Public sector restructuring — mission impossible!

During the past few decades, there has not been a general issue related to economic policies that had received attention, locally and globally, as has the issue of restructuring government institutions or restructuring the public sector. But what was the result at the local level?

The slogan of restructuring the public sector remained at the top of the priorities of all the governments that were formed over the past two-and-a-half decades in Jordan, without anyone daring to take the right decision towards restructuring the public sector. The most reluctant governments in this field were the ones that created a ministerial position to restructure the public sector and cancel it several times within a short period of time. Will the government of Bishr Khasawneh be able to complete the task of the public sector restructuring process during its term in the coming years?

In order for the restructuring process that was first sparked in the mid-nineties of the last century to be successful, its objectives, scope, inclusiveness and timeframe required for its implementation must be defined. The question that should be answered is “Will the restructuring process include ministries, institutions and government departments that are subject to the budget of the central government only, or will it also include all institutions, departments and regulatory bodies that are subject to the budgets of independent bodies? In my opinion, for the restructuring project to be feasible and to achieve its goals for which it was launched, it must be comprehensive and broad.

Nowadays, the focus of restructuring operations is no longer on transferring the private sector model into the public sector. Instead, it has become a matter of good governance. It is a combination of demands for more efficiency, effectiveness, quality of services, and speed of access to public service for all citizens via the Internet at low costs.

After the global financial crisis, the goal of public sector administrative reform has become to rationalise the government structure in order to improve the efficiency of the public service. When the restructuring project is mentioned, the thought goes to mergers, downsising, outsourcing key organisational activities, etc. Thus, restructuring may mean in some sectors cutting out jobs or early retirement and thus reducing public spending in order to face financial pressures in the public budget. At other times, it means rehabilitating and training the public sector workforce and implementing improvements that balance costs and quality. This is because the efficiency and effectiveness in the performance of government depends on the talent of public officials and the quality of their knowledge and skills.

In view of the high unemployment rate; 23.9 per cent in the third quarter of 2020, and the inability or unwillingness of the private sector to expand its economic activities, and given the great pressure from Parliament on governments towards hiring more workforce in the public sector, the restructuring project remained shackled and its mission was impossible and continued as a stubborn challenge before all successive governments.

There is a great opportunity for Khasawneh’s government in this direction, especially since the number of studies conducted for the purpose of public sector restructuring is very large and varied. A simple review of the economic and administrative literature in the governmental archives indicates the extent of successive governments' involvement in the issue of restructuring, but without any slightest tangible progress mentioned in this direction.

Bishr Khasawneh's government does not need to conduct more studies. Rather, it needs an economic and technical decision preceded by a firm political decision in this direction. The size of the public sector is large by all standards (34 per cent of GDP) and its efficiency is no longer admired according to international standards. And its burden on the treasury is noticeable on the current expenditures side, as it acquires 88 per cent of the general budget for the year 2021, and it is necessary to restore Jordan’s reputation in this field.