Published on The Daily Star
Issues such as minimum labour wage and work environment for garment workers often remain outside the ambit of national policymaking.Photo: STARThe issue of policymaking for national development by the state can be discussed by looking into three questions: what, how and for whom. The answer to the very first question lies with the basic definition of a “state”.
In simple terms, state is a social system comprising a set of rules that are executed by the government or a permanent body. State has also been defined as a set of socio-economic and political institutions that exercise the power to govern and rule over the population within a definite territory.
However, the roles and responsibilities of state have changed and transformed significantly over the years in the era of globalisation. These have moved away from the welfare oriented and interventionist approach to a competitive and “minimalist” one.
In the neo-classical era, the role of the state has been narrowed down and it was argued that the state should be as “minimal” as possible since state intervention only creates inefficiency and misallocation of resources.
However, the state still has a role to make strategic planning in economic and social fields and establish legal and institutional framework.
In view of the current global financial situation, the role of the state has once again been felt prominently.
In view of the failure of the corporate sector, states all over the world had to come forward to rescue them through various stimulus packages. It is now recognised that making only policies is not enough. One has to look at issues such as how policies are implemented and what kinds of policies are being formulated.
Is the state being pro-active towards combating poverty and reducing unemployment? Is the state being able to create a level-playing field or an enabling environment for all actors? Is the state promoting development that is sustainable?
To fulfil these objectives, the state has to ensure an enabling environment which includes the following, among others: effective legal framework for economic activity; price stability and responsible fiscal intervention; an equitable tax system; developed and competitive labour, financial and capital markets; promotion of small and medium enterprises; access to information by all; promotion of technological and infrastructure development; strong institutions of governance and the rule of law; and credible and independent judicial institutions.
How should policies be made? The objective of a democratic state is to make policies efficiently and implement them effectively. Efficiency is an attribute of good governance, the pre-condition of which is transparency and accountability in the policymaking process and their implementation.
Transparency and accountability can, to a large extent, be ensured by making policies participatory and inclusive.
What has happened in majority of the poor countries is that effort to involve the broader participation of stakeholders in the development process has not been a common practice, be it national plans or any legal or regulatory reform or other micro and sectoral policies.
Historically, these countries have to rely on development partners in one way or other. Hence the development agenda is designed in accordance with the desire of their development partners.
As a matter of fact, the policymaking process for development has not involved exhaustive participation of larger sections of stakeholders in the society and thus could not generate constructive discussion and debate around the objectives, priorities and strategies presented in these documents.
Hence national policies have mostly tended to be an exercise carried out by the bureaucrats and technocrats, with some notional representation of a few academics and civil society leaders in recent times.
A recent example in this case is the process of poverty reduction strategy in several countries. In most cases people had marginal involvement in this whole episode in terms of its formulation and implementation.
Another issue is that policymaking is not the end. What is more important is their implementation. Because of a lack of broader engagement in policymaking, the effectiveness of state policies also remains questionable.
It is observed that in poor countries ambitious policies are being undertaken, but their implementation remains either underachieved or the outcome is unsatisfactory. Here comes the issue of quality.
The education sector in Bangladesh is a case in point. Bangladesh has achieved millennium development goals in case of primary education and can showcase its progress in this area as one of its success stories. Unfortunately, the quality of those who come out of schools and colleges are very poor.
For whom the policies are made? It is now broadly agreed that “minimal state”, that is, smaller role of the government, deregulation and privatisation have not been sufficient to foster sustainable human development.
There is also a growing agreement on the fact that economic reforms need to be complemented by better social policies. The state has thus an important role to play in providing affordable social services for those who are underprivileged. Experience also shows that economic growth alone is not sufficient to sustain equitable human development.
The state has a redistributive role too. This is all the more important today in order to minimise the negative effects of globalisation. Because the integration of countries into the global economy has brought in opportunities in the area of exports, imports, remittances and foreign direct investment.
But it has also been accompanied by several challenges. For example, trade policies in the global forums such as the World Trade Organisation may not necessarily benefit all countries in the same manner.
Bangladesh has been one of the most successful countries in terms of utilising the benefits of globalisation through increased export of its readymade garments and shrimp. But issues such as minimum labour wage, work environment, protection of the natural environment very often remain outside the ambit of the national policymaking process.
Hence, the state in the new era will not only have to include the disadvantaged section of the society but also the future generations. This is possible through fiscally responsible intervention by the state.
Finally, it is increasingly being acknowledged that good governance is a key element in the development process of any country, and in ensuring that globalisation benefits all in society.
The state, in partnership with civil society and the private sector, has the major role to play in achieving social equity and sustainable development. The failure in making a sustainable development policy is not only due to the failure of state to involve broader stakeholders, but also for the fact that in many countries there is a lack of capacity of policymakers in the governments.
Such capacity constraint not only deters governments to take policies in a creative and innovative manner at the national level but also at the global level. The growth and human development experience of Bangladesh are much better compared to its South Asian neighbours.
However, there is still a lot more scope for improving and reforming public administration and governance systems. And this is critical for alleviation of poverty and reduction of income inequality, advancement of human rights and democracy, protection of the environment and promotion of sustainable development.