Financial Times

Changing priorities and needs
Economy, governments and national planning
The need for national planning in efficiently operating various aspects of the Sri Lankan economy has never been as important as it is now. Sunil Karunanayake, our regular columnist on corporate and macro-economic issues, tells you why.

My last week's article on "Maturity of the Sri Lankan Economy" did arouse some interest and reaction. One popular sentiment is the credibility of the national economic indicators and it's relationship to real life living, this is a debatable issue and has been even challenged in Singapore, the other is the aspect of national planning by the government.

Today Sri Lanka is wilting under pressure of inadequacy of major infrastructure facilities such as roads, transport, schooling and health sector needs. Roads are congested, hospitals overcrowded and schools without proper facilities have created frustration and hopelessness among people. Perhaps years of civil war and the continuing political power struggles has pushed the importance of national planning to a back seat.

Planning is an essential element in a civilized society. Leaving governance apart, every aspect of whatever we do in our daily lives need some degree of planning to accomplish the goals. The big picture is the national planning which plays a key role in the economic growth of a nation and the physical quality of life of its citizens.

In Sri Lanka the first ever-national planning commission was set up in the early post independence era with eminent economist Dr Gamani Corea as it's first secretary under the chairmanship of then Prime Minister S. W. R. D. Bandaranaike.

Dr Corea later on became the permanent secretary of the Planning Ministry, which handled the nation's capital budget. Then during the tenure of Prime Minister Dudley Senanayake a National Operations room was set up to monitor capital projects. However with the advent of the free market economy the government planning aspect was given low priority.

Of late we note with satisfaction the creation of a web page under the supervision of the President to monitor the projects. Sri Lanka has lost many years of modern history to war and conflict and is now struggling to stage a recovery. The importance of national planning is felt now more than ever before.

Today the country is facing a major crisis on meeting rising global oil prices, it is reported that more than 50% of the fuel imported is consumed on generation of electricity. This is not an overnight development. For many decades successive governments did not give due priority to this issue, water resources were neglected, proposed coal power plant a viable alternative for power generation has been spoken of and debated for well over a decade but nothing constructive has happened to date resulting in economic hardship to all.

The lack of planning and shortsightedness was clearly visible through the recent measures adopted to conserve fuel and foreign exchange reserves through high tariffs for import of motor vehicles of all categories with more hardships on middle class than the high spenders on luxuries not suitable for our roads.

Lack of city planning has resulted in unending traffic congestion, loss of productivity and waste of fuel at an enormous cost to the taxpayer while two other vital sectors health and education is no exceptions.

There is a lot to learn from the developed world. In the USA the National Capital Planning Commission (NCPC) is responsible for the development of it's capital. The 12-member commission includes five citizens with experience in national/regional planning appointed by the president; the secretary of Defence is an ex-officio member. This commission undertakes a variety of planning initiatives to guide growth and development to cater to increasing needs under the theme of " Planning America's Capital for the 21st century.

In Singapore the Ministry of National Development is responsible for national land use development and planning to guide Singapore's physical development to bring about economic and social progress. This covers public housing, urban redevelopment, and adequate supply of fresh food for people, parks and conservation of nature.

Closer home in India the National Planning Commission functions under the leadership of Prime Minister Manmohan Singh along with several Cabinet ministers. The commission reviews key sectors of the economy such as health, energy and rural development.

There's no doubt that these policies have helped these countries to be in the forefront of economic prosperity and eradicate poverty as against most Third World countries with little or no planning who spend much of it's resources for poverty alleviation thus taking them through a vicious circle of poor productivity and poverty.

It 's time that government gives highest priority to the setting up an apex national planning body by taking a few lessons from the developed countries. It is no different to the business world now driven by strategic planning, vision, mission, goals and targets etc.

(The writer could be reached at suvink@eureka.lk)

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