President Mahinda Rajapaksa, addressing a seminar on public enterprises and their future, on Tuesday, reaffirmed his antipathy towards privatization of weak State institutions and explained how the Government proposes to get public sector enterprises to operate without being a burden on the Treasury.
He proposes to adopt a carrot-and-stick approach in dealing with these institutions. He said the Government would monitor the performance of these institutions and, at the end of one year, review its progress. The chairmen, boards of directors and employees of institutions that had done well, would be commended, while the authorities would name those that have failed to perform as expected.
At the same seminar, Finance Ministry Secretary Dr. P.B. Jayasundera gave listeners some idea of the state of some of these State institutions. He said that institutions that continue to be burden on the Treasury are, the Postal services, the CGR and the CEB among others. He did not mention the CWE and the CPC. Perhaps, they are now doing well. These are the same institutions that former Finance Minister Dr. Sarath Amunugama described as monsters that gobble up State funds, without providing a satisfactory service to the people.
Efforts were made, even at that time, but to restructure, rather than privatize them. All such attempts were thwarted (mainly by the trade unions). When the previous administration made some attempts to rectify matters - it also asserted that it would not privatizing, although it would take that step, if necessary. The unions, backed by parties of the present Alliance, were up in arms, accusing the Government of pursuing a policy of privatization, under the pretext of restructuring. So, the acute problems of management in those organizations remain unresolved to this day. Dr. Jayasundera, of course, described the reasons for the failure of these institutions. He explained that these were entities that had been subjected to intense politicization, trade unionization and bureaucratization. He also said that past attempts to improve them failed to yield the desired results.
The carrot-and-stick approach is very desirable indeed and it conforms to the norms of democratic practice. This method could even succeed. But its success would depend on certain conditions. The first condition is that politicization, which means filling these institutions with cronies and activists of the ruling party and manipulating their operations to suit their political and selfish ends, has to be stopped forthwith. It is well known that these institutions have been used by past governments, as avenues for providing employment to defeated candidates and other party zealots, who had served the party and were expected to utilize their positions to further their party`s prospects. Their qualifications and suitability were often considered irrelevant, when making appointments. This process, though condemned by all parties, continues to this day.
There is no indication, even today, despite incessant avowals of commitment to the norms of good governance, of a departure from the old practice. Serious inroads are now being made even into the ranks of public service, which had remained impervious to such attempts in the past. It was mainly to overcome this bugbear, which was plaguing all State institutions that, the system of independent commissions was begun. It is this country`s misfortune that even this baby of commissions, born after a long gestation, but without many labour pains ? since all parties supported it - is now being crippled.
The next condition required for efficient functioning of State institutions is the establishment of a system of truly independent and democratic trade unions. Most trade unions operating today are appendages of political parties and are keener to promote their party interests than to ensure the well-being of their institutions and the welfare of its members. Some union leaders hold leadership positions in perpetuity, without being elected through democratic processes. The multiplicity of unions that operate in certain government departments, makes a mockery of the whole concept of trade unionism. There are over 50 unions each, in the health and railway departments alone. Therefore, unless and until these conditions are fulfilled, the chances of the present approach succeeding are remote.