Improving Service Delivery for Better Outcomes: A Case Study of Kerala

Transcription

1 ASCI Journal of Management 37(1): Copyright 2008 Administrative Staff College of India M. SURENDAR REDDY* and B. LAKSHMI** Improving Service Delivery for Better Outcomes: A Case Study of Kerala The Government of Kerala formulated a people-centric Service Delivery Policy for Kerala in This is a major attempt by the state government to enhance the efficiency and effectiveness of service delivery and ensure the sustainability of Kerala s unique social and economic development. By its very nature, the policy is a long-term citizen-focused initiative. This paper focuses on: (i) the key issues and debates in service delivery and (ii) the initiatives for service delivery reform taken up by the Government of Kerala through its Service Delivery Policy. A brief concluding section contains observations on the issues emerging out of Kerala s attempt to improve service delivery and its possible replication in other states. The future success of the initiative taken in Kerala to transform service delivery will demonstrate that a structured, well-designed policy is an essential pre-requisite for improving service delivery outcomes. Introduction Public sector reform has been at the top of the policy agenda in many countries. Improving service delivery for citizens is one of the main thrusts in these attempts to reform the public sector. For most countries, changes occurring in the economic and social environment including technological change in the way information is disseminated and accessed in the public domain have had a tremendous impact at every level of society. The expectations and demands of citizens vis-à-vis state-provided services have undergone a transformation. Citizens are more aware of their rights and are more vocal in demanding those rights. The state, on the other hand, is having to contend with growing constraints on its financial resources from a shrinking economic space, following the paradigm shift in its role since the 1980s. * Professor, Economics area, Centre for Economics and Finance, Administrative Staff College of India (ASCI), Hyderabad. ** Associate Professor, Health Studies area, Centre for Human Developmnt, ASCI, and Programme Director, ASCI Post-Graduate Diploma in Hospital Management.

2 Reddy and Lakshmi Improving Service Delivery: Case Study of Kerala 31 Delivering better services to more and more people, i.e., improving quality and access, has become a key objective of public sector reform. New approaches to designing improved service delivery systems are a major part of public sector reform initiatives throughout the world. Developing countries as diverse as Malaysia and Mexico, Ghana and India are attempting to improve service delivery in a variety of contexts and are using different modes of service delivery (World Bank, 2004). Kerala, one of India s four southern states, has put in place a major initiative in recent years for transforming service delivery on a long-term basis within the framework of its Modernizing Government Programme (MGP). The aim has been to transform the delivery of public services across all major departmental institutions throughout the state. Like many other citizen-centered, development-oriented initiatives taken up in Kerala, this too is remarkable for its scope, content and structured approach. This paper takes up two themes: (i) the key issues and debates in service delivery; and (ii) the initiatives for service delivery reform taken up by the Government of Kerala through its Service Delivery Policy formulated in A brief concluding section contains observations on the issues emerging out of Kerala s attempt to improve service delivery. I. Improving Service Delivery: Transnational Experience Service delivery is one of the most important interfaces between a modern democratic state and its citizens. The aim of public service delivery is to deliver cost-effective, high-quality services that the private sector is unable or unwilling to deliver. A wide range of civic and welfare services are covered by any comprehensive definition of service delivery. Social expenditure, which is the core of public service delivery, includes expenditure on health, nutrition, literacy, education, social welfare safety nets for vulnerable groups and all other areas that improve the quality of life of citizens. For developing countries that have a large proportion of their population below the poverty line, the goal of poverty alleviation requires that essential services be brought within the reach of the poor who need them most. Hence the emphasis on a pro-poor focus articulated in the service delivery principles set out by the Government of Kerala as inclusiveness as a major thrust of service delivery. Why do public services need to be improved? Most often, there is no universal coverage of essential services. Citizens are not fully informed and aware of their rights, and public services are not delivered in an equitable,

3 32 ASCI Journal of Management 37(1) Sep 2007 efficient and transparent manner. Services are inadequate, poor in quality, difficult to access and often unaffordable for large sections of the population. The expansion in coverage of existing services and the ever-increasing demands for a new set of services over citizens life cycles makes service delivery a long-term process. Economic changes occurring within countries and globally are leading to more competitive markets for goods and services and consequently greater uncertainty about livelihoods. This will lead to greater dependence on the state for economic security, with implications for public service delivery. The emphasis on citizen-centered governance is another factor influencing current approaches to public service delivery. As societies adapt to the fast-changing reality and citizens have greater expectations and demands from the state, the whole framework of service delivery is being looked at from a different perspective. This also means that a comprehensive set of basic services (essential to human rights) remains within the framework of state provision in the foreseeable future Key Issues in Service Delivery Service delivery is essentially about a committed state fulfilling its responsibilities towards its citizens needs for essential services. In this context, the key issues in service delivery that have emerged relate to: (i) the state as the best provider of basic services e.g., water, sanitation, education, health services to citizens; (ii) the cost-effective pricing of services to ensure access and sustainability; and (iii) the importance of decentralization as the best option for improved service delivery to citizens. State as provider: Is the state the best provider of basic services? Clearly, this question can be fully answered or resolved only at the country-specific and service-specific levels. Nevertheless, there is a broad consensus that the state is the best provider of a wide range of basic services. This is especially true of public goods, which the private sector cannot provide as it will be unable to capture all the externalities of such provision. Again, the state excels in the case of positive externalities and economies of scale. It can also be argued that universal access to certain services e.g., water, education and health is a matter of right and cannot be made to depend on the ability to pay. For these reasons, when service delivery has to have a pro-poor focus, the traditional centralized public sector may be the most appropriate delivery system (World Bank, 2004).

4 Reddy and Lakshmi Improving Service Delivery: Case Study of Kerala 33 However, the private sector is a major player in service delivery in many countries and is gaining ground in areas such as health, education and housing. In recent years, alternative models of public-private participation (PPP), based on viability and sustainability, have been developed with a growing role for non-state players. The range of options is from government monopoly in the supply of services at one end to privatization based on total transfer of responsibility for service delivery. The state can provide, finance and/or regulate services to citizens. The form of public-private collaboration varies, with different forms of sub-contracting and outsourcing of services. The country-specific context influences the choice of model and the extent of private sector involvement. There are several dimensions to this choice: the political, social, economic and cultural environment on the one hand; and the institutional, business and technological environment on the other (Prefontaine et al., 2000). It is, however, now recognized that with regard to development goals, the state needs to play a proactive role in vital sectors like public health and basic education; the private sector can provide other services within a framework of effective state regulation. Though some degree of privatization of services is gaining momentum in several developing countries, the state will continue to play a significant role, as privatization is not the answer in all situations. The policy challenge is to find the right balance that will produce the best outcomes for citizens. Pricing of services: Delivery of public services raises key issues of access, quality, sustainability and affordability. How services are priced is critical to citizens perceptions of service delivery. The fiscal implications of delivering widely-accessed, low-cost, high-quality services in a sustainable manner are a serious constraint on the state as service provider in most countries. The debate on pricing covers arguments in favour of free/ subsidized public services (especially for populations which cannot afford fully priced services) and those in favour of a type of user fee or different combinations of each to make public service delivery more cost-effective in reaching the target groups. Since most public services involve public goods (with collective consumption) there are no clear pricing criteria for their delivery. The state has to balance desired outcomes wider access, high quality of services, equity and cost-effectiveness with the financial resources available and then prioritize service areas. If public services are targeted mainly at those sections that cannot afford to pay market prices, the equity principle of service

5 34 ASCI Journal of Management 37(1) Sep 2007 delivery will necessitate an element of subsidization for providing services at partial or nil cost. Ensuring effective service delivery in the face of rising fiscal constraints is one of the central challenges facing most countries. Decentralization: The shift to a more decentralized framework of service delivery, with an emphasis on local-level initiatives, is one of the most important developments in service delivery management in recent times. Decentralization in political, administrative and financial terms can lead to improved outcomes as a result of according higher priority to local needs, better participation and involvement of user groups, and greater accountability and responsiveness on the part of service providers. This has the potential to transform service delivery in significant ways. However, certain conditions are necessary for decentralization to be an effective strategy to improve service delivery: adequate finances at the local level; benefits not captured by local elites; and strong bargaining power (Bardhan and Mookherjee, 1998). Since the 1980s, over 75 countries all over the world have attempted the transfer of state responsibilities to lower tiers of government. In most of the countries surveyed, improving service delivery is the most important objective of administrative decentralization. In 1992, India enacted the 73 rd and 74 th Constitutional Amendment Acts to devolve political, administrative and fiscal powers to the lower tiers of government. This has legally paved the way for improved service delivery with greater citizen participation and accountability of service providers at the local level. Kerala s Service Delivery Policy is being implemented by the state and local governments within a decentralized framework with funds from the central, state and local governments. New Approaches and Initiatives As public sector reform gains momentum in several countries, new approaches are being adopted to improve service delivery. As populations have increased, the quality of services provided has come down. The new initiatives have come about mainly in response to the pressures from citizens, progress in information technology and the range of options now available for delivering effective services to citizens. Batho Pele or People First is an initiative implemented by the Government of South Africa (Govt. of South Africa, 1997). The approach is based on eight principles, or transformation priorities, that have been identified for further action: consultation with citizens; setting service standards; equality of access; ensuring courtesy; full and accurate information; value for money;

6 Reddy and Lakshmi Improving Service Delivery: Case Study of Kerala 35 openness and transparency; and grievance redressal. Based on these principles, further action is taken by the national and provincial departments. The Citizen Report Card initiative was started in Bangalore in Public sector agencies were rated by citizens with regard to the delivery of services in terms of public satisfaction, corruption and responsiveness. Based on the report card, steps to improve service delivery follow, with visible results (Paul, 2004). Choice and voice are two requirements that have been identified for shaping more participatory, citizen-centered approaches to service delivery in the UK (ODI, 2004). Citizens require choice in making services work for them; they must also be able to voice their needs to a responsive state. Other initiatives adopted in different contexts include one-stop access points for service delivery to ensure easy access and simplification of procedures. Modernization of service delivery through electronic modes of access and delivery is widely prevalent in most countries. Reorganizing structures of service delivery through service cluster arrangements is also being tried out in Canada. (Govt. of Canada, 2000). A key document for effective service delivery is a citizen s charter with clearly stated objectives. This was a breakthrough in service delivery management in the UK in the 1990s. Citizens charters need to specify: the responsibilities of service providers, quantifiable service standards, compensation to users (in case of non-performance in service delivery) and instant redressal mechanisms. Summary: There is a growing emphasis on public sector reform all over the world to restructure, improve and modernize service delivery systems. Perspectives on the rights of citizens and the responsibilities of service providers are changing in the direction of more high-quality and cost-effective services. New models of public-private collaboration and a greater number of local-level initiatives are seen as the best options for improving service delivery. II. Case Study of Kerala The state of Kerala, with a population of 32 million persons spread over 14 districts, has an outstanding record of achievement in human development acclaimed all over the world as the Kerala model. In almost every aspect of human development, this particular state leads India. In the areas of literacy,

7 36 ASCI Journal of Management 37(1) Sep 2007 health, education, economic status of women and people s participation in political life, Kerala s position is far ahead of the other states. However, despite the impressive level and quality of Kerala s development, as reflected in its human development indicators, the state faces enormous pressures. These challenges are similar to those faced by most other states in India reconciling growth with equity and overcoming severe fiscal constraints. The last factor has important implications for the restructuring of service delivery in the state and sustaining the gains made in the past few decades. According to the Economic Survey (Govt. of India, 2003), the state s spending on development has been declining relative to overall spending. Since the year 2000, the expenditure on the health and education sectors has fallen. Kerala has also seen stagnation in its share of transfers from the Union government and a rise in its fiscal deficit. The impact of Kerala s fiscal pressures and the reduction in development expenditure on its service delivery has become evident. An assessment of the effectiveness of service delivery in 22 states in India in 2003 ranked Kerala at the average level among all states in the country (Public Affairs Centre, 2003). The attempts by the Government of Kerala to improve service delivery are viewed in this section against the backdrop outlined above and in terms of the key issues dealt with in Section I. Kerala s Service Delivery Policy The Government of Kerala formulated a people-centered Service Delivery Policy for the state (via GO(P) No. 260/2004/GAD dated ). This policy was to be operationalized by all the departments within the time frame fixed for its implementation. The main aims of the policy were to overhaul government systems and institutions so as to enhance the efficiency and effectiveness of service delivery; and to develop service standards that would enable citizens and service providers to track service performance and take corrective action where appropriate. In short, the Service Delivery Policy prepared for Kerala is an intervention at the State level to prepare the ground for sustaining Kerala s unique social and economic development in future years (Govt. of Kerala, 2003: 1). In the first phase, the policy was to be implemented in 22 types of institutions in eight selected government departments all over the state. The departments

8 Reddy and Lakshmi Improving Service Delivery: Case Study of Kerala 37 were among those in the forefront of service delivery: Health, Education, Social Welfare, Food & Civil Supplies, Registration, Revenue, Home, and Local Self-Government. The 22 types of institutions include district hospitals, taluk hospitals, primary health centres and community health centres (for the Department of Health); old age homes, anganwadis (day care centres) and welfare institutions (for the Department of Social Welfare): collectorates, taluk offices and village offices (for the Department of Revenue) and so on. The main objective of this first phase of implementation was to transform a total of 2,585 institutions (out of 30,000) all over Kerala into models of service delivery. 1 Principles and Implementation of Service Delivery A set of eighteen principles of service delivery were identified in the policy document: people-centeredness, laying down clear standards, equity, transparency, accountability, integrity, fairness, good behaviour, rationality, efficiency, convergence, right to service delivery, grievance redressal, continuous improvement, attitudinal change, sustainability, inclusiveness and holistic approach. These were the underlying principles of the approach to be adopted by institutions for delivering their services. The Service Delivery Policy provided the basis on which plans were to be formulated and implemented at the organizational level. The implementing agencies were required to prepare a strategy for service delivery improvement in their respective departments. The focus was to be on setting standards with regard to processes (inputs) and outputs; and improving service delivery in terms of specified time periods, resources, performance standards, and performance measurement and information management criteria. Emphasis was also placed on the monitoring of services with internal and external audits. The draft strategy document for each department was to be finalized and published after public feedback. Implementation of the Service Delivery Policy required changes in the rules and procedures as identified in the departmental strategies to improve service delivery. Further, the required resources and funds were to be made available in time to all the service delivery institutions to meet the requirements of infrastructure, manpower and consumables. 1 An advisory team from ASCI, Hyderabad, was associated on a consultancy basis with this phase of implementation of the Service Delivery Policy in Kerala. The team also helped to draft the policy itself

9 38 ASCI Journal of Management 37(1) Sep 2007 An important related initiative approved by the Government of Kerala was the progressive introduction of citizens charters in all the departments in which the Service Delivery Policy was being implemented and to ensure that all service delivery plans were linked to the charters. Service Delivery Management A major initiative launched by the MGP in 2004, in accordance with the aims and objectives for service delivery improvement outlined in the Service Delivery Policy, was to train government officials at all levels. Training was conducted in the selected institutions of the eight chosen departments to carry through the principles of service delivery management and make the process sustainable. A six-month Certification Programme in Service Delivery Management (January to June 2006) formed the final part of this phase of implementation. About 200 government officials chosen from across the state, on the basis of a written test, attended a series of contact workshops on service delivery. The course curriculum included conceptual issues on the changing role of the state as a service provider and the changing demands of citizens in a globalized world. Key issues in service delivery, based on the Kerala context and the situation faced by the officials in their day-to-day interaction with citizens who access government services, were also included. 2 The service delivery initiative described above is to be scaled up to include more government departments and institutions in successive phases. The medium-term objective is to train around 10,000 government officials in the tools of service delivery management. This will ensure the long-term sustainability of the initiative and enable the provision of better public services in a more effective manner over citizens life cycles. 3 III. Observations on the Case Study The service delivery initiative of the Government of Kerala is unlike any other development effort in its scope and content. Hence, it is difficult to evaluate the initiative along the lines of the more conventional development projects. It is a major attempt by a state government to transform the entire scenario of service delivery in government departments in terms of processes 2 The Certification Programme was conducted by members of the ASCI faculty in collaboration with the Institute for Public Administration, Malaysia. 3 MGP includes other initiatives as well.

10 Reddy and Lakshmi Improving Service Delivery: Case Study of Kerala 39 and outcomes. By its very nature, the service delivery initiative is a continuous and lengthy process whose benefits may be evident only after a period of time. The benefits can be suitably assessed by the citizens themselves. They are in the best position to evaluate whether the Service Delivery Policy has resulted in better access, quality, cost and effectiveness of public services. Such an evaluation based on citizen surveys can take place only at some future date. At this stage all that is attempted here is an overall assessment in the form of some general observations on Kerala s service delivery initiative keeping in view the broader development issues outlined earlier. Evidence from several countries points to the fact that change is better managed at the local level. Since local governments are major players in the context of service delivery within Kerala s decentralized framework, implementation of the service delivery plans is likely to conform to the service delivery principles identified in the policy document. Kerala meets the crucial conditions specified for decentralization to work effective citizen participation, transparency and lower risk of local decision-making being captured by elites (Harilal, 2005). The fiscal dimension as in other sub-national contexts in almost all developing countries is much more problematic. The availability of financial resources is likely to remain a constraint as governments struggle to raise resources for development while trying to check the rapid rise in non-development expenditure. However, the crux of public sector reform in relation to improving service delivery is not about finances. It has to do with improving the efficiency of service delivery by bringing about an attitudinal change in public sector employees who are in the frontline of delivering services to citizens (Pattakos, 2004). By its very nature, this is a slow process and will take time to show results. Institutional change through capacity building is a related area with a positive long-term impact on service delivery. A study of select sub-saharan African countries found that weak capacity was at the root of the problem of poor public service delivery (OECD, 2002). The public sector interventions suggested were enhancing staff skills, improving management systems and structures, restoring incentives, and improving the work environment. Clear institutional goals, innovative management practices and empowerment of local government institutions are other aspects of institutional change.

11 40 ASCI Journal of Management 37(1) Sep 2007 Better accountability mechanisms based on clarity in procedures and processes have to be in place. Transparency and accountability are the two most important aspects of public service delivery, as perceived by citizens. An improvement in these aspects has a direct impact on the quality of service delivery. There is also a need to integrate service delivery with other public sector reforms to make it more comprehensive, broad-based and sustainable. Countries are still finding their way to the most suitable approach. The Kerala initiative is an important milestone on that journey. However, certain problems were encountered while implementing this initiative, which also need to be mentioned. There was reluctance at some levels to bring about change due to rigid attitudes. There were problems relating to rules, regulations and fund flows, which had to be changed and adapted for purposes of improving service delivery. Often there was lack of cooperation and coordination among the heads of various departments at the district and state levels. Future public sector reform in the context of service delivery will involve a range of interventions in human development, devolution of powers and functions to local governments, and grassroots participation in decisionmaking processes (Pedroso, 1999). Kerala has attempted to achieve all of the above through its service delivery initiative. Given its past record and the continuing pressures from internal and external factors on citizens to demand more and better public services, the state needs to build on its achievements the high degree of political awareness and participation of its citizens, an advanced level of social sector development, and a wellformulated service delivery policy under implementation. Can the Kerala initiative be replicated by the other states in India? An emphasis on improving service delivery in public institutions is in evidence in some states in recent years. Andhra Pradesh has attempted to use information technology tools to modernize service delivery for greater effectiveness. AP is also in the process of improving the services delivered by departments with a large public interface. However, each state will have to design interventions best suited to its specific multi-dimensional environment. Kerala was able to achieve as much as it did because of its history and past record in human development. If the initiative taken up by the state succeeds in transforming service delivery, it will demonstrate that a structured, well-designed policy is an essential pre-requisite for improving service delivery outcomes.

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