Wei Chi: Crisis is opportunity

Apparently in Chinese the word to say crisis is ‘wei-chi’; to express this you need two Chinese characters. When the first character is taken alone it means Crisis, Problem or Danger while the second character alone means Opportunity. Thus, when one says ‘wei-chi’ it is both crisis and opportunity. With so much Chinese influence on us I think it is quite appropriate for us to reflect on how the current situation can be used as an opportunity.

While it is true that ours is more an income problem than an expense management problem, I feel this is a good opportunity to re-engineer the system. It is encouraging the kind of proposals made by the collective of Cabinet secretaries last week. I wish to place the following ideas to be considered along with them.

If we use this opportunity right, we can make our public service one of the best in the world. While we complain of the many shortcomings of the public service it is our large public service that contributed significantly to the overcoming of the COVID threat. There had been a close nexus between effective public sector and the fast recovery from COVID. This is well-described in the book ‘Ten Lessons for a Post-Pandemic World’ by Fareed Zakaria. 

What we need to do is to make our public sector absolutely efficient and smart.

Consolidation 

In order to optimise scarce resources institutions that have similar objectives and those can produce better results through synergy merged into single entities. 

To do this meaningfully a high powered multi-disciplinary team must be appointed with legal, financial, ICT, human resources, and public administration capabilities. But more importantly those individuals must be those capable of thinking out of the box. Their mandate must be to study the various acts governing different institutions, to ascertain similarities of objectives and propose required legislative changes to amalgamate and to divest or even to close.

E.g. Businesses that are better done by the private sector the government can exit i.e. Salusala and Laksala, etc.

If it is strategic to stay in business of trading, then all trading establishments must be merged to form one entity. Sathosa and State Trading Corporation.

All research institutes must be brought under a central authority to ensure proper coordination where resource allocation must be done based on the short to medium term needs of the country. This can avoid duplication of limited resources.

Create centralised support services

Centralise all the support services such as Human Resources, Administrative, Procurement and Finance functions of those clustered entities so they can focus on core delivery function. This model should be tried at least for different institutions under a single ministry. Currently every institution however small it is, will have an, administrative person, a finance person, etc., but these are common services.

Work From Home (WFH) 

Identify functions that can be done remotely in as many organisations as possible and create infrastructure, and work norms for State employees to work from home, take files home, complete and deliver on given deadlines. They will have to be monitored not by the number of days but by the delivery of outputs. This will ease off the pressure on transport, operational costs of offices and the personal costs of employees. There can be some institutions whose work can be done significantly online (i.e. obtaining ISBN numbers by authors) and facilitate online payments and credit card payments. Some institutions can work for less than five days a week without affecting delivery to public.

Remove cash collection completely

Remove all cash collections by all Government institutions for the services they offer. Banks and fintech solutions can collect cash far more effectively. Modernise the postal department also as a cash collector. Wherever possible make cash online and via plastic. This will bring efficiency and reduce corruption as well.

Centralise finance function 

Rather than allowing every Government agency to maintain separate accounts and bank balances, have a centralised system where the Treasury can manage the payments using an efficient ERP system. All payments must be made to bank accounts. 

Large global corporations that run operations in 30-40 countries operate such centralised leger systems. This will help Treasury manage cash flows (I once heard at a conference that Maldives uses such a system but worth checking).

USE ‘SIM’s to target and deliver subsidies

The need to target subsidies is well-articulated by Dr. Harsha De Silva MP. Perhaps with over 100% penetration of mobile phones we can use the SIM to target and deliver differentiated social subsidy schemes. Revisit the need to give books and uniforms to all students irrespective of their economic capacity.

Strengthen the Grama Sevaka office

Strengthen the GS office by converting it to a GS division based Government contact centre by attaching at least one of the newly recruited graduates. His/her job should be act as a facilitator between the citizen and different Government institutions. He or she should, read and explain all the requirements to citizens, certify and upload applications and supporting documents, give clear instructions as to how to approach requirements needed by the Government. This should ease the work of service providers, reduce repetitive visits by the citizen. The GS office should be equipped with internet connections, video conferencing facility and high speed or at least flat bed scanning facility.

Strengthen the postal department as the last leg delivery partner for ecommerce

Allow the post offices to hire three-wheelers so the postman’s delivery area can be increased and what can be carried too will be enhanced. This way they can specialise in delivering pensions and such needs of elderly, thus creating a very powerful user-friendly customer service. Eventually the profits can lead the postman to use their own three-wheelers. POST is the largest distribution network in the country. As mentioned before, strengthen the digital capabilities of the postal system as a cash collector of the Government.

Centralise vehicle ownership 

Rather than allowing every single organisation to own vehicles, re-acquire all the non-strategic vehicles to a central transport service corporation that can be operated as a fully-fledged cab company using an ICT platform such as Uber or PickMe. Pre-authorise the type of vehicle that can be used by different grades of officers and encourage ride shares by giving bonus points. This will cut down waste, improve efficiency and be able to provide better quality vehicles for the officers to travel as well. Because this institution’s core responsibility is vehicle fleet management it will ensure proper maintenance and upkeep of vehicles. This kind of an arrangement will provide valuable data to manage vehicle usage and resource planning.

A platform to use Government spaces

Create a platform such as booking.com where every single meeting room is listed, so they can be used and shared by private as well as public users. This will generate new income to those institutions. There are a large number of fully-equipped auditoriums available within the city of Colombo alone that are underutilised. 

Digitise health system 

Our health system while providing an excellent service for a country of our size there must be significant opportunities to improve efficiency. While the health sector employs some of the best educated professionals why cannot they use a thumbprint attendance system that can automate the entire staff management system, whether it is leave, OT, salary, etc.? There can be many hardware that are underutilised in the health sector such as expensive scanners, etc. and they must be booked via a centralised digital platform so they can be used effectively. Eventually all expensive high-end equipment of the health sector must be outsourced so that the burden of maintenance and procuring lies in the private sector and the Government can pay only for the usage. ‘You do not have to own to use’ is the modern thinking.

All medicine and equipment stocks must be available on a browser-based system so that any hospital can find out the closest hospital that has any item if not available. Thus, the optimum usage can be assured.

Manage by exception

Most of the Government systems are done to protect all extreme possibilities. One case in point is the pension delivery system. Pensioners are supposed to provide a life certificate annually to prove that “I am alive”. This is to avoid any deceased person’s pension being claimed by the respective families. But this must be the exception than the norm. The Government’s thinking seems that all family members of Government pensioners are dishonest, and they will all continue to withdraw the pension after the death of the pensioner. 

Providing the life certificate is OK when the person is healthy but as the person gets older and weak then this becomes difficult and nearly impossible in some cases.

This can be avoided by simply asking one more question when registering a death of a person. i.e. Is the deceased person a Government employee or a pensioner? If the answer is yes, then send a copy of the death certificate with details to the pensions department or the divisional secretariat, rather than having such a cumbersome system of obtaining life certificates. 

There may be many such systems that adds little value.

Set service standards

In the past when Government employees used to sign as your obedient servant any letter sent to an office is acknowledged with a reference number and the expected time of response. This was done by a simple post card. Now Obedient Servant and at Your Service all has got replaced with high sounding designations and most of the time, the citizen is at the mercy of the officer. 

Hence every office should have a system of giving appointments to citizens if they ask for so that there is no waste of time of either party and there must be published and established service standards. Some offices practice these. Acknowledgements can be done by SMS as at Passport office and they should be the benchmark for service standards across all institutions.

Change the criteria for evaluation

In the Government system performance is measured by using the input. It is referred as financial progress. This is perhaps based on the assumption that all activities are well-justified and easiest to measure is the amount of money spent. But sooner we move to a system of outcomes and outputs the rationalisation can happen. In the current system, by the time cash flows are made available to respective organisations it is almost midyear. This is the main reason for non-completion of most projects. There must be a stringent justification process in selecting activities to spend finances which are going to be extremely scarce in time to come. Rather than rewarding for spending there must be recognition for saving allocated funds while achieving set objectives.

Consolidated purchases 

Government is one of the largest customers of goods and services. At least at each ministerial level there must be consolidation when purchasing thus gaining the advantage of economies of scale. In order to get the most competitive pricing there can be a reverse auction – bidding process that can be transparent and for the given technical specifications the lowest cost provider can be given the order.

We cannot any more afford to have the current system where there is room for corruption. Digitisation is the key to eliminate opportunities for corruption.

Innovation 

Identify a few problems, where solving them can have significant national benefit and announce a grant to the winning solution so focused innovations can happen.

Remove regulations so that a level playing field is created for local innovations to supply them to the Government customers; i.e. there are many local solutions to improve the rail gates but because they do not meet the set specifications of imported items the local inventions never get even tried.

Revitalise co-operatives 

With the help of some good marketers help improve the co-operative distribution network and the related co-op system targeting especially the lower middle class and smaller geographic segments. This will ensure the integration of local level supply chains to the co-op system and benefits will flow back to the society.

SOEs 

There is much said about how to manage the SOES from divesting, to partially listing, to restructuring. These must be done without further delay as the taxpayers cannot bare their losses anymore. In the acts with these institutions are established the line minister is given the authority to appoint Chairpersons and Directors. Immediately this provision must be repealed. Instead, the appointment of the board of directors must be done based on merit. All SOEs must be subject to the same high governance standards applicable to listed entities. They must be audited timely and annual reports must be published on time.