Improving Sri Lanka’s public sector performance – Lessons from UK

The National Human Resources Development Council (NHRDC) of Sri Lanka in collaboration with the Chartered Institute of Management Accountants (CIMA) Sri Lanka organised a breakfast session on ‘Lessons from the British Public Sector to Improve Public Sector Performance’, recently.

CIMA Global President Steven Swientozielskyj FCMA, CGMA graced the event as the guest speaker and Finance Ministry Director General V. Kanagasabapathy moderated the discussion. NHRDC Chairman Dinesh Weerakkody and newly appointed Chairperson of the CIMA Sri Lanka Network for 2018/2019 Manohari Abeysekera were also present at the event, with many industry leaders and high key professionals.

A report issued by the Census and Statistics Department in 2016 estimated there are 32,000 institutions under the public sector in Sri Lanka, with more than 1.1 million employees, excluding the three Armed Forces. Of the total number, 55 percent were males and 45 percent were females. Almost 42 percent had some form of professional or vocational qualification. More than 57 percent of females covered in the census were professionally qualified while only 30 percent of males had any professional or vocational qualification.

Delivering the keynote address Swientozielskyj said that individuals in a country must continue to learn and be educated to compete with the global market. Swientozielskyj has served in many leadership capacities in both the public and private sector organisations in the UK, across several industries.

He said service orientation and service speed as key success factors in serving the community while lack of professionalism and negative attitudes towards intellectual challenge hindered it. Improving the public sector requires the ability to change and also be cost effective.

He noted that privatization might not necessarily be the solution for public services and the key advantage in privatization was rooted in cost reduction.

“It is not possible to charge more if the service was unacceptable,” he remarked, adding that people would be willing to pay more, if they were pleased with the services obtained.

The commercial driver is seen as the main force for change in the private sector. His advice to the public sector was to adopt best practices already learnt by the private sector.

Abeysekera speaking at the event said that the public sector officials have a key role to play in taking Sri Lanka to the next step, as they are guardians and custodians of the taxpayers’ money. With regard to the target of making Sri Lanka a regional hub by 2025, she warned that Sri Lanka would have to consider competing with Bangladesh as well, apart from India and China. She noted that honesty and integrity need to be the cornerstones in the public service.

Kanagasabapathy said that for a small country, Sri Lanka has a relatively large complex public sector, with many administrative structures and a bloated employment cadre. With the country facing severe hardships, overwhelming debt burden, low government revenue and high expenditure, he said it is further intensified by continuous budget and BOP deficits. He noted that the public sector salary expenditure is estimated to be around 20 to 30 percent, while the interest burden on public debt is also around the same value.

Meanwhile, repayment of public debt requires borrowing continuously. As Sri Lanka has surpassed US $ 4000 per capita GDP, with no more access to concessions, we must borrow at commercial rates.

Sri Lanka is caught in a vicious circle in borrowing to repay loans, which is barring capital investment, he said. He remarked that a lot can be learnt from developed countries but the main concern in the Sri Lankan context is that the public sector is dominated by political interference, hindering a continuity of a national policy.