Planning a revamp

  • The time has come to replace the National Planning Commission with an independent economic council
Planning a revamp

Sep 9, 2014-

In 2005, at a dinner reception hosted by the head of one of the aid agencies in Nepal, a recently retired vice-chairman of the National Planning Commission (NPC) made a telling comment. While discussing the role of the NPC, the former vice chairman, without any hesitation said to the guest of honour, “Our NPC is like a toothless tiger; it is unable to do anything.”

Sadly, in the nine years since, things haven’t changed in terms of the NPC’s productivity. While we may have dedicated people in the commission, they are bound by many restrictions, preventing them from functioning independently. This situation calls for a major overhaul of the system, which will revamp the current state of affairs and allow the NPC to function as a professional organisation.

Too many responsibilities

The foremost problem with the NPC lies in its ambiguous roles and responsibilities. Is it a national planning authority entrusted with formulating a plan or an agency responsible for monitoring development activities? Is it also entrusted with conducting critical policy research? What about measuring the impact of development works? The bottom line is that the commission has been entrusted with a multitude of responsibilities, perhaps too much for it too handle.

To tackle this problem, we could look at models adopted in other countries where there are separate institutions, created along a think tank model, to provide research-based input for the plan formulation process. Ideally, the NPC should be setting a strategic direction for each line agency to prepare its own plan based on the research conducted by development think tanks. There is no need for the NPC to interfere in plan formulation activities; that should be left to the concerned line agencies.

The second problem lies in its governance structure. NPC members are appointed by the Cabinet and remain in their posts until the tenure of the government ends. In principle, this fits the bill of a proper system, as the NPC’s role is to advise the incumbent government to formulate and implement policies. But given Nepal’s track record of political instability, how apt is this particular system in a country where no government has lasted the entirety of its five-year tenure since 1990?

Lacking expertise

Another critical problem with the NPC is the composition of its staff. The NPC functions like a government ministry rather than a professional organisation. Staff at the NPC are civil servants, who are transferred from line ministries. Therefore, there is every possibility that those transferred to the NPC lack the required knowledge to conduct policymaking activities, economic analysis and research.

The broader point here is that economic planning is not taken seriously and rather, is seen as a routine administrative job. For example, a Chief District Officer could become a Joint Secretary at the NPC the next day, and he/she might have no clue on how to discharge his/her critical responsibilities.

There is little motivation for career civil servants to join the NPC. A former NPC Secretary informed this scribe that the sole purpose of joining the NPC is often to look for opportunities to further one’s career or studies. Once they have achieved what they set out to, officers are keen to get transferred to other ministries, away from the NPC.

Another critical issue for NPC concerns political interference in project selection. Since members are selected based on political blessing, a lot of their time is spent in dealing with political leaders and approving of petty projects to please their political masters. As NPC members are nominated with political backing, they have limited knowledge of policymaking and economics, and hence, senior bureaucrats from line agencies like the Ministry of Finance and even within the NPC tend to bypass them. Their role thus becomes confined to attending ceremonies and giving speeches rather than doing real business.

A new council

There is, therefore, a pressing need to dissolve the NPC. It could instead be replaced by a Council of Economic Affairs, which would be endorsed by the Parliament and work directly under the Prime Minister. The Council would comprise of four members of high calibre, without any political linkages. They should be endorsed by the Parliament and must remain in their positions for a minimum of five years.

The Council should be given full autonomy in the selection of highly qualified candidates from the market to work in different sectors. The main function of the Council would be to chalk out long term strategic guidelines for overall economic development; provide economic advice to the PM; conduct research and provide inputs for sectoral policymaking; and strengthen the data collection process.

A separate department for the effective implementation of plans, placed under the Office of the Prime Minister and Council of Ministers could be responsible for monitoring development activities and ensuring coordination among different line agencies. There should be a minimum of three specialists in each area for effective monitoring. This is a model that has been successfully implemented in Malaysia.

Additionally, effective planning depends on effective data and the current situation, in terms of the Central Bureau of Statistics (CBS), is pretty bleak. The CBS (which is under the NPC) needs a major overhaul to make it an independent and competent institution that is able to provide the data needed for the policymaking process.

In a nutshell, the NPC requires an overhaul. This will create a conducive environment to both attract new expertise to planning and policymaking and retain the expertise we currently have.

Sigdel holds a PhD in Development Management from the University of Birmingham, the UK

Published: 10-09-2014 09:33

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