The Hindu Business Line : Leave development to private sector, says Narayana Murthy

Mr N.R. Narayana Murthy, Chairman and Chief Mentor, Infosys Technologies, with the Deputy Chairman of Planning Commission, Mr K.C. Pant, at the 21st Pandit Govind Ballabh Pant Memorial Lecture in the Capital on Saturday.

NEW DELHI, June 28

How about private companies running primary schools, healthcare centres, housing colonies and ration shops? And the Government just sticking to handling things such as defence, security and conducting elections?

This may sound far-fetched, but Mr N.R. Narayana Murthy, Chairman and Chief Mentor of Infosys Technologies, believes that the Government should lay its hands off all economic activities and let the private sector handle such work.

"The first step in this process (to ensure progress and development) is to phase out the role of the Government in all economic activities. The inefficiency of our public sector reiterates the need for this," Mr Murthy said delivering the Govind Ballabh Pant memorial lecture here.

He cited the inefficiencies in the Government-controlled sugar industry where profits had fallen by 18 per cent and aggregate net losses touched Rs 95 crore. As against this, when private sector took over the distribution of power in Delhi, load shedding has come down by 15.9 per cent, while consumption increased.

"All developmental activities for the common man such as education, healthcare, shelter and food distribution should be handled by reputed private sector institutions. It should be a competitive market in order to prevent the formation of monopolies. The contribution of the Government should be by way of vouchers, which should redeemable at any these private sector institutions," Mr Murthy suggests.

Since the vouchers cannot be traded with that of any other sector, it would ensure that the money is used for the intended purpose only. Consequently, people will have the freedom to obtain the best value for money from competing players in the field.

The Government should have direct control over defence, security, conducting elections, law and order, e-governance, regulator functions, foreign relations, space research and external trade.

In the case of project-based activities, the Government has to take up conception, design and even running them, but in most cases, the private sector should be given the charge of implementation.

Also, they should be entrusted with maintenance and upgradation of the facilities provided by the Government to the citizen.

Mr Murthy said successive governments had failed to raise India to the levels of developed countries because of lack of management talent in administration.

Legacy mindset of pre-independence bureaucracy, lack of meritocracy in the system and `intellectual arrogance' of administrators have dragged the growth of the country.

In order to bring about more efficiency in the system through adoption of management practices, civil servants should be trained in management and top rankers from the Indian Institute of Management (IIM) and other reputed schools be hired by the Government.

Besides, salary of civil servants must be made performance-based.

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