Last week’s ar­ti­cle linked the need for struc­tur­al change in T&T’s econ­o­my to dig­i­tal­i­sa­tion. It al­so out­lined the cen­tral­i­ty of the Gov­ern­ment’s in­sti­tu­tion­al frame­work in pro­vid­ing the per­mis­sions and li­cences, which com­prise the op­er­at­ing sys­tem that makes a so­ci­ety func­tion. It al­so not­ed that the op­er­a­tional ef­fi­cien­cy of a so­ci­ety de­pends on how well this in­sti­tu­tion­al frame­work func­tions. This ap­proach ar­gues that all of “gov­ern­ment” must op­er­ate more ef­fi­cient­ly to fa­cil­i­tate the emer­gence of this struc­tur­al change.

This ar­gu­ment has a sound method­olog­i­cal ba­sis. The 2018 IDB Study “BUILD­ING CA­PAC­I­TY IN THE CARIBBEAN: The State of the Civ­il Ser­vice in Trinidad and To­ba­go” ap­proach­es this point from an in­sti­tu­tion­al per­spec­tive. It starts from the pre­sump­tion that the ef­fi­ca­cy of pub­lic pol­i­cy and the ser­vices pro­vid­ed by the State is close­ly linked to the qual­i­ty of its Civ­il Ser­vice. To para­phrase, no pol­i­cy will be ef­fec­tive if the Civ­il Ser­vice de­liv­ery sys­tem is not equal to the task.

The study ar­gues that the way that the Civ­il Ser­vice is man­aged, its hu­man re­source plan­ning, man­age­ment, se­lec­tion, pro­fes­sion­al de­vel­op­ment and in­cen­tivi­sa­tion are “crit­i­cal con­di­tion­ing fac­tors when it comes to at­tract­ing, re­tain­ing and mo­ti­vat­ing suit­able staff” to ef­fect these tasks or poli­cies. The study as­sessed 38 crit­i­cal points and scored each area out of 100 to ar­rive at an ag­gre­gate score for the T&T Civ­il Ser­vice as a whole. A score be­tween 0-39 was con­sid­ered as low, 40-59 as medi­um and 60 and above was con­sid­ered high. The re­port con­clud­ed that the av­er­age grade for T&T was 42, just three points above the low grade in­di­cat­ing that im­prove­ment is re­quired.

But the score of 42 is an av­er­age of the highs and lows. Of the sev­en qual­i­ty in­dices list­ed, five in­dices were be­low 40 with two scor­ing 53 and 80 points re­spec­tive­ly. Of the eight HR sub­sys­tems eval­u­at­ed, six scored 40 and be­low, two of which scored 20. On­ly two ar­eas scored above 40 one at 47 and the oth­er at 53. The av­er­age of 42 is there­fore very flat­ter­ing and ab­solute­ly mis­lead­ing as on­ly four of the 15 grades were ac­cept­able.

The re­port not­ed that the least “ma­ture” (mean­ing weak­est) in­dices were Ef­fi­cien­cy and Struc­tur­al con­sis­ten­cy. The Ef­fi­cien­cy In­dex eval­u­ates how staff are de­ployed rel­a­tive to cap­i­tal ex­pen­di­ture. The Struc­tur­al Con­sis­ten­cy in­dex refers to how well the Civ­il Ser­vice was in­te­grat­ed. Both ar­eas scored 28 out of 100. The HR sub­sys­tems of Work Or­gan­i­sa­tion and De­vel­op­ment Man­age­ment are the least ma­ture (weak­est) ar­eas, scor­ing 20 out of 100.

The re­port on­ly fo­cus­es on the peo­ple man­age­ment as­pect. To be ef­fec­tive, or­gan­i­sa­tions must be man­aged from three per­spec­tives–peo­ple, process­es, and sys­tems as in the Bal­anced Score­card ap­proach. For an or­gan­i­sa­tion to be ef­fi­cient, the three ar­eas must be in align­ment. The IDB study makes im­por­tant rec­om­men­da­tions that could im­prove “peo­ple man­age­ment” in the Civ­il Ser­vice. But even if the rec­om­men­da­tions are adopt­ed, they will have lit­tle im­pact if the sys­tems and process­es are not al­so re­viewed and har­monised.

Dig­i­tal­i­sa­tion is crit­i­cal to in­no­vat­ing and im­prov­ing the de­liv­ery and qual­i­ty of the “gov­ern­ment’s op­er­at­ing sys­tem,” to fa­cil­i­tate struc­tur­al trans­for­ma­tion. But dig­i­tal­i­sa­tion will on­ly work if the sys­tems which un­der­pin the de­ploy­ment of the op­er­at­ing frame­work are im­proved. Build­ing on a weak or un­sta­ble base could lead to un­pre­dictably bad out­comes.

A clas­sic case is the Min­istry of Le­gal Af­fairs (MLA) which in­tro­duced on­line fil­ings dur­ing the COVID pan­dem­ic lock­downs. The sys­tem was, and still is, grid­locked–re­quir­ing mul­ti­ple fil­ing amnesties. Con­flict­ing di­rec­tions are giv­en by dif­fer­ent staff to the pub­lic re­sult­ing in mul­ti­ple in-per­son vis­its to clar­i­fy the pro­ce­dure. The re­cent im­po­si­tions on­ly ex­ac­er­bate an al­ready over­heat­ed op­er­a­tion. Fil­ing a sim­ple an­nu­al re­turn should not re­quire more than the cost­ly ap­point­ment of a pro­fes­sion­al firm to ef­fect the fil­ing.

Ad­di­tion­al­ly, all di­rec­tors (small fam­i­ly-run busi­ness­es al­so) are re­quired to have sep­a­rate email ac­counts, as well as sep­a­rate on­line fil­ing ac­counts–and the process for both ap­ply­ing and re­ceiv­ing ap­proval for the lat­ter is as grid­locked and in­ef­fi­cient as the sys­tem it­self. What is worse is the penal­ties for late fil­ing are oner­ous. And what of the lit­tle peo­ple who have no ac­cess to email and need birth cer­tifi­cates et al?

The FIU know-your-cus­tomer (KYC) guide­lines and de­f­i­n­i­tion of po­lit­i­cal­ly ex­posed peo­ple are al­so ar­eas of over­reach. The Cen­tral Bank Gov­er­nor’s re­cent com­ments sug­gest that he un­der­stands this. But the CBTT in­spec­torate con­tin­ues to di­rect fi­nan­cial ser­vices firms (in­sur­ance com­pa­nies, bro­kers, fi­nance com­pa­nies etc) to re­quire di­rec­tors of com­pa­nies re­new­ing in­sur­ance poli­cies or buy­ing com­pa­ny ve­hi­cles to give per­son­al de­tails. This cre­ates an in­cred­i­ble pa­per mound that goes in­to un­ac­tioned files at FIU/CBTT serv­ing no use­ful pur­pose as the in­for­ma­tion is al­ready cap­tured by the MLA reg­istry sys­tem.

Vo­lu­mi­nous es­ti­mates of sus­pi­cious ac­tiv­i­ties are re­port­ed in the me­dia. But where are the suc­cess­ful (or any) pros­e­cu­tions for mon­ey laun­der­ing? The de­ploy­ment of the KYC guide­lines re­flects the poor work or­gan­i­sa­tion and struc­tural­ly in­con­sis­tent ap­proach­es iden­ti­fied in the IDB study. They im­pose per­va­sive but in­ef­fec­tive pa­per-based re­quire­ments that on­ly cause anger and angst among the cit­i­zen­ry. In ma­jor fi­nan­cial cen­tres, fi­nan­cial in­sti­tu­tions with sim­i­lar KYC guide­lines don’t get any­where close to the lo­cal de­mands.

Dig­i­tal­i­sa­tion re­quires a lean and co­or­di­nat­ed sys­tems ap­proach.

Mar­i­ano Browne is the Chief Ex­ec­u­tive Of­fi­cer of the Arthur Lok Jack Glob­al School of Busi­ness.