In my years of training and working with public officials in Pakistan, I have repeatedly encountered a troubling trend: budget officers struggle to calculate basic estimates, accounts’ officers unaware of national and international regulations, and auditors relying on outdated practices carried over from their predecessors. IT experts can't often comprehend basic controls or frameworks, and internal auditors operate without manuals. This pattern of inadequate skills extends across various professional roles within the public sector.
While concerning, this lack of proficiency is a symptom of a deeper issue: the lack of professionalization in Pakistan's public service. If one looks at the world, one realizes that governance practices have evolved significantly in recent decades, driven by advancements in technology, globalization, and changing public expectations. Unfortunately, Pakistan's governance has stagnated. This lag, particularly in professionalizing its public service, has resulted in a number of detrimental consequences—from struggles to meet payroll obligations to massive federal budget deficits, blatant corruption and poor service delivery.
In the past five decades, driven by a convergence of factors, the global landscape of governance has evolved dramatically. Professionalization, a cornerstone of effective public administration, demands specialized skills in officials holding professional designations, such as finance managers, accountants, auditors, IT personnel and the rest.
Policy makers and ministers talk about restructuring in the media without having a holistic understanding of the kinds of systemic issues that plague the government machinery. The evidence of its current stagnation is overwhelming with its outdated financial management policies, a lack of risk management frameworks, and widespread incompetence stemming from ill-adequate recruitment and training.
Technological advancements, including digital tools and automation, have not only digitized data storage and processing, but also enabled the production of cutting-edge reports and analyses that previously required external expertise. Additionally, globalization has fostered the adoption of professional best practices in all areas of public sector management, while changing public expectations demand greater responsiveness and accountability from governments.
The incorporation of these factors has transformed public sector governance into a more systematic and evidence-based approach, where the application of proven methods can yield significant improvements. Unfortunately, Pakistan has lagged in these areas, particularly in professionalizing its public service, adopting professional best practices, and developing a clear roadmap for digital transformation. This stagnation has hindered service delivery, fueled corruption, and widened the gap between the needs of the people and the capabilities of the government.
An analysis of Public Financial Management (PFM) in Pakistan reveals the true state of its governance. The Auditor General's 1999 New Accounting Model is outdated and confusing with its (internationally) non-compliant Modified Cash Basis of accounting. However, poorly devised as it is, even this accounting policy is not properly enforced, with potentially less than 1% of the public sector adhering to it. This alarming lack of compliance raises serious concerns about the overall state of governance. Another glaring question arises from the published financial statements of the Controller General of Accounts and provincial Accountant Generals: if asset and liability accounting is absent, which the notes of the statements declare, what accounting methods are they employing that could possibly guide 21st-century public administrators and finance managers in making informed decisions? In reality, the situation extends far beyond PFM. Risk management, a central concept in modern management, remains largely unheard of, turning decision-making into a gamble.
Federal and provincial procurement rules are as poorly crafted as the accounting and auditing policies, leaving ample room for malpractice. The incomprehensible absence of a comprehensive data governance framework hinders data-driven decision-making and exposes sensitive information. Moreover, inadequate human resource management practices, characterized by poor recruitment and training, frequently result in individuals holding professional designations without possessing the requisite professional skills for those positions.
Collectively, these shortcomings, compounded by similar issues in other areas of public sector management, have resulted in financial losses, inaccurate budgeting, operational inefficiency, rampant corruption, and a growing erosion of public trust in institutions. This systemic dysfunction has contributed significantly to Pakistan's persistent economic challenges and vulnerability to corruption.
Pakistan's governance system is at a crossroads, facing the stark choice between complete breakdown or a radical restructuring to professionalize public sector management.
The way forward for Pakistan's governance lies in professionalizing public administration and adopting internationally recognized frameworks that have been successfully used to modernize economies and public sector governance. For instance, the Organization for Economic Cooperation and Development’s (OECD) Principles of Public Administration can be adopted as actionable guidelines at the highest levels of government. From there, these principles can cascade downwards to influence even the smallest administrative units. Similarly, the Committee of Sponsoring Organizations of the Treadway Commission's Enterprise Risk Management Framework (COSO ERM) is a comprehensive risk management tool. If adopted, it could enhance the efficiency of Pakistan’s public sector at every level and improve their ability to anticipate and respond to risks.
Furthermore, the Government Accountability Office (GAO's) Green Book, detailing practical applications of COSO ERM, could help the public sector improve its budgeting, financial reporting, and resource utilization. The Orange Book, which emphasizes risk management and assessment, could help strengthen Pakistan's internal audit function and improve accountability and transparency. Similar international standards and guidelines exist for formulating procurement rules, data governance frameworks, IT control policies, and other areas of public sector management. By embracing these globally recognized best practices, Pakistan can leverage the collective wisdom and experience of other nations to overcome its governance challenges and achieve its development goals.
Pakistan's governance system is at a crossroads, facing the stark choice between complete breakdown or a radical restructuring to professionalize public sector management. Policy makers and ministers talk about restructuring in the media without having a holistic understanding of the kinds of systemic issues that plague the government machinery. The evidence of its current stagnation is overwhelming with its outdated financial management policies, a lack of risk management frameworks, and widespread incompetence stemming from ill-adequate recruitment and training.
This systemic dysfunction has yielded tangible consequences. Yet, the path to a brighter future is not elusive. By embracing the proven strategies of professionalization, adopting internationally recognized frameworks, and leveraging the wealth of global best practices available, Pakistan can transform its governance landscape. The time for decisive and professional action is now. Pakistan's economic stability, social development, and the well-being of its citizens hinge on its leaders’ ability to modernize its governance system and bridge the gap between aspirations and reality.