As an institutional innovation, the Finance Commission model has four clear
advantages for the management of large government bureaucracies. First, it is
professional and meritocratic. Even though political views and opinions of the
members cannot be avoided, by and large the chairman and members are
professional experts well-known for their expertise and independent approach.
Second, the workings of the commission are transparent. By consulting different
levels of government, academics, think-tank experts, civil society and even students,
whose views are on record and published, the commission is able to improve the
social debate on some complicated and controversial issues that deserve more open
discussion, without the debate being politicized.
Such transparency improves the quality of discourse and academic standards,
because the university and professional communities are able to access more
information and knowledge about how the government works and provide good
feedback on the complex issues involved.
Third, the process of the commission’s work improves accountability and the rule of
law in due process. The government (and the politicians) know that they will get the
best professional and scientific advice they can get, properly consulted with good
feedback on the different options available, including valuable domestic and
international experience. It helps the rule of law, because when future tax or policies
are implemented and disputed, the courts will have public records of the policy
debate and the thinking behind such tax rules or regulations.
Fourth and perhaps from the political process the most valuable option, there is
deniability. The government does not have to accept all the recommendations of the
commission. It has the option of choosing what it feels is politically acceptable and
implementable. All it has to do is to explain why it made a particular choice of policy
direction.
A relatively closed-door debate over the various issues means that if the policies turn
out to be faulty, the government cannot deny that it alone made the decision.
Whereas if the policy was a recommendation from a commission of independent
experts, the government can say that it was done with the best available advice and
information.
There is no doubt that the competition for growth and development between China,
India and Indonesia will drive innovation and new avenues of change to Asia. The
Asian region has much to learn from each other’s strengths, experience and also
mistakes. Asian institutional innovation, many of which were borrowed from
elsewhere, has helped innovation and growth across the board, to the benefit of all.
Andrew Sheng writes on global issues from Asian perspectives.
A version of this article appeared in The Star Online, 14 March 2015
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