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Why outcomes and not government spending are important

July 09, 2009 13:51 IST

One does not grudge Pranab Mukherjee his half-suppressed smile and the body language that betrayed pride when he read the paragraph in his Budget statement about the government expenditure having now touched an all-time high of 10.21 trillion rupees. After all, he was going to deal with the biggest ever treasury in India's history. But that should make us all expect that this money is spent efficiently. In India, government money is never efficiently spent.

Rajiv Gandhi had made a public confession that out of every rupee spent by government, only 16 paise reached the intended beneficiary. The rest was accounted for by administrative costs and leakages. The former could certainly be certainly managed better. The latter is a cause of perennial worry of the beneficiaries, not the government. It normally does not give a tinker's damn about it. But given the realities of both the issue and the size of funds, something should be done to change the situation.

Something done, but…

I would admit that something is actually being done about it but it seems grossly inadequate. Take the Comptroller and Auditor General of India which puts up its reports on its website and points that its regulatory audits have shown, as in 2006-07 that every rupee spent on the scrutiny led to recovery of Rs 27 of misspent funds. There is another side to the CAG -- the performance audit. In the year cited, it had dealt with 400 odd topics across the country.

It showed up such instances as continuing encroachments on the Vishwabharati University campus, the one founded by Rabindranath Tagore. It showed up, to cite another instance, how despite the Supreme Court's order, the Mumbai Port Trust did not monitor ship-breaking activity with regard to environmental issues and how it did not even have an environment management plan for the entire port it operated. These are good slivers of carelessness. 

The CAG presents its reports to Parliament and state legislatures annually and it never, if ever, is questioned. We are seldom made aware of the action taken by the respective government because the media is quite dismissive of the CAG reports, apparently because of the view that these things happen in a country of our size and complexity and maladministration is a reality. I beg to differ: if you accept careless, reckless maladministration which include widespread bribery, then we are accepting misgovernance from those we elected.

Not enough

Let me buttress my contention by citing the work done by the Ministry of Statistics and Programme Implementation. On its website, it regularly puts up reports on the implementation of the Twenty Point Programme -- not the one of Indira Gandhi vintage but the TPP in vogue since 2006. It says that under the National Rural Employment Guarantee Act, 7.04 crore job cards were provided between April 08 and February 2009 and that 174.02 crore man days of work was created, disbursing a wage of Rs 15,470.48 crore.

Such latest information is remarkable by government standards, which has no sense of timelines. But the entire report which deals with the 20 points and 66 items does not make a mention of the qualitative aspect of the outcomes. Were the job cards given on time and on demand? What were the reasons if any and were all who sought get them? What about the wages -- were they timely too and if there were lags, how big were they? The MOSPI which grades the states 'very good' for attaining a 90 per cent target (!) and 'good' for between 80 and 90 per cent and "poor' for anything below 80 per cent just sticks to the physical and fiscal yardstick, not outcomes.

Qualitative assessment missing

Take the MOSPI's evaluation of enforcement of minimum wages, including for farm labour. The statistics are as follows:

Number of Inspections made 1,83,657

Number of Irregularities detected 40,480

Number of Irregularities rectified 33,552

Number of Claims filed 4,516

Number of Claims settled 4,738

Number of Prosecution cases pending 13,085

Number of Prosecution cases filed 90

Number of Prosecution cases decided 205

There is no mention of why prosecution cases are pending and for how long. And why despite 40,480 detected cases of irregularities, only 90 cases were filed for prosecution. Unless these are known remedies cannot be found but that does not seem to occur to the government which is obsessed with its processes, fiscal and physical targets and never the outcomes. Believe me, these are important elements to promote good governance. And here is why:

Eternal mischief

In a career spanning 36 years, I have reported during India Gandhi's time that the same buffalo to be given away to a poor man was taken from public function to public function and handed over to several beneficiaries. There have been instances of drought relief work being carried out and money shown as spent on jungle clearing in an area which scarcely had any scrub on it worth mentioning. Such are the nefarious mischief mongering capability of the official machinery and CAG and MOSPI do not do, despite perhaps their good intentions, enough to expose this. Of course, the CAG's purpose is, as it says on the website, "to examine the economy, efficiency and effectiveness realised in the use of government resources".

I do not intend to run down the CAG but think it could do more. The CAG needs to go about its stated goal on a wider scale. Any irregularity must be immediately brought to the people's attention without having to wait, as required under the law, via the Parliament and legislature. I shall explain this as we go along for "effectiveness of use of government resources" is the key, it is a measure of outcomes.

Outcomes alone matter. It is the outcomes that are important to know if the money was spent wisely and efficiently and this is what neither the CAG nor MOSPI do not seem to do very well though the MOSPI does not have a wider mandate to poke anywhere like the CAG could do. Despite the CAG's reach and skills, there is this serious shortcoming which needs to be corrected. Towards that end, I would like to suggest an Office of Outcomes at every tier -- New Delhi to districts which have not just government officials but the genuine segment of the civil society, all under the superintendence of eminent persons.

The offices could be mandated to directly put up details of their findings on websites so that there is a people's monitoring of the government schemes which are well intentioned but poorly executed as a rule. The nitty-gritty of why things did not go as planned out to be found out and the correctives suggested. The monitoring and fault-checking has to be not from the dispenser's point of view but by the entitled recipients -- mark it, I see no beneficiaries, what people get is their entitlement, paid for by taxpayers, not largesse doled out by the government; it is only an instrument, a vehicle, no more, no less.

Citizen empowerment

After all, the Right to Information which emboldened harassed citizens to expose governmental wrongdoings has worked well and the results are visible. So effective has it been that some officials have begun to see it as an instrument of harassment of the officialdom which hitherto remained insular. If that could work, the Offices of Outcomes could work as well though it needs to be well thought out and made foolproof. It should not become an instrument for politicians who come in as 'social workers' and then become blackmailers. Some legislative committees had become that in the past.

Now the pie is getting larger. The NREGA alone has increased by one and half a times. More greasy fingers would be itching to dip into that and this is the time when a new mechanism should come into place. After all, the claimed mandate is for the aam aadmi and his interests have to be served well. Will the government, led by a wise man like Manmohan Singh who had the courage to co-opt Nandani Nilekani decide to hear a different drummer and put the government machinery under a continuous, unrelenting scanner? It would be worth the while for the country.

Mahesh Vijapurkar is a Thane-based commentator and former deputy editor, The Hindu.

Mahesh Vijapurkar