REPORT OF THE NATIONAL COMMISSION FOR GOVERNMENT REFORMS ON REFORMING THE GOVERNMENT IN PAKISTAN Vol - I (MAY 2008) National Commission for Government Reforms Prime Minister’s Secretariat Government of Pakistan Islamabad REPORT OF THE NATIONAL COMMISSION FOR GOVERNMENT REFORMS ON REFORMING THE GOVERNMENT IN PAKISTAN Vol - I (MAY 2008) National Commission for Government Reforms Prime Minister’s Secretariat Government of Pakistan Islamabad TABLE OF CONTENTS PREFACE …………………………………………………………………… iii-v COMPOSITION & TERMS OF REFERENCE ………………………….. vii-viii EXECUTIVE SUMMARY………………………………………………….. ix-xx ACKNOWLEDGEMENTS………………………………………………….. xxi CHAPTER – 1 INTRODUCTION……………………………………... 1-13 CHAPTER – 2 RATIONALE, CONCEPTS, PRINCIPLES AND APPROACH ………………………………………….. 15-26 CHAPTER – 3 RESTRUCTURING THE CIVIL SERVICES ……... 27-74 Civil Services………………………………………… 32-40 Creation of National Executive Service (NES) ……. 41-47 Creation of District Service………………………… 48-74 CHAPTER – 4 STRENGTHENING THE DISTRICT GOVERNMENTS …………………………………….. 75-92 CHAPTER – 5 REORGANIZING THE FEDERAL GOVERNMENT ... 93-131 CHAPTER – 6 IMPROVING HUMAN RESOURCE MANAGEMENT AND DEVELOPMENT……….. 133-207 Recruitment System……………………………. 135-140 Training Strategy……………………………….. 141-147 Strengthening Key Institutions of Governance….. 148-153 Performance Appraisal…………………………... 154-157 Promotion Policy and Career Progression………. 158-164 Posting Policy……………………………………. 165-168 Placement Policy ……………………………... 169-170 Compensation and benefits – Retirements and Post retirement…………………………………… 171-202 Staff Welfare…………………………………….. 203-207 CHAPTER – 7 SIMPLIFYING RULES, PROCESSES, PROCEDURES……………………………………... 209-220 Streamlining Rules and Procedures………………. 211-214 E-Government in Federal Government ………….. 215-220 CHAPTER – 8 GOVERNANCE AND DELIVERY OF ESSENTIAL PUBLIC SERVICES……………….. 221-255 Education………………………………………… 223-229 Health……………………………………………. 230-240 Police…………………………………………….. 241-251 Land Revenue……………………………………. 252-255 CHAPTER – 9 REFORMS OF SELECTED KEY INSTITUTIONS…………………………………….. 257-302 Federal Board of Revenue ……………………... 259-281 Pakistan Agricultural Research Council…..….... 282-286 Supreme Audit Institutions……………………... 287-299 Civil Aviation Authority……………………….. 300-302 CHAPTER – 10 THE WAY FORWARD……………………………. 303-313 PREFACE Following its creation in 2006, the NCGR was tasked with producing an analysis and recommendations on how government, its institutions and infrastructure can become more effective to meet the social, economic and political challenges that Pakistan faces in the 21st century. This Report produced by the Commission after deliberations during these two years is comprehensive and covers the restructuring of Government at the Federal, Provincial levels, strengthening of the district governments, reorganization of civil services, revamping of human resource management policies and practices, reengineering of business processes. These proposals summarize the findings from extensive research in the field and consultations conducted with a wide range of stakeholders spanning the public and private sectors, particularly the Federal Secretaries committee and the Provincial Governments. 2. A legitimate question may be asked: How does this report add value to the reports of the previous commissions, committees, working groups and task forces. The value addition takes place in at least seven distinctive ways. 3. First, it systematically updates the knowledge and problems facing the Government in the formulation and implementation of policies, programmes and projects, carries out a critical analysis of the reforms that have taken place so far and attempts to align the structure, processes and practices with the nature of the problems and difficulties identified. 4. Second, the report commits itself to utilize the entire workforce employed by the Government optimally by following an inclusive approach whereby it provides equality of opportunity to the majority of officers who are currently outside the occupational groups and service cadres in matters of recruitment, training, career progression and promotion on the basis of performance and achievements and does away with entitlements and reservations. There is a clear need to ensure that generalists and specialists are brought together under the highest policy making position matrix. 5. Third, the essence of decentralization and devolution to the local governments is extended further and strengthened by recommending creation of District Services under the control and management of the districts. All employees in Grades 1-16 in the devolved departments will become employees of the District governments improving span of control and accountability for results. At the same time it recommends transfer of functions from the Federal to the Provincial Governments. It also opens up the highest policy making positions at the Federal Government to qualified and competent Provincial civil servants by introducing regional quotas at those levels also. 6. Fourth, the interface between the public and the civil service administration has to be improved in a manner beneficial to the citizen. The current norm is one where the public deal with low grade, unqualified and ill trained officials who lack neutrality, integrity, and right attitude and often lack the skills to address the concerns of the citizens. These proposals recommend the need to ensure that there is a system where each district assigns young direct recruits in thanas, tehsils etc. to be the first point of contact with a citizen. These public servants would be authorized to resolve the problems and take the decisions expeditiously. 7. Fifth, a holistic approach is to be adopted for human resource management to turn civil servants into competent, motivated, well trained problem solving individuals rather than demotivated, ill equipped, poorly paid sticklers for rules. The emphasis is on a transparent and accountable merit- based approach that rewards performers and penalizes the recalcritrants. This will ultimately bring much needed cultural change to the organization; it will also ensure that mechanisms are put in place to address under-performance. 8. Sixth, it is proposed that the potential offered by e-Government should be exploited quickly and advantageously. The switch will ensure there is a move away from paper-based working towards a more efficient, productive and cost-effective approach. This will also imply that all government rules, regulations, circulars, instructions and manuals are readily accessible through web in the public domain and that the latest editions of documents such as the establishment manual, the ESTACODE and Finance Manual, are used instead of obsolete versions. This will not only curtail the discretionary and arbitrary powers of the lower functionaries but also encourage openness, transparency, lesser opportunities for corruption and accountability by the public. 9. Seventh, there are some well thought out ideas presented in the report for improvement in the delivery of essential public services: education; health; police; and land revenue in the short term. As most of the day to day transactions of an ordinary citizen pertain to these services, an early implementation of these recommendations would bring quick win. 10. This report is a road map that contains the proposals that will carry forward the reforms as a long-term initiative, rolled out over a 10-15 year period. It is hoped that the Government will continue with the review of these recommendations by a high powered Ministerial committee, modify and make changes where necessary and implement them on the basis of a time bound action plan with prescribed milestones and assigned responsibilities. Ishrat Husain Chairman Islamabad the 3rd May 2008 COMPOSITION AND TERMS OF REFERENCE OF NATIONAL COMMISSION FOR GOVERNMENT REFORMS COMPOSITION 1. Dr. Ishrat Husain Chairman 2. Dr. A. Malik Kasi Member 3. Mr. Shafqat Ali Shah Jamot Member 4. Mr. Shamsh Kassim Lakha Member 5. Mr. Farooq Rahmatullah Member 6. Mr. Asad Jahangir Khan Member 7. Mr. Shahid H. Kardar Member 8. Mr. Ejaz Rahim Member 9. Secretary Cabinet Ex-officio Member 10. Secretary Establishment Ex-officio Member 11. Secretary Finance Ex-officio Member 12. Ms. Nargis Sethi Secretary TERMS OF REFERENCE (TOR) (l) The Commission shall review and make a clear, precise and implementable set of recommendations in respect of: (a) the division of functions, responsibilities and accountabilities among the federal, provincial and local governments to avoid duplication, overlap and functional redundancy; (b) the appropriate size of government organizations, at each tier of government including attached departments, autonomous bodies, public sector corporations and other entities in the light of the responsibilities and functions assigned to each; (c) improving existing, institutional capacity through identification and meeting of skill gaps in the context of functions assigned to organizations of government at all levels; (d) the redesigning of rules and core business processes at all levels of government to achieve functional efficiency, client orientation, cost reduction, transparency and a shift of focus from process compliance to output and outcomes; (e) inter-linkages between; federal, provincial and local public services with a view to strengthening the federation through increased transaction efficiency and smoother conduct of business; (f) public service design for all tiers of government that would include: