In my last column, I suggested that no replacement for the Planning Commission (PC) is needed, and that its functions could be spread among other existing government institutions. What has transpired in the last few days illustrates the problems in India?s governance structures, ones that a ?think tank? will not fix. The main relevant event has been the firing of the head of the Independent Evaluation Office (IEO), which will likely now be wound up, after a short existence. Apparently, the Prime Minister?s Office had been questioning the need for an IEO when an older Programme Evaluation Organisation (PEO) already existed under the PC. Meanwhile, and probably not coincidentally, a committee of government secretaries had recommended strengthening the PEO.
The ironies and absurdities of these developments are obvious. The PEO has been relatively ineffective, and the secretaries who want to strengthen it (and presumably scrap the IEO) may simply want to reassert bureaucratic control. The politicians in the ministries may also be happy to have one less body looking over their shoulders, as they shovel money to purposes and programmes that may or may not be the right ones, or well-designed, or well-implemented. One battle for accountability in government will have been lost.
In a column last year ?Making government work?, (FE, July 26, 2013, goo.gl/YcTmBU), I highlighted some relatively simple structural reforms for bureaucratic decision-making, as well as the importance of pushing untied funds down to the state and local level for spending that might be better subject to accountability through citizens in their role as voters. The demise of the PC still leaves the latter possibility as a strong hope. But killing the IEO leads me to reopen the question of whether a replacement for the PC is needed, and what it should look like. In my view, this discussion has lacked clarity and focus, even from those who have touted replacements.
Start with the value chain of government decision-making. First there is strategic envisioning and goal-setting. Then there is the detailed process of translating the vision and goals in feasible action plans with the right budgets. Third is implementation, and finally there is evaluation of the results of the spending and actions. This may sound like planning, but it is just as descriptive of processes of business strategy. In the Indian government, all four of these steps are currently weak. The possible new think tank, as described by several people, including the former head of the IEO, would tackle the first step, presumably giving the Prime Minister and Cabinet intellectual inputs for exercising authority, which the think tank itself would lack. Interestingly, India has been churning out National Policies on manufacturing, water, education, empowerment of women, urban street vendors, and anything else one can think of. Presumably a strategic think tank would envision issues at a higher level, in a more coordinated and integrated manner.
Setting aside the likelihood of creating a brand new body with the intellectual heft to make a valuable contribution, if one considers the second step, this is something that the line ministries have to do, and the finance ministry has to monitor and coordinate. A think tank might provide starting points and priorities for choosing projects and programmes, formulating them and calculating their financial parameters and social returns, but the work has to be done in the ministries, perhaps with some outsourcing to experts outside government. The third step, implementation, also has to be done by the line ministries, but now they have to oversee efforts that may involve hundreds or thousands of people over whom they have little or no direct control. This is a problem which has nothing to do with whether or not there is a PC or a think tank, but recognising it is important for programme design.
The fourth step, monitoring and evaluation of outcomes, will presumably be done by a strengthened PEO, where one aspect of strengthening is to give the PEO sufficient independence or autonomy. The work of the PEO has to feed back into all the three prior phases of government decision-making, so that implementation and design are improved, and reality checks are provided for grand visions. Perhaps a think tank would also be able to consider the PEO?s outputs in an integrated manner, so that, for example, sanitation, nutrition, health and education are understood as part of an interlocking system for development.
The point of this exercise in deconstruction is to make it clear that (1) a think tank would do only a part of what the PC did, (2) to be effective it would need other steps in the chain to be strengthened, and (3) even then it might run the risk of stretching beyond its capabilities. A final important point is that the possible role of a think tank would not look very much like China?s National Development and Reform Commission (NDRC). Even a cursory review of the NDRC?s goals and its practices suggests that the organisation?s scope is far beyond what a new think tank might do. So in thinking about replacing the PC, China is not the place to look for institutional design.
The author is professor of Economics, University of California, Santa Cruz