Analysis by Dr. Lim Teck Ghee on “Civil Service Reform” (updated)

 
The recent announcement by the PM that the Government will act to recruit the best brains for the civil service is a clear admission that the government has failed to practice merit-oriented recruitment in the past, and that the performance of the civil service has suffered as a result.  The public, however, is cynical about promises of reform and change which do not produce results.  
The PM would do well to set up time-lines and bench marks for these and the other reforms that he has recently announced.  If little or no progress is made on them, the PM can be sure that he will be made accountable at the next elections.  To monitor these civil service reforms – and this should include extending them to the universities and reducing the emoluments for the public sector which the PM has noted is a staggering sum,  – I suggest that the PM posts them on his blog and prepares a half yearly  report on the progress in implementing them. This monitoring – made transparent to the public – will help convince many skeptics, including myself, that the PM is serious about bringing change and not simply engaging in political rhetoric.
 
The subject of our bloated public sector also merits special attention. It has long been obvious that the size of our civil service needs to be reduced at all levels. The table below puts into better perspective how bloated our civil service is by regional standards.

Our civil service is three times larger on a per capita basis than the Laotian one.  Compared with Thailand, Indonesia and the Philippines, we are overstaffed by more than 50 percent.
 

Civil Servants    
Workforce Population*
 		CS as % of Total Population
 Indonesia  3,928,658  219,883,000  1.79
 Laos PDR    70,354  5,657,000  1.24
 Philippines  1,445,498  79,999,000  1.81
 Thailand  1,296,688  62,833,000  2.06
 Malaysia  899,250  24,425,000  3.68

                   
* Pop as at 2003, UN estimates

Source:  UN Online Network in Public Administration and Finance, 2004

I hope the alarm bells on the issue of the size of our civil service are not ignored by the Prime Minister.  Public sector wage bill as % of GDP; number of government employees as % of total population; recruitment growth rate, etc.- these need to be monitored and assessed on rational non-politicized cost and benefit analysis.  Government should realize that in order to deliver quality services, it will need to spend money on goods and services, and not merely on salaries.  What is the point of increasing the size of the civil service when non-wage public expenditure such as goods, operations and maintenance, capital expenditure, etc are squeezed?  Unfortunately, the Government is continuing to give the impression that it is “an employer of last resort”.  There may be a case for selective increase in some strategic sectors but overall we need a considerably leaner, more efficient and productive civil service.

Finally, in terms of civil service reform, there are two important concurrent reforms that need to be carried out which the PM has missed out on.  One is the need to ensure that the civil service is politically neutral and is not made use of by the ruling party for its partisan political interests.  
The other is to bring about a better racial balance in the civil service at all levels, especially at the level where there is direct interaction with the public.  A more representative civil service also needs benchmarks and time lines to make sure it happens.  Otherwise, we will be back to square one in terms of the unhealthy racial representation in the civil service.  In this respect, it is not the lower salary scale compared with the private sector that has deterred non-Malays to shy away from the civil service.  More structural reasons and concerns that they are discriminated against or are not given equal and fair opportunity for mobility are the main reasons for the low level of non-Malay recruitment.  This is a serious problem which the BN parties have failed to address in the past. The recent non-Malay voting patterns indicate that if the BN continues to ignore this issue, it will be to their own peril in the next elections. 
Kuala Lumpur, 29 April 2009
 

Updated 30 April 2009:
 
Further Comment by Dr. Lim
 Thanks to the readers who have requested for comparative data on Singapore’s civil service.  According to a recent “The Edge Singapore” report (20 March 2009), Singapore has a total of 60,000 civil servants presently.  Singapore current population is 4.6 million which means that its civil service comprises only 1.5% of the total population.  Compare this with Malaysia’s figure which is approaching close to 4% of the total population, and it is clear that the term “bloated” is an inadequate description of our civil service. One reason why the Singapore figure was not included is that our political masters do not appreciate comparisons with our island neighbour, and to avoid any impression that the writer is less patriotic or may have some hidden agenda.

The size of our civil service is important not least because all Malaysians – especially tax payers – are paying their wages.  Total emoluments (salaries and allowances) for the Malaysian civil service grew from $32 billion in 2007 to $41 billion in 2008. This expenditure takes up the major part of our public expenditure bill.  It is likely to balloon in the years ahead. Whilst the trend has been for the contraction of the civil service in many countries, Malaysia has gone the opposite way.  Whether this is prudent or irresponsible economic management and whether it should be continued as national policy needs to be discussed and put in the public limelight. 

 

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