A good start to providing visible reforms would be to lubricate inter-institutional functioning. Consider the roles of the RBI, the SEBI and the Department of Economic Affairs. They rarely work in unison and offer isolated segmented interventions
While the time seems to be right for an all-round, re-design of the governance structure, it will take a long time to achieve the desired results. It is a tragedy that the good work done by the Second Administrative Reforms Commission under the chairmanship of Mr Veerappa Moily has not been systematically followed through. Had that been done in time, many of the questions now being put forward by civil society would have been answered long before they were even raised. Perhaps, it is still not too late to set up a committee under the Department of Administrative Reforms and Public Grievances to look at the feasibility of implementing the recommendations made in the Administrative Reforms Commission Report.
The average Indian is essentially patient and reasonable but expects some movement towards ameliorating his condition. However, even that hope when not matched by changes on the ground cannot last long.
A good start to providing visible reforms would be lubricating inter-institutional, inter-departmental and inter-ministerial functioning. It is no secret that even in economic and financial matters, there are multiple agencies at work. Consider the roles of the Reserve Bank of India, the Securities and Exchange Board of India and the Department of Economic Affairs. They rarely work in unison and often offer isolated segmented interventions. This shouldn’t be hard to remedy, if there is political will. It also doesn’t take a genius to recognise that a visible impact in financial policy-making will take place if the three institutions are brought together for creating measurable changes within the economy.
Some time ago there was talk of setting up a super-regulator to address this very issue. The term ‘super-regulator’ was by itself so self-incriminating that no one was willing to push for it. Any intervention which cuts down or trims the operational space of an agency is bound to evoke spontaneous resistance by the affected party. And if the affected party is powerful enough, it will make sure that the proposed course of action gets stymied.
The proper way of managing change is to include all agencies in creating the necessary atmosphere for this change and then subsequently convincing them of the need for the proposed course of action. Of course, in the case of financial reform, bringing together powerful regulators would require considerable effort as well as cohesiveness in their work, policy and personnel.
In other words, it is important to understand the perils of administrative reforms and that one must tread carefully for results to materialise.
While this is not the place to discuss administrative reforms in its myriad forms and multiple incarnations, what must be highlighted is the need to prioritise the areas of action that need better governance. This only the Union Cabinet can do especially since several ministries will be involved, including the Union Ministry of Parliamentary Affairs and the Union Ministry of Personnel, Public Grievances and Pensions, to name just a few.
There is no easy way out of this web. But it is important to flag this as an agenda item for growth and development to have a purposive direction. The contradictions internal to several regulatory processes have in fact arisen out of an extended period of non-reform.
For the sake of further illustration, one can cite the role of the RBI which serves both as a regulator and the ultimate lender. This clearly needs a relook. Of course, it will be too tricky but is still do-able.
To sum up, therefore, a consensus has to be built to collate all the recommendations made so far by various committees, agencies, commissions looking into administrative reforms. Then, there has to be prioritisation of action at the appropriate level of the Government which must see through the reform process with sagacity and statesmanship.