The Public Sector Performance Conundrum

Quality provision of public goods is an important determinant of economic growth. The public sector is criticized for host of ills including red-tape. So, the solution offered by the economists is to keep the size of the public sector small to promote growth. The historical evidence, however, shows that the footprint of the public sector has increased as time went by. Contrary to Hayek’s apprehensions, the role of state, quality of public sector delivery, and freedoms of the people increased simultaneously in the developed countries. The issue in Pakistan is that the public service delivery is not rule-based having negative consequences for the state and the society in the form of clientelism and patronage. The question why the public sector is slow and inefficient in public service delivery is analyzed in detail. The perception that public sector employees are lowly paid is falsified in the light of data of public sector wage premium (PSWP). So low wages are ruled out as a reason for the low performance of the civil servants. Training failure, colonial structure, lack of accountability and professionalism, and politicization are discussed as the real culprits. Need of a developmental bureaucracy on the pattern of the one in Taiwan, South Korea, and Japan is emphasized to make it contribute to economic growth through better economic planning and preparation of sectoral growth strategies. The public sector organizations of Pakistan are more focused on ‘form’ or what Pritchett calls isomorphic mimicry. Instead, change in the culture of the bureaucracy is required through civil service reforms of fundamental nature. Prosociality, integrity, and professionalism are identified as key metrics for the recruitment of public sector employees.