Going forward: robust good governance in the public sector

In a recent radio interview, the Minister for Energy and Public Service, Ivan Collendavelloo, stated that a decision was being taken to put the Central Water Authority (CWA) under private management. He supported this decision on the need for the CWA to overcome a disastrous situation it had landed in.

Up till now, investments in the country’s water system have been from the public sector. The CWA is a parastatal body. Reservoirs have been and are still being constructed with taxpayers’ money. The CWA’s manpower is also paid for out of water dues collected from users but also from the public purse.

The CWA’s finances would not be in the best of shapes. Its water pipes are said to be in such a bad condition in parts of the country, due to non-replacement since colonial days, that allegedly half the treated water they carry is lost en route due to leakages. The opportunity forgone is evident, both in terms of dilapidation of public funds and in terms of lost supply of water.

The reason partly for the parlous state of affairs in the parastatal body is the low but politically-sensitive rates for water charged by it. The other reason for this predicament is the customary laissez-aller for which much of the public sector is known.

But water is one only of various publicly-controlled activities that have gone in disarray. Last week, the Bank of Mauritius (BoM) released a document in public purporting to be a redacted version of the report from Singaporean consultants, nTan Corporate Advisory Pte Ltd, who had been commissioned by the BoM to examine and report on the finances of a bank belonging to the British American group of companies.

The report brings out various departures from sound business practices that the group would have indulged in to hide transactions prohibited by financial regulators, and undertaken by both the group’s banking and non-banking entities. The effect of all this is possibly the irrecoverability of several billions of rupees of public money entrusted by depositors, insurance policy holders and investors in the group’s companies.

Apparently the loss incurred involved serial flows of investments into related companies of the group over a long stretch of time, far in excess of permitted regulatory limits. According to the consultants, the group would have camouflaged or concealed transactions through questionable accounting practices to avoid showing the losses they kept incurring over a long stretch of time. This kind of practice would have served to shield their economic non-performance and the siphoning off of money for private use from trusting members of the public, who kept pouring money into falsely lucrative financial products being sold by the various companies of the group.

There are articles which deal with these issues in today’s edition in more depth. We do not propose to discuss details pertaining to the consultants’ report here but we must ask the question as to how the public have apparently been hoodwinked into entrusting their hard-earned money to financial institutions like Sunkai, Whitedot, etc., and others, only to realize, when it is too late, that they have been fooled.

The laissez-aller to which we have drawn attention above in the case of the CWA and now in part of our financial sector seems to indicate that there would be a more fundamental flaw in the system which allows situations to deteriorate to the point of no return. Is it that defaulters are becoming smarter at a time when there is a general buzz in the country about all sorts of smart things we are gearing up to?

Why did those in the public sector who were specifically appointed to ensure that all operators should work within given sound parameters of governance not stem the rot before it was too late? Did the operators assume that they could flout given rules of good conduct at will? If so, why? How deep is the wound that such flouting of the rules might have inflicted on our country? What will be its consequences on future good governance?

We have seen how the country’s opposition takes up the cause of those who are very often ‘provisionally charged’ by the police, only to be ultimately dismissed when the matter comes to the crunch in court for want of supporting evidence.

The latest in the series is perhaps the case of Ish Sookun, an IT specialist, who has been held in police custody during the ten last days for having been suspected of sending an email connected with a terrorist threat to the PMO. The police appears to be still on the lookout for solid evidence to spot him as the sender of the email – after having kept him in custody for so many days on mere suspicion.

Yet, the very same opposition, when it comes to power in our now classic alternating power system, turns a blind eye upon the potential abuse of the ‘system’ when it is employed to unfairly persecute the regime’s adversaries.

This kind of inaction projects a willingness on the part of the political authorities to cultivate an atmosphere of ambivalence, when it suits their purposes. Obviously, it doesn’t help to give the system a full-proof objectivity to deal straightforwardly with issues, when they arise.

Without gauging the full impact of such ambivalence running across the board, politicians may not be realizing until it is too late that harm has been done to the proper functioning of public institutions. That this system of abuse of good governance is undermining the heart of the entire public sector apparatus, especially so if it spreads out over the larger part of the public sector spectrum.

Often, there have been statements made that subordinate staff in certain public institutions have defied their bosses, feeling that they are protected by a political shield which appointed them over there in the first place. Not only does this sap authority. It demonstrates, if that were necessary, to those placed in a position of command in public bodies that they are vulnerable: not because they don’t have the skills to do their jobs, but because they can be jettisoned if they earn politicians’ displeasure for not complying with one stupid request or another.

This way, political pressure and all manner of lobbies have kept undermining the highest offices of the land by getting appointed to them not the most qualified Mauritians capable of lifting a sector to its summum but their own sectional ‘representatives’, irrespective of his/her incompetence to run the post efficiently. Is it surprising then that our public institutions do not focus on the right objectives they should be pursuing? Why should they not fail to accomplish their mission statements, having been empowered to make inept politically correct decisions by this process?

The systemic inefficiency that politics has been inducing in our system of public governance ultimately demands a price. Institutions are emptied of their real substance in the course of time. Their lines of succession are filled with incompetents waiting to be enthroned as governments change, for having placed themselves in the right limelight before elections are held.

It is not really their concern that the parastatal or public post in which they’ve been ‘installed’ shouldn’t fall short of what the public expects from it. Who cares if the institution fails to deliver? At least, it will give the next alternating government the opportunity to blame the preceding one for its various shortcomings and, by the same token, help it place its ‘own men and women’ in the top positions until the next round comes back.

This kind of a nationally debilitating game has been carried too far, at our bitter cost. Mauritius should realize perhaps that if it wants to make it to the top, we risk falling into the category of states which yield to all sorts of lobbies continuously and eventually fail to provide the basic necessities to their peoples. Chanakya said thousands of years ago that one instinctively knows when one is not abiding by the rules of ‘good governance’; it doesn’t have to be taught. We should know.

M.K.

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