form of
autonomy that such a body requires and is beleaguered by
organizational problems and other constraints.
Public Financial Management
The reform of public financial management (PFM) has been a
continuing process in attaining sound governance standards in
developing countries. Managing public revenue and expenditure
funds in an efficient, appropriate, and transparent manner has
become a hallmark of good financial management. The PFM reforms
target effective outcome by rationalizing the public sector budgeting
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process, linking resource allocation and performance management at
the meso and micro levels, and interfacing budgeting procedures with
strategic planning methods (Bouckaert & Pollitt, 1999). Financial
sector reforms have been an ongoing process in both countries since
the 1980s mainly under the aegis of the World Bank, the IMF, and
the Asian Development Bank. The PFM reforms, however, have been
a relatively recent phenomenon.
In its assessment of financial accountability in Pakistan, the
World Bank identified weaknesses in financial management and gaps
in the accountability arrangements due to flaws in financial reporting
and internal controls, and located specific areas requiring intensive
attention. The proper management of public expenditure is tied with
prudent allocation of resources, choice of policies and priorities,
sound implementation, efficient service delivery, sophisticated
controls over financial operations, enhanced technical skills, and
appropriate managerial infrastructure, all of which the government
needs to address. It is imperative to strengthen the financial reporting
mechanism to execute budget proposals efficiently, introduce
performance auditing in the public sector, and enhance legislative
oversight of financial procedures (World Bank, 2003).
The IMF’s “Accountable Fiscal Management Framework” and the
World Bank’s “Project for Improvement in Fiscal Reporting and
Auditing” have worked in tandem to shape the reforms in Pakistan.
Fiscal monitoring committees with the function of superintending
financial reporting have been established at both the federal and
provincial levels in Pakistan, and fiscal controls have been tightened.
Legislative oversight has been somewhat enforced through an ad hoc
public accounts committee (PAC) while the task of approving large
public infrastructure projects has been thrust back to the Planning
Commission. The government accounting system has been
remodeled and the periodic reconciliation of federal budgetary
accounts is gradually becoming a norm. The quick processing and
dissemination of financial information is gaining ground with the use
of the Internet by the Finance Ministry, but freedom of information
legislation is yet to be finalized (World Bank, 2001b). Accounting and
auditing functions have been separated under a new “Chart of
Accounts,” which will also help ‘modernize’ budget presentation.
Financial accountability has been ameliorated with timely submission
of annual audit reports to the PAC, and the review of departmental
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT367
accounts is done by special committees (World Bank, 2002d). The
public monitoring of budget implementation has been on the cards
for a while, and the government’s plan to set up fiscal monitoring
committees at the federal and provincial levels will further raise the
extent of expenditure management.
In the early 1990s, the UNDP and the British Overseas
Development Agency (ODA) catalogued drawbacks in Bangladesh’s
financial management system, and recommended the adoption of a
results-oriented process that would apply performance criteria
throughout the governmental machinery and ensure transparency
and accountability in the budget process.(7) The World Bank’s
GTWRPS confirmed the weaknesses and prescribed a robust audit
system that would enforce rigorous transparency and accountability
principles and link budgeting to outcomes (World Bank, 1996).
However, the government has been slow in responding to these
prescriptions. Incrementalism still characterizes the public budgeting
process, which remains stereotypical and is devoid of any strategic
framework. Goal-ambiguity, undefined responsibility, fiscal
indiscipline, weak political oversight, and political meddling at all
levels impair budget implementation (ADB, 2002). Nonetheless, the
RIBEC project(8) has been instrumental in carrying out several
changes in financial management. These include, among others,
establishment of financial management units in several ministries,
replacement of the old classification system of accounts and
budgeting by a new digit-code system, electronic processing of
accounts, and networking of all principal and regional accounts
offices (CAG, 2001). The Public Expenditure Review Commission set
up “to examine the public expenditure patterns and trends and to
recommend efficient and effective allocation of public resources and
their utilization” (GOB, 2002, p. 11), has exposed financial
irregularities and the government’s extravagance and wastage in
unproductive matters.
Public Procurement Management
Directly relevant to the notion of accountability is sound public
procurement. In many developing countries public procurement rules
are either deficient or inconsistent, or they are unevenly applied. A
flawed regulatory environment, political influence, and errant
bureaucratic discretion can also affect proper procurement in the
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public sector. Yet, a sound procurement regime is essential to ensure
transparency, maintain accountability standards, and prevent public
sector corruption.
The public sector procurement performance has been poor in
Bangladesh despite the practices being influenced by IDC guidelines.
The World bank has identified certain unacceptable features of the
procurement system: poor advertisement, short bidding period, poor
specifications, nondisclosure of selection criteria, award of contract
by lottery, one-sided contract documents, negotiation with all bidders,
re-bidding without adequate grounds, corruption and outside
influence, and other irregularities (World Bank, 2002b).
The lack of a sound legal framework governing public sector
procurement has generated, among other things, “proliferation of
diverse rules and procedures among various agencies, protracted
bureaucratic procedures allowing multi-point rent seeking, inordinate
delays in completing the procurement process and ineffective
contract administration; and absence of mechanisms for ensuring
transparency and accountability in public procurement” (World Bank,
2002c, p. 2). Based on the World Bank’s recommendation, a Central
Procurement Technical Unit responsible for carrying out procurement
reforms has been created by the government, but its performance
has been constrained by political indifference and lack of
bureaucratic support. However, the need for a corpus of procurement
rules and procedures for the entire administrative machinery has
become imperative. The devolution of procurement powers to
government departments and autonomous bodies would hasten the
process, the training of procurement staff in techniques and methods
would have a positive bearing on efficiency, and the introduction of a
code of ethical practices would raise performance standards (World
Bank, 2002c).
Unlike Bangladesh, Pakistan has formalized its public
procurement system by establishing the Public Procurement
Regulatory Authority (PPRA) backed by wide-ranging statutory powers,
including the monitoring of the application of laws and regulations
relating to procurement (GOP, 2002). Its board, however, is
dominated by bureaucrats, and even the three non-government
members are also nominated by the government. How effective and
impartial the body would be without any elective representation is
open to conjecture. However, the commitment of the government to
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT369
improve procurement practices in some critical sectors (e.g.,
education) has been laudable (World Bank, 2001a). The PPRA has
made significant strides in redesigning transparent procurement
procedures to “promote fair competition and deter corrupt[ion]” in the
public sector (ADB/OECD, 2003, p. 13).
Civil Service Management
The quest for efficient and effective government has generally
focused on establishing best practices in managing the civil service,
some of which the preceding sections have covered. Apart from the
questions of accountability and performance, issues relating to civil
service structure, personnel management, inter-cadre conflicts, and
politicization have become prominent and intensely debated and
scrutinized.
The FCSRP reported mainly on structural and pecuniary aspects
in the civil service, and related these to the overall position of the
government on larger administrative issues. Thus, it focused on
staffing matters such as adjusting the size of public employment
through retrenchment or redeployment, streamlining recruitment
procedures, eliminating ad hoc and contractual appointments,
improving wage bill management, and adopting an integrated
management on personnel expenditure (World Bank, 1998). In
addition, compensation reform was a major highlight of the FCSRP. It
argued for incorporating most allowances offered to civil servants into
the basic pay, linking annual increments to performance, removing
the system of “move over,”(9) factorizing inflation when reviewing
increments, and “enhancing the usefulness of pensions as personnel
management tools” (World Bank, 1998, pp. 33-38).
The Pakistan government, however, went beyond these
recommendations in reforming its civil service. The merit principle
has been reinforced as the principal recruitment criterion with a
strengthened and autonomous Federal Public Service Commission
taking on the responsibility of both selecting mid-level officers and
higher professionals and overseeing the promotions process in the
civil service. The training system has been rejuvenated by
incorporating a tighter selection process based on examinations “to
ensure quality of high grade staff.” The new pay scales that reflected
the current consumer purchasing capacity were introduced, but these
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allegedly increased the disparity between the highest and lowest
scales (World Bank, 2004).
The World Bank has supported the creation of a National
Executive Service (NES) to encourage improved performance and
skills enhancement by creating opportunities for training and higher
education. Eligibility for entry would be factored by merit and
competence. Sharp pay increases would also create more incentives
for civil servants to perform while removing the mismatch between
skills and rewards (World Bank, 2004). While there is some merit in
having an apex civil service such as the NES, the government should
take lessons from the past on the usefulness of an elite corps within
the governmental structure vis-à-vis the occupational groups in the
regular civil service. Perhaps, the World Bank, in line with similar
schemes in the advanced democracies, would like to see a motley
group of meritorious and accomplished people to advise the
government on policy matters.
The failure of public administration reform in Bangladesh has
mainly been due to the internecine political conflict raging in the
country since the restoration of democracy. Either of the two parties
in power was or is unwilling to acknowledge, let alone accept, the
reform plans designed during the other’s tenure. Thus, the Awami
League ignored the report of the Administrative Reorganization
Committee appointed by the Bangladesh Nationalist Party
government in 1993, while the latter threw into oblivion the
recommendations of the Public Administration Reform Commission
appointed by its adversary (Zafarullah, 2002).
The GTWRPS was critical of the civil service recruitment policy
that supported a centralized and closed entry system and a selection
process that was inadequate in matching pre-entry educational
background with skills required of a cadre or position. The promotion
system circumscribes the reward of merit and good performance,
because opportunities for upward mobility are unequal between
generalists and professional officers. The politicization of promotion
process and a disguised protocol favoring either particular cadre
personnel or ruling party sympathizers in the civil service, has been a
major cause of inter-cadre or inter-personal friction. The GTWRPS
proposed several basic reforms to rectify the morass in civil service
management, such as establishing a “more pro-active lateral entry
policy” and a specialized senior staffing pool--similar to the senior
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT371
services pool practiced in the late 1970s and early 1980s and the
proposed NES in Pakistan (Khan and Zafarullah, 1982)--as well as
employing more people on contracts, decentralizing recruitment,
depoliticizing the promotion process and linking it to performance,
rotating jobs more frequently, removing gender gap, enlarging training
programs, managing staff rationalization and redundancies, and
improving public service values (World Bank, 1996).
In the civil service systems of the two countries, one notable
feature is the strictly vertically oriented functional cadres fomenting
distinctively inherent unease with rank and status. This untenable
situation is an inherited British administrative tradition that has
outlived its significance in the current age. The rank-in-corps
classification pattern, a derivative of the colonial era when rank and
status were accorded paramount importance in society, has survived
albeit with some traces of egalitarianism. The craving for more power
within the system, especially by generalist bureaucrats, has
segregated the civil service into mini-bureaucracies, each advancing
its parochial interests (Kennedy, 1983; Zafarullah, Khan & Rahman,
2001).
In both Pakistan and Bangladesh, the reform of civil service
management has received less priority than other areas in
governance. However, some positive reforms have been implemented
in Pakistan, while the democratic governments in Bangladesh have
been rather passive in tackling bureaucratic problems. Politicization
has gripped the Bangladesh civil service system, and bureaucratic
resistance has thwarted moves towards rationalization. The
generalists as a powerful group have always displayed a dislike for
reform and change, and have always been successful in prevailing
over a disinterested political executive.
CONCLUSION
The two South Asian countries, Pakistan and Bangladesh, face
daunting challenges in achieving the goals of development. Both
counties are placed in a lower stratum of the Human Development
Index as they struggle to grapple with social and economic problems.
Neo-liberal policies have been thrust upon by the international aid
agencies often without paying attention to the countries’ traditions
and value systems and the capacity of governments to effectively
implement them without disrupting existing social and economic
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relationships. However, being on the receiving end of external aid (in
the form of grants and/or loans), both countries have to, even if
reluctantly, pursue these policies. On the other hand, the influence of
economic rationalism and globalization has forced the governments
to adopt decisions in line with the global and regional trends and
integrate themselves with the world economic system. Thus, both
countries have had to reshape their public management systems to
respond to both external demands for political and economic
liberalization and domestic needs for socioeconomic development
and better services to citizens.
Pakistan has adopted a much more coherent approach in tackling
the governance problems. The commitment of the military regime to
introduce reforms has been evident from the beginning of its
takeover. It has targeted some key areas in governance, such as the
public financial management system, decentralization and local
governance, civil service management, delivery of basic services,
commercialization of state enterprises, deregulation and
privatization, and public integrity management. This commitment is
not trapped at the level of rhetoric, rather concerted actions have
been taken to implement the changes, and the results have been
generally positive.
The reforms in public management in Bangladesh have been
slack and tardy with little political commitment and support. Both
ruling parties, since democratization, have been long on rhetoric but
short on action, and the continuing political strife between them has
been a drag on some of the reforms attempted. Unlike the military
government in Pakistan, neither of the two parties in power in
Bangladesh has been able to present any concrete proposals for
governance reform. There is no comprehensive strategy linking all
areas of reform and integrating them toward a holistic objective. This
has resulted in disjunctive or partial achievement of some of the
efforts.
It is crucial for both Bangladesh and Pakistan to draw lessons
from other developing nations such as Singapore, Malaysia, South
Korea, and Taiwan, which have successfully implemented state-ofthe-art structures and techniques in public management, and to take
cues from IDC plans and recommendations that would best suit the
needs of the two countries. Good governance cannot be assumed as
an ultimate end; rather its best tenets should be adapted to create a
SHAPING PUBLIC MANAGEMENT FOR GOVERNANCE AND DEVELOPMENT373
government system sensitive to the needs of society. The state may
have rolled back in advanced nations, but developing countries such
as Pakistan and Bangladesh cannot yet afford to delink the state
from its time-honored role as the basic provider of social and
economic services and in protecting citizens from the scourges of
poverty. The state, therefore, needs a robust, efficient, transparent,
and accountable public management system to accomplish its
purposes.
NOTES
1. For theoretical discussion on political culture, see Rosenbaum
(1975) and Kamrava (1993).
2. The Bhutto reforms, inter alia, replaced cadres by occupational
groups, discarded reservation of key positions for members of the
elite cadre, and framed a uniform compensation system (See
Kennedy, 1987, p. 54).
3. The police and customs departments are examples of such
organizations, and the general public tends to keep away from
them due to fear of being unnecessarily harassed. Other
examples of organizations which place pressure on clients for
bribes for services are the nationalized banks, public hospitals,
and public utilities.
4. This involved contracting out to the private sector certain public
welfare activities such as education, health, housing, sanitation,
and so forth.
5. The Privatization Commission Ordinance provides legal cover to
challenges, comforts investors, assures transparency in sale
process, and mandates distribution of proceeds.
6. Several public agencies in Bangladesh, including the Building and
Planning Design Unit of the Ministry of Health, the Rural Electric
Society, and the Local Government Engineering Department, have
exhibited improved performance by incorporating performancebased accountability mechanisms, regular monitoring of
activities, improving principal-agent relationship, and introducing
performance incentives schemes.
7. The UNDP produced a comprehensive report on Bangladesh’s
public administrative system and recommended several
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consolidation and reform measures to improve financial
management. The British ODA--now the Department for
International Development (DFID)--made similar recommendations (See Zafarullah, 2002, pp. 59-60).
8. The “Reforms in Budgeting and Expenditure Control” (RIBEC)
project of the Finance Division is financed by the British DFID.
9. Under this system, a civil servant reaching the top of a pay scale
and being there for over two years is automatically moved over to
the lowest point of the next higher scale (See World Bank, 1998).
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