I was reading a book ‘The Quest for a Moral Compass’ by Kenan Malik describing the history of the development of ethics in human society and it mentions Plato’s concept of the hierarchy of political systems. Rule by the enlightened elite tops the chart since the soul of such a system is in the wisdom of its rulers and it is laced with logic. Democracy is nearly at the bottom of the heap since at it’s soul is the appeasement of the baser desires of the majority resulting from the political equality that democracy creates.
Be that as it may, when it comes to operating a modern democracy, what becomes most visible is the spending on social welfare programs. What also strikes us is the large leakages that such spending provokes, with its attendant social moral degradation by corruption, as also poor quality of government services offered to people. So the typical response has been to shrink government activities and enlarge outsourcing. Which is not bad at all but it also involves large public spending. Is there any other nuanced approach possible?
One feature which is prominent in government spendings is the excessive centralisation in the allocation and spending of funds and this factor is often cited as being a facilitator in the ‘leakages’ issue mentioned earlier. So beside the leakage and patronage based corruption of wealth redistribution schemes, is there also deprivation to the society, of other services like good policing, due to this centralisation?
Let us examine this. I am currently posted in a state government owned PSU. It is an autonomous organization with the ability to raise revenue as well as spend funds under the overall directions of its Board of Directors(all of whom, by the way, are government appointees). I see the effects of the easier availability of funds and the lesser constraints on the ability to spend, having a big impact on services that are offered to people. Granted that there may be better efficiencies on the same services that this PSU offers, if they were given by a private firm with profit motive. But what goes out from this government PSU is great, within the constraints of government service conditions. I think one of the main reasons for this output is the efficiency and flexibility of expenditure decision making. If a department within this organization has a good idea for better services, it is taken to the Board for approval and expenditure. Such approval leads immediately to next steps for implementation of the project. This, typically creates a positive loop encouraging employees to ideate, plan and also implement projects through spending.
Now consider what happens in a typical government department, say police. Annual needs of the dept are projected to the government at the beginning of the year and the dept is allocated a spending budget. The spending is further controlled in a centralised fashion, both by the police department and the government. This results in uncertainties and remoteness for police units to access the resources for delivering the public services of the department. The remoteness of the centralised controls on spending also chain any flexibility in spending on evolving needs. The department continuously suffers from inadequate resources, as a result. Also, the available finances get spent in a generalised fashion rather than getting fine tuned to local needs, resulting in more inefficiencies. Like say, there may be need for a bigger monthly fuel quota per vehicle in a police station whose areas can be accessed only through circuitous mountain roads, but since the quota is fixed centrally, and funds so distributed, this police station can have a genuine problem in meeting its service requirements on adequate mobile patrolling for crime control. Or there is an upsurge of crime in one district and the district SP may have no budget for public education since ‘ public education for crime control’ is not deemed important by the centralised funds controller. How could better policing services be provided to the people in these circumstances? The result is that everyone in the department feels the lack of resourcing, and it kills any creativity or initiative the officers might have to deliver better services, and it also opens an avenue for corruption for those inclined towards it. But most importantly, in an unseen way, it deprives people at large of the better police services that may have been possible if expenditure decisions had been decentralised down the line right upto the police station.
Democracy cannot only mean free elections. It must also mean translation of the will of the people to get better public services for themselves through electing their representatives to do that. Centralization of powers and funds then become a roadblock to achieve that. Making government organizations more effective through more and more decentralisation of powers and funds, could possibly make us more truly democratic than we currently are.