Governance

Be wary of lobbyists

Shubhabrata Bhattacharya analyses the possible move for lateral inductions in public appointments and cautions against the perils of unsavoury lobbying

Be wary of lobbyistsIN order to take the reform process—the Naya Daur (new era) initiated by Narendra Modi—to its next level, it may be imperative that people from a wide range of backgrounds take up public appointments. In order to reflect the rich diversity of our society, it may be necessary to source public appointees from among those who have experience and a better understanding of the mosaic that is India. While sourcing human resource from various fields—private sector, academia, civil society, et cetera—due caution ought to be observed to ensure that unsavoury lobbying does not receive a fillip. The interests of the Indian State must be safeguarded.

The lateral induction of private sector professionals into senior positions in the government, which is speculated as being the anvil, is not a new thought or concept in India. While it is institutionalised in governments abroad, in India the thought process traces its roots to the Estimates Committee of Parliament in the first Lok Sabha (1952-57). In addition to the Indian Administrative Service and the host of other Central services, it was envisaged that an “Indian Commercial and Industrial Service” be set up for manning the economic ministries and public sector industries, which had been assigned “commanding heights” in the Nehruvian scheme of things.

While this did not fructify, the Industrial Policy Resolution of 1956 produced an offshoot—professionally qualified men both from within and outside the realm of government were inducted and recruited into the Industrial Management Pool (IMP) in 1959. Many young professionals who opted for the IMP rose to head public sector organisations as CEOs. IMP was merged into the IAS in 1973 when Mantosh Sondhi was made Secretary Heavy Industry (Sondhi, post-retirement, served as Chairman of the Confederation of Indian Industry—CII. The CII headquarters is named after him: Mantosh Sondhi Centre.)

The Estimates Committee of the third Lok Sabha, in its 52nd report (paragraph 57), lamented that the proposal for the setting up of the Indian Commercial and Industrial Service was “neither conceived nor implemented properly”. It reviewed the IMP and found that the talent which had come in through the UPSC recruitment process was finding it difficult to circumvent the ICS-IAS juggernaut. The performance of the IMP was reviewed by a committee set up under two eminent officers in 1978—Bazle Karim and Dr S Neelamegham. It may be worthwhile to revisit the report of this panel before lateral appointments are thought of. The pitfalls identified in the success of the IMP may provide a roadmap for a successful experiment this time around.

Apart from the IMP experiment, in the early 1970s the Indira Gandhi government tried inducting diverse talent from outside the government. S Mohan Kumaramangalam, a successful barrister with a Communist background, was inducted as Chairman of the Indian Airlines Corporation. Modernisation of IAC and induction of Boeing 737 aircraft took place in his tenure. Difficult trade union issues also got resolved. Later, Mohan Kumaramangalam emerged as the de facto No. 2 of the government as Steel and Heavy Industry Minister.

The Union Cabinet those days had other professionals too—HR Gokhale, TA Pai and Prof Nurul Hasan. Kumaramangalam experimented by inducting a trade union leader, Bagaram Tulpule, as General Manager (CEO) of the troubled Durgapur Steel Plant of Hindustan Steel (now part of SAIL). And he inducted as Secretary, Steel, MA Wadood Khan, who too had a Communist background but had risen as a professional to be Managing Director of the Tata Oil Mills (TOMCO).

Sondhi, meanwhile, had become Secretary, Heavy Industry. The bid to successfully implement the dream of inducting outside professionals into government service received a jolt with the sudden death of Kumaramangalam in an air crash.

An attempt was also made to change the hue of the bureaucracy in the Janata government days. In 1978, M Menezes, a distinguished railway engineer, was made Secretary, Defence Production. In recent years, the Manmohan Singh government tried to modernise the civil services by setting up a department for Performance Management in 2009. The PMD was established under the Cabinet Secretariat and tasked with assessing the effectiveness of government departments in their mandated functions. A World Bank economist, Dr Prajapati Trivedi, was made the first Secretary, Performance Management. The PMD has produced a Results-Framework Document (RFD) for each department of the Central Government. After Narendra Modi came to power, the RFD has been aligned with the BJP Manifesto of 2014 as also with the goals enunciated in the President’s Address to Parliament.

The performance of the Industrial Management Pool or IMP was reviewed by a committee set up under two eminent officers in 1978—Bazle Karim and Dr S Neelamegham. It may be worthwhile to revisit the report of this panel before lateralappointments are thought of

Lateral induction may be an extension of the RFD concept, with personnel suited for specific tasks rather than generalists being appointed to positions above Joint Secretary so that policy implementation is taken to the next level.

In many countries, governments have the ‘revolving door’ concept: Governments hire professionals from private industry for their experience, their influence within corporations that the government is attempting to regulate or do business with. Political support (donations and endorsements) from private firms can be seen as a resultant by-product of this system.

Corporate entities, in turn, hire people out of government to gain personal access to government officials, seek favourable legislation/regulation and contracts in exchange for high-paying employment offers, and get inside information on what is going on in government.

THERE is need for caution—lobbying, which is emerging as an industry by itself as the economy grows, is benefitted by the revolving door concept. The main asset for a lobbyist is contacts and influence in government circles. This corporate climate is attractive for ex-government officials. It can also mean substantial monetary rewards for the lobbying firms and government projects and contracts in the hundreds of millions for those they represent.

While there is nothing wrong with lobbying per se, the Niira Radia episode has left a bitter trail.The fact that captains of industry ranging from Mukesh Ambani to Ratan Tata had promoted Radia underscores the need for caution against unsavoury lobbying.The fact that many senior retired bureaucrats, including some of those who had been entrusted regulatory roles post-retirement, had taken employment in Radia’s juggernaut highlights the perils of unregulated lobbying.

In Washington, lobbyists are listed and a Directory of Lobbyists is maintained in the public realm. For Naya Daur, not only technology and hardware but good practices of the United States of America may be necessary.

VOL. 8 | ISSUE 11 | FEB 2015

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