Immediately following the Uva PC elections, I published an article in this column arguing that good governance, despite serious set-backs in recent years, still matters in the country from the point of view of the wider population. In fact, it is the issue of good governance that has given rise to a broad-based opposition to challenge the incumbent President.

The value of good governance and rule of law for any country is quite obvious. Yet, there are many countries around the world where poor governance is the order of the day. In these countries, key elements of good governance are either very weak or almost totally absent. Free and fair elections, accountable and transparent government, independence of  the media, the  judiciary, and the public service, rule of law, equitable access to public resources, etc. are so critical for the effective functioning of state and non-state institutions. In the absence of well functioning institutions, citizens not only face serious hardships but find themselves in an uncertain and unpredictable environment where various decisions affecting their lives are largely determined by the undue influence of powerful political actors. These decisions may be related to the allocation of public resources, recruitment to state sector jobs, awarding of various contracts, imposition or removal of taxes, issuing and renewal of various licences, etc. Faced with an uncertain and unpredictable situation with regard to their present and future prospects, many citizens, in particular, younger and vulnerable groups cannot plan their future activities.  So, many parents want their children to leave the country and find a better place to live.  Many people who have the potential to launch business ventures tend to think twice before committing themselves to risky investments. These and similar tendencies are not conductive for sustainable and equitable development of the country.

So it is not difficult to understand why many political parties and groups with diverse ideological orientations have come together to form a common opposition alliance to face the upcoming presidential elections. They all seem to agree on one thing: the need to establish good governance and rule of law in the country. Yet, Sri Lanka’s challenges do not end there. In fact, restoration of good governance and rule of law is only a precondition, necessary to face up to numerous other challenges.

It would be not easy to agree on a set of solutions to various problems that we need to resolve in order to achieve long-term social and economic  goals of the country. But, every effort has to be made to do so.

Future prospect of the country in terms of economic and social progress as well as social and political stability would depend as much on good governance and rule of law as on how we face up to the other challenges facing the country. What are these others challenges? They can be classified into the following four areas.

a)    National disunity
b)    Income inequality and social disparities
c)    The lack of diversification of the economy
d)    Stagnant and poor social infrastructure

It is obvious that there is no national unity in the country today. Yet, this situation is not going to change as long as political parties and other sectarian groups pursue their competing and often conflicting interests without making an effort to find  common ground and working towards a shared future for the entire population. So, the country badly needs a reconfiguration of its polity to facilitate collective rather than sectarian efforts on the part of political parties that are divided on ethno-nationalist lines today.

The present income inequalities and social disparities are obviously unjust and unsustainable and need to be drastically reduced in order to create a sense of social justice in the minds of the ordinary masses. The higher income groups should obviously  pay more rather than less taxes but the taxes collected should be used to provide various forms of relief and support to low income groups and vulnerable people such as the poor, the unemployed, the elderly, the sick and the disabled. In spite of global market pressures to reduce taxes, many European welfare states maintain relatively higher taxation levels and incur a high level of public spending. The benefits of such policies are evident from the overall higher quality of life for almost everybody.

The structure of the country’s economy today is highly distorted. It is largely the financial sectors that have expanded in recent years, often at the expense of the productive sectors of the economy. Agriculture and industry have stagnated or even declined, driving people away from these activities, into the service sector. This trend is counterproductive and unsustainable. The resulting imbalance between exports and imports makes the country heavily dependent on the export of labour and private remittances.  While this does not make much economic sense, the social cost involved is weighing heavily  on a large segment of the population, in particular, vulnerable groups, such as children and women.  

And finally, the area that is as important is social infrastructure. The development of social infrastructure is important not just in its own right but as  part of an overall development and welfare strategy. The most important components of social infrastructure are education, health, public transport and social protection. While a progressive taxation policy could help reduce gross income inequalities, the same could also help mobilize considerable public finances to support the development of the social sectors.       

I have discussed the importance of each of the above social sectors in several of my previous articles in this column. So, there is no need to discuss them again in this article. Suffice is to say that revamping and strengthening the social sectors can go a long way in facilitating social and economic development, while, at the same time, improving the life chances of the lower social strata. As is well known, serious shortcomings and gaps in the social sectors have also imposed a heavy burden on low income groups. What is required in each of the social sectors is the development of sound policies, beside the allocation of adequate resources on a priority basis. Today physical infrastructure is accorded the highest priority, mostly at the expense of the social sectors such as education, health, public transport and social security. This situation has prevented us from making best use of these sectors for economic development and public welfare.

While what is outlined above  has been the main line of argument against the social and economic policies of the present regime over the last ten years, the policy makers have not shown much interest  in responding to such criticism in a positive manner. We now have to wait and see what the voters think about it.