ECONOMIC AND DEVELOPMENT ISSUES
The trouble with our times is that we have too many amateur brain surgeons
Every country has its share of amateur brain surgeons. But we, in this country have far more than our fair share of them, especially when it comes to tackling economic and development issues. Given this fact, it is hardly surprising that the country is awash with public sector projects that are bedevilled by massive cost and time overruns

By Kaleem Omar

Islamabad is full of so-called experts. They even have an Experts Advisory Cell, housed in a building near the gleaming white blocks of the Pakistan Secretariat. What advice this cell tenders is another matter, however. If the people who work in the cell were to publish a list of the various pieces of advice they have offered to successive governments over the years, my guess is that it would be a very short list indeed. Yet there they sit, this battalion of experts, in their plush air-conditioned offices, shuffling files around day after day, week after week, month after month, year after year, decade after decade.

The Experts Advisory Cell is not alone in this, of course. Numerous other departments, ministries and government agencies are chock-a-block with experts. Indeed, some of these outfits have so many experts on their payroll that they tend to trip over one another as they leave their offices to go home at the end of the day. Wags say the rumbling sound heard in Islamabad in the evening is not thunder over the Margalla Hills but the tramp of legions of experts changing shift.

An old adage says that too many cooks spoil the broth. This adage has been given a new twist in Islamabad, where downsizing has become a dirty word and where reforms are taken to mean a licence to add more experts (i.e. more amateur brain surgeons) to the payroll – at a cost that, in some cases, runs into millions of rupees per year per expert when one adds up the cost of their salaries, perks and other privileges.

With so many so-called experts cluttering up the works and getting in each other’s way, it is not surprising that the country is awash with public sector projects that are bedeviled by massive cost and time overruns. Indeed, there is hardly any public sector project today that is completed within its original estimated cost or within its original time frame. The upshot of all this is that billions of rupees a year of taxpayers’ money goes down the drain every year, resulting in a growing gap, in real terms, between government revenue and government expenditure and keeping the country perpetually enmeshed in budget deficits.

The only surplus budgets this country has ever had in its sixty-year history were the two budgets presented by Prime Minister Liaquat Ali Khan’s government in fiscal 1948-49 and fiscal 1949-50. All the budgets since then have been deficit budgets, resulting in an ever-growing burden of domestic and foreign debt.

During the days of the British Raj, the government prepared a scheme in 1921 to build the Sukkur Barrage on the River Indus. The scheme was the biggest public sector project of its day in the whole of India, with an estimated original cost running into many crores of rupees. After the project was completed in 1931 and all the money spent on it over a ten-year period was added up, it was found that the actual cost had exceeded the original estimate by a mere 212 rupees. And, no, this figure of 212 rupees is not a misprint!

In the last 35 years, there hasn’t been a single public sector project of any consequence that has come even remotely close to having been completed at a cost that was almost exactly the same as its original estimated cost. The question is: If a project like the massive Sukkur Barrage could be built back in the 1920s without any cost overrun to speak of, why is it that today’s public sector projects invariably involve massive cost overruns? Would anybody in the government – anybody from the legions of experts that infest Islamabad like a swarm of locusts – care to provide an answer this question?

When a scheme to build the Bolan Medical College Complex in Quetta was proposed in the mid-1970s, its cost was estimated at Rs 70 million. By the time the project was completed in the mid-1980s, some five years behind schedule, it had ended up costing more than Rs 700 million – ten times the original estimated cost.

When a Karachi-based private company submitted a proposal to the Port Qasim Authority in the early 1980s for building a container terminal at the port, the cost of the project was estimated at Rs 2,300 million. PQA rejected the proposal and sat on the scheme for ten long years. It eventually awarded the contract to another company in the early 1990s. By that time it’s cost had soared to more than Rs 4,000 million.

In the early 1990s the Civil Aviation Authority awarded a contract to a French construction company to build the Jinnah Terminal at Karachi Airport at a cost of Rs 5,000 million – twice as much as the cost estimate that had been prepared by the state-owned National Engineering Services of Pakistan (NESPAK). The terminal eventually ended up costing over Rs 6,000 million. As if this weren’t bad enough, the French company then put in a claim for another Rs 500 million. The dispute was referred to an arbitrator. The CAA lost the case and had to pay the company’s claim.

Examples of such overruns are now legion, so much so that massive cost and time overruns on public sector projects are the rule rather than the exception. It’s almost as if cost and time overruns have now become almost a law of nature. Will this sorry state of affairs ever change? Or are we now doomed to be saddled with more and more so-called experts who specialise in making a mess of things and expect a pat on the back for doing so?

Paul Valery took a somewhat different approach when he said: “The trouble with our times is that the future is not what it used to be.”

In the more mundane world of business and economics, however, time is measured on a very narrow portion of the total spectrum. Few major corporations can be counted by centuries, even though there is a privately-owned iron ore mine in Sweden that has been in continuous operation under the same firm’s name for the last nine hundred years. Such exceptions, however, prove the rule.

Careers, in business, are measured in decades and products in years. Accounts are generally payable monthly, people often work nine to five, coffee breaks are fifteen minutes, push-button phones save you seven seconds dialing time, and lasers work in nanoseconds (one billionth of a second).

Boston-based business consultant Stan Davis says in his study “Future Perfect” that isolation experiments in deep caves have shown that man’s periodicity is closer to 24.5 hours than the 24 hours into which a day is divided. The question is: What would one do with this extra half hour if it were to suddenly become available to us?

If man did not adjust his natural circadian rhythm to his culturally determined yearly calendar, then daily life would get messed up pretty quickly. In other words, the things that we chose to measure and the way that we measure them tell us lots about what we value and how we see the world This is as true for economic policymakers and development planners as it is for business executives.

In the early 1900s, roughly halfway through the industrial era in the West, US efficiency expert Frederick W. Taylor invented time management. In the industrial model of the time, a worker doing endless drudgery, where one day is just like the next and nothing changes, takes the point of view that time is cyclical, an endless repetition of events. Clock-watchers and harassed managers who have only two hours to get the report out, see themselves as stationary “in” time, with the future moving toward them rather than vice versa.

Alvin Toffler, the author of “Future Shock,” expresses this perspective thus: “Future shock is the dizzying disorientation brought on by the premature arrival of the future.” The managers who prepare for next week’s conference, who launch next season’s product line, and who chart their career development take the approach that time is a one-way street that we move along; we advance toward the future, not it toward us.

As Davis notes, the business model of time in the industrial world was very much from the corporation’s perspective. The focus was on internal reorientation and actions. Even nine-to-five time, defining as it does a regularly recurring event, is from the industrial perspective of the producer, rather than the postindustrial perspective of the consumer. When the corporation focuses externally, on the customer, it transforms its sense of time.

The same principle applies to economic policymakers and development planners. In order to adopt this principle, however, what we, in this country, need to do as a necessary first step is to stop stuffing the ranks of the government with amateur brain surgeons. Unless we do so, we will continue to be saddled with massive project-cost and project-time overruns and massive budget deficits.