Why a fit-for-purpose public service is key for investment retention

By Phyllis Wakiaga

The public service is the world’s largest service provider. Any enhancement of public service delivery impacts the lives of millions of people. Like any other service provider, understanding customer needs should be the core of service delivery. This means having a productive public administration and management system, which is designed to attract investments and boost local investors’ capacity to compete in the global market.

A drive for competitiveness is central to investment attraction. Public service efficiency is at the heart of competitiveness as it influences the cost of doing business in a country. Government efficiency can be enhanced by modernizing public service delivery capabilities and incorporating feedback from the business community and public. An integrated and connected Government will unlock the effectiveness and efficiency of public service.

The manufacturing sector, for example, has a goal to increase its contribution to the GDP from the current 9.2% to 15% by 2022. In order to do this with the entire economy growing simultaneously, it means that the sector should plan to grow at over 30% per year! Now this is not an impossible feat to achieve, however it is quite ambitious given that the current growth rate per year is not even close to double digits. The highest registered growth rate was in 2010 at 5.8% whilst the lowest was in 2012 at 0.6%. Last year the average growth rate was 2.2%. So whilst it is not inconceivable to want to grow the industry at this rate, it means a recalibration of business-as-usual and a deliberate campaign to foster political will, as well as cohesion among policy-making agencies and institutions of government towards this goal.

Good governance is the most critical aspect of public service delivery. One function of good governance is to ensure that that entities in the public service act in the best interest of the public at all times. This entails a strong commitment to integrity, ethical values, rule of law, transparency and comprehensive public participation with clear reasoning for decisions made in order to demonstrate that the results will be in the public’s best interest. Public participation is at the heart of public service delivery and should be structured in such a way that it is responsive to the citizen’s needs.

The current budget deficit quagmire that the country finds itself is an indicator of a huge disconnect in the public service delivery system. Taxation policies should be developed with an aim to nurture and grow local business, to create shared value and consequently enable the Government to effectively deliver public service. However, as it stands currently, the tax base has not been widened to increase the revenue collection bracket for government. Rather what happens routinely is the continued over-taxation of few companies that have formalized, leaving out a huge informal sector with the potential to bring in the desired revenues for growth.

I must add, it is not that companies in the informal sector do not want to formalize, but that existing conditions for formalization are presently not accommodating to small businesses yet to break even or take shape. Making the conditions for formalization nurturing and conducive is also a critical function of a fit-for-purpose public service; to create an environment that makes them productive enough to be able to formalize. Subsequently they too shall be able to pay tax and contribute towards reducing the country’s budget deficit.

Still, even those that are formalized and paying their taxes are not incentivized to expand their business operations and are uncertain about future prospects of operating in Kenya. Many are frustrated by unfavourable and complex regulations that are a symptom of a disarticulation between our country’s ambitious economic goals and the execution of policies that seem to drive us in the opposite direction.

Duplication of institutions is a big challenge in public service with a huge impact of cost and ease of doing business. A fit for purpose public service must deliver better regulation to reduce the cost and administrative burden on business. Long term thinking in policy development enables businesses to plan for the long term and makes for an attractive investment destination.

Public service must also provide value for money and ensure prudent utilization of citizen’s resources. One way to achieve this is through collaborative partnerships and shared services. There is need to revisit the 2013 Parastatal Taskforce report and implement some key recommendations to reduce duplication and overlaps.

Connectedness of public service is critical in driving a common vision or purpose. A connected Government according to a PWC report by the Public Sector Research Centre is not just about Government restructuring. It calls for implementation of a common vision supported by integrated objectives, outcomes, information and process flow.

The Big 4 Agenda provides an opportunity for renewed commitment to a common vision. Synergy must be seen in implementation of the Big 4 by breaking down internal silos and building a connected Government.