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Some suggestions




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Now this is quite un-original but T.R.Gopalakrishnan has some very
interesting
suggestions at

http://www.the-week.com/99mar14/events7.htm

Just in case someone needs incentive to actually read the column, here
are
the main suggestions :

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1. Pay and perks of legislators should be fixed as a multiple of the
national
per capita income.That way they will have an incentive to raise the per
capita
income.

2. Abolish the post of governor and sell off the Raj Bhavans as heritage

hotels. Besides the immediate savings, it also promises income in the
future.

3. Why have two houses of Parliament. Is the upper house providing any
service
at all, let alone any service of value. Savings in the cost of
maintaining
this useless house and its useless politicians will be considerable.

4. State governments seem to have hit upon the idea of creating new
districts
to generate employment. Imagine the savings if states were to merge
districts
and cut down on the total.

( I think this applies to creation of new states too ! -Pankaj )

5. There should definitely be a legal cap on the number of legislators
who can
be made ministers or be given other sinecures at the cost of the
taxpayer. Say
20 per cent of the strength of the party in power.

6. Make the budget presentation a once in two years affair. That way,
industry
will be able to plan ahead, and escape the uncertainty that each budget
generates. There will be administrative cost savings too.
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Funny how one finds thoughts similar to one's own sooner or later. I was

thinking of the first suggestion more in terms of linking salaries
of all government employees to productivity. Now this includes
legislators
as well. As in corporations, the higher up an employee is, the more his
salary
should be linked to quantifiable productivity gains. So in effect I want
a
large part of pay for public office to be "equity" related like stock
options.
Stock options work only if the stock price is good enough. More
importantly
they can be a carrot and a stick at the same time. Especially for
legislators,
one can visualise something like a reverse Dearness Allowance as a
component
of their salary ! So if the inflation rate goes up, their salaries go
down (
at least some ). One could think of bonuses too for reaching milestones
like
levels of literacy or number of new jobs created etc. There have to be
lots of
positives for the "employees" to want this to work. And I really want
the
bonuses to be large enough to be real incentives. I cannot see why the
Prime
Minister should not make a few crores if the GDP growth rate goes up by
1
percent ! This could work for State Governments too with the right
economic
indicators ( like Electricity Board collections :) ). Yes, if someone
wants to
put it that way : I want to legalise corruption ! But that's a negative
view
of a real solution.

Clearly the idea is very new and I don't know if any nation does
anything of
the sort right now. I am aware that in India all the figures are fudged
anyway
but that does not mean the idea itself is bad. Now I am not an economist
but
as a lay-person cannot see any reason why this cannot be implemented.
The plan
should not be too complicated and should encourage transparency like we
can
see how much the CEO of a company made, in the Annual Report.

Basically the idea is to make it worthwhile for people like you and me
to want
to get into politics. If people really want to be dishonest, they can be

dishonest anyway but this way there is less need for them to be so.

Pankaj



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