Need for long-term policy changes | Daily News


Need for long-term policy changes

The year 2015 was yet another lost opportunity for Sri Lanka to find a way out of the pervasive and deep rooted economic, social, cultural, environmental and political issues facing the country over several decades. Liberal and social democratic forces came together in 2015 to find a way out of the tragic economic and social conditions created by successive neoliberal regimes that came to power after 1977 against a backdrop of a permanently divided society created in Sri Lanka after 1956 through series of shortsighted State policies in such fields as education, culture and language.

Despite very high public expectations, the regime that came to power in 2015 did not embark on a sound programme of economic, social and political reconstruction. This became quite evident when the first Cabinet of Ministers was appointed following the 2015 parliamentary elections. I published an article in an English daily soon afterwards entitled “Scattered Government” and pointed out that government had embarked on a disastrous journey. The rest is already history and we all know now what I said then turned out to be true.

It is natural for societies to undergo change due to endogenous and exogenous factors. In modern societies, such change is not allowed to unfold on its own as people wish to guide the processes of change in keeping with widely shared values and aspirations. This is done through well formulated State policies and other institutional interventions. This is not rocket science and there are many countries across the world with considerable experience in this regard and they have achieved a great deal over the years accruing really tangible benefits to all citizens, in particular vulnerable segments of society.

However when this is not done, many negative trends emerge leading to adverse consequences and many people continue to suffer. This is what we have witnessed in Sri Lanka over the last seven decades after political independence. This is not to suggest that there have not been any positive developments during this period. For instance, import substitution industrialization since the late 1950’s helped the country to diversify the economy away from rural agriculture. On the other hand, the lack of timely interventions to address issues arising out of even such positive developments led to intractable problems such as low productivity and poor quality of products that made them uncompetitive in the face of subsequent market competition.

Social and economic issues

Overall, Sri Lanka’s failure to manage long-term change to avoid undesirable consequences led to serious economic, social, cultural, political and environmental issues. On the other hand, timely and far sighted interventions would have helped avoid many such issues. Yet, the lack of any long-term policy coherence or consistency over time aggravated social and economic issues such as poverty, inequality, deteriorating public services, social unrest, rural urban disparities, ethnic violence, crime, corruption, lawlessness, environmental degradation and epidemics.

The whole range of issues mentioned above created an urgent need to develop sound, evidence based policies and revamp and strengthen hundreds of State institutions that were established after independence to implement such policies and programmes. But, successive governments and their myopic, mediocre and often corrupt leaders never bothered to take such measures. Instead, almost all institutions were used for narrow political purposes like giving influential and lucrative positions to friends, political loyalists and family members and diverting public resources for private use. Instead of creating equal opportunities in education, livelihoods, access to social benefits, government construction contracts and employment, political leaders in power allowed or even sanctioned such public resources to be allocated through patron client networks connected to ruling parties.

In the process, State institutions deteriorated and often became dysfunctional. Many citizens who were denied their legitimate rights became disillusioned and frustrated. Such obvious instances of social injustice prepared the ground for violent political uprisings from time to time.

Political violence

Political violence largely arising out of perceived and real social injustice has had many adverse consequences such as the diversion of scare public funds for strengthening national security, mass exodus of people directly and indirectly affected by violence and decrease in FDI due to political instability.

The circumstances outlined above has not been conducive for sustained economic development. Persisting economic stagnation has not helped build up adequate government revenue to be used for critical social and economic investments. This situation has had two very significant implications. Firstly, there has been grossly inadequate public investment in such critical areas as health, education and public transport. The result is a steady deterioration of conditions in these three areas, and we know how low income groups have been seriously affected by poor quality services. The situation has become worse when higher income groups steady moved away from such services and began to rely entirely on private services.

The lack of adequate public finances has prevented significant investments in Research and Development which is critically important for economic development and industrialization. East Asia’s rapid industrialization in recent years has been greatly aided by high domestic R&D investments, besides other factors. The situation in Sri Lanka has been dismal in this regard. While public investments in this area has been negligible over the years, there has been any diversification of industrial production as a result. Continuing exodus of highly skilled scientific personnel has also been a major obstacle to development of scientific capacity in the country.

Productive sectors

Even a casual observer of the economic scene in the country is sure to notice to gross neglect of the productive sectors of the economy. Both agriculture and industry have suffered serious setbacks over the years. This is also clearly evident from the continually widening trade gap which is so large that it absorbs about 70 percent of the remittances sent by poor Sri Lankan workers employed overseas. But, the elites in this country, i.e. political, business, military, bureaucratic, professional, intellectual, religious, etc. have not shown any restraint in their consumption of imported luxuries like fancy motor cars, household appliances, luxury housing and smart phones. Meanwhile, as the household income and expenditure surveys conducted by the Department of Census and Statistics clearly show, the lower 50 percent of the income earners in the country continue to struggle to meet the basic needs of their families.

This cannot surprising given the high costs involved in education, health and transport in this country today. But, successive governments have been totally incapable of arresting these trends.

What is presented in this article is relevant for political debates that are sure to take place in the next few weeks in view of the forthcoming Presidential elections. Yet, populist politicians who have been largely responsible for the present state of affairs are unlikely to discuss these issues in terms of public policy failures. Yet, right thinking citizens in this country should ensure that politicians do not gloss over important national issues in the run up to a crucial election.


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