Administrative aspects of planning in developing countries

2 AOUT t969

UNITED NAT\J:ONS IDEP/ET/XLVI/760

GAN· INSTI'rUTE FOR ECONOMie DEVELOPMENT AND PLANNING

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tl .

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...,M66-1876

]) A K A R'

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AilMINISTRAT IVE ASPECTS OF PLANNING IN DEVELOPING COUNTRIES

by

J. H. GILMER

Conseiller Régional en Administration Publique Commission Economique des Nations Unies pour l 'Afrique

Aru1ée scolaire 1966- 67

UBIT.ED NATIŒS MEETmG OF EXPERTS ON ADMINISTRATIVE ASPECTS OF NATIONAL DEVELOPMENT PLANNING

Paris, 8 - 19 June, 1964

ADMINISTRATIVE ASPECTS OF PLANNING IN DEVELOPmG COUNTRIES

1/

Febru<LXy 1964

ORIGlllAL: FRENCH.

!/Report of Prcliminnry Study conducted for the United Nations by a tcam of consultants undor the direai;orahip of Pro:foasor Fran90is Perrous and his doputy, Michel Dcbcauvais of the Institut d'Etude du Dévoloppomont Economique et Soci~, Paris. This report doos not neoessnrily express the views of the United Nations.

64-38634

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INTRODUCTION

CHAPl'ER I Seotion I

Seotion II

Seotion III

CONTENTS

PARTI

The

central. planning organization . The ohoice of a planning organ _. . . .

The scope of the plan •••••••••••••••••

1. Planning ·restricted to a few sectors

2. Planning covering all national activities

a The sise of the ·central planning or gall. • ••• • .•• • •••••••.••••••••••••••••

1. Light :framework

2. Operational f'unotions in oase of indicative planning· . ·

3. Where planning is of an imperative type

The place of t~e central planning organ in the administrative structure 1. Planning entrusted to an existing

ministry

2. Planning devol ved on a new type of autonomous body

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1

/ .

2

4

9

CHAPTER II

Section I

Section II

Section III

Section

IV

: The external relations of the central planning orgenization

The central planning organization a;nd_ go ... v-er:nment •• , •••••••••••••••••••••

1. Liaison with parliament

2. Liaison wi th poli tical:: ()rg~izations

3.

Participation of the Executive Liaison between the central planning organ and the administration ••••••• _ •••

. . ..

1. Liaison with central administration 2. Lia.ison wi th the regional ...

administration

.',· ·

'• : ,:,_

Liaison between thé central ·planning organ and socio-professional bodies ••

The central planning org~i~ation

and foreign aid •••••• ~···~•···;•,:•:.·~·.•~·· ·

.. ·. -:)·· ^{.. ·}

., . .. j

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14 ..

18

23

25

PART II

. .

The formulation of the plan ••••••• 29.

·.'

CHAPTER I z Statistical information •••••••••••

31

. . . . .

1. The powers of the planning orge.n

wi th regard to statistical. information 2. The standardization of data

CHAPTER II ^{: ~ ..}

'

: The determination of priori ti:es •••

37

CHAPTER III : The preparation of. detaile.d

objectives•••••••••••••••••••••••• 43 Seetion I Determination of seotorial ~bjeotives

45

The participants

-The p~tic~pating, organs

- Procedures ree;ulating particip~~ion

- Arbitration procedures Section II Determination of regional

objectives . . . · • ~ •... ~ ..•••

52

CRA.PTER IV The approval of plans •••••••••••••• ~.

57

1. The appX9ving authority 2. The legal·scope of· approval 3. Publicizing the plan

iii

CHAPTER I Section I

Section I I CHA.PTER II

· Section I

Section II

PART III

The execution of the plan ••• , ••••••

: The conditi.ons of execution : Admini&trati·ve ·pro.b'lems related

to fin an. ce •••••••••••••••••••••••••

Capital budgets Recurrent budgets

Relationship between capital

and 'o':Peratièm expendi tures

Extra-budgetary finanoe

:Administrative measures •••••••••••

: The execution prooess

: Central administration.· •••••••••••

1. EXecution entrùsted to the planning organ

2. Execution entrusted to t.he

.~pecial.iz~d ministries

3.

Execution entrusted to autonomous administrative unite

Execution at the regional ·and local levels .... .... •.:• ... , ...••.••••

1. The adjustment of administrative machinery

2. Public participation

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62

66

73

76

82

Section III

Section IV

CHAPTER III

CONCLUSION

The execution of the plan

by the private seotor ••••••••••••••••

1, Means of action of the administration

2, Foreign private investment

3.

Foreign aid

The human factor in the execution of the plan••••••••••••••••••••••••••

1. Planning for administrative needs 2, Training methods

Planning control, adjustment and revision ...•.•...•..•.. •.,, .••• .e •••••

1. Control of the execution process 2. Evaluation of resulta

3. Revision procedures

...

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93

99

102

107

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TITTRO:OUCTION

-A stud~r of the administrative aspects of national development planning presûppo.s.es a rigorou.s defin~tion of the two terms b1volved.

rn

accordance with a generally acoepted view, we will here talee national develo:pmen-G pla.•ming to mean a coherent body of medium - and

.lQng~ter,rn Q~j~c~i_y_es~ so designed as to ensure the optimum development

: of\'material and hu:-aan :resources and f:!pecifying the means and stages involved in achieving that devel9pment.

> We will tL.erefore not concem ourselves here wi th. specifie in-

vestment proj,eots which are .not linked together in an ove:r;.U. conte:x:~ :, •

. ,· .. _,...,

the settin.g; up .of industri.es, infra_s:tructure work, regional development

~ ..

programmes.. Nor will we deal wi th fore casting studies which are n?t

u~ed aa .a_ pasis. for gove:mmental deoisions.

Then again, the administrative aspects of planning do not in-

cl'4-de plan..1.ing as a 1'ihole nor the whole field of public administration.

• • "·1~ • •

Planning embodies T,oli tice.J. ~_}lpeots which are_ undoubtedly ·the m'o·at important. The plan is only the instrument of a development polïcy;

i t ex;ress'es

-~ lie

^{economie and s}ocial priori ties and the

long-te~

. ' . ' 1 • ~ . . •

national objective in conditions and measures required for achieving that objective~ Wi thout a clear prelim:j.nary definition of the basi.o al tematives and the st:ructural reforma and wi thout sustained. political determination dul'ir!g i ts. implementa:t;io!!-, a plan is noth~g l;>ut.. an

empty frame. ·The key poli t;Lccl aspects- might be a.naly~e!i f~m the polîtical .science angle but this lies o.J.tside .th~ scop& of the present

~ -stud.y-.

.. .

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Planning likewise includes technical aspects on which attention has hitherto been mainly concentrated. Almost all etudies of planning are devoted to techniques of preparation 'and projection and to' modela of growth involving complementary or alternative f~ctors. Such studies of the develop[nent of an economy also lie out.side the specifie subjeot vdth whioh-we are conoer.ned.

It is nonetheless worthwhile examining the specificallyadm:inistrative factors in planning. Orice the political authorities take the basic decision to plan development, certain administrative choices must be mad'e:

(a)

What

·b~dy is to be entrusted with preparing the plan?

i8 i t to' be 'gfven? What relations will i t have wi th the autho:t'itfes, ·the administrative department, the economie groups?

'What powers political and soçial

• ', 1

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^..

(b) What administrative procedures are to be employed in the preparation and approvai. of the plan?

. ··•. . . . . · ...

(c) Who is. to be responsible for exeouting the plan? Who is to super- vise i t11'. implem,entÇJ.tion? .. Who is to evalua te the re sul ts?

All these. organizational problems ·deser:ve to be studied as such Binee ·.the choices mad·e in this field have beth short and long-term effeots cri the smooth running of the planning process ~ to a large extent,they condition its suooess or failure.

In ërder to ari~yze these administrative factors, it is not enough merely to describe those bodies which, in v .. ~rious capaoi ties

. . .

are res:i;>onsible· for the preparation and execution of the plan. A wfde ·

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range of structures exista in the various countries and even an exh~u:stiire / Aij

inventory would provide very few indications of general significance.

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If we are to appraise administration as the instrument of a policy, we must first define its functions: What task is entrusted to the administration in planneù. development? '!-Te can then consider the problems raised by the choice of administrative structures .sui ted to that function. ·

We will therefore endeavour to specify the function of planning in relation to the w1:lole complex of tasks handled by the administration.

I. The function of -olanni~li

~e administrative aspects of planning do not include a study of all the problems of public administration. Although the administra- tive bodies an a whole are conce:rn.ed with the_preparatio:n, or iP!plementa..:..

tion of the plan, their t ask cannot be confined to thia. For purpo.ses of this study the pla.:n:':'l.ing f'unctions will be distingu_ished from the management fun etions ^c The latte~ in eludes the tradi tiona1 tasks of the administration \l:::.i ch consis-!i in applying the economie and social policy defined by the poli ti cal r.:phere to the existing_ si tua

ti

on: managirig the public services ü:. a way tc ensu:r:e the fulfilment of the principal tasks assumeè. by -~he Bt3.t.·.:> and :.--:-eco::1viling opposing or divergent in-· terests of the i:ndi viduals o:t> grol!:ps making up the nation. The· former consista of al·ce:-j:1g the exist:i.ng situation jn order to aohieve ·the objectives of the plan, · I·c is -~hi9 parti cul ar fun ct ion which we shall study here.

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To separate th se two ~unction~ in a eut and dried manner would, of course, be arbj_i:;ra::..-y. The adminict:•ution ehould conoern i tself wi th both but such a dis tinctio:n oan le ad tc a choice having tc be made between the present :mel the future. '!'he fu-'\iure rôle of development is

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largely: ·detertninè.d by inveatment, tha.t is, the share of a.vailable .·

resources which ·mU.st.be set aside in order. to ensure further develop- ment. This interrelation between. present and future mo!=Jt often . talees the ·form of opposing or even contra.dicting interest, on the one hand, of the requirements of present needs (consumption, .immedi1:1.te utilizati,on of all available, manpower ) which have an immediate

' . . ·: . ^' . . . . .

impac.t ~<h on .the other hand, of future needs which are specified in the plan.

This opposition of influences is seen in every field of administr~

tive activity; but i t must be continually overcome by the integration

of· the a.dlhmistration' s economie and social po licy in .the long-term

cëintext· defined b{ the plan. In respect of adminis.trative activity, therefore, 'we · shall distinguish the "planning fu.nction ¹¹ f):'Om the

11managemènt fùnction ", still bearing in mind that ue are dealing with two ëomplementary aspects of administrative <1ctivity.

· Furt:b.ermore, the administration ià made up of specialized bodies,

.:·.:·:-

eac.h one 'wi th a specifie function. The· projects or plans of these different units are not neoessarily compatible with the objectives

. 'i ·~ '

of the plà.ri ·and their harmoniza.tion raises administrative problems The tension which is often seen to exist

_:. .. : .-;.·, .. . .

between the pÏo.nning body, the' Ministry of Finance 2nd the technical ministries i~ ^<typi.c.:ü of this oonflict between the two functions. ·

·;l . ... The administration is not organized only according t~ the pri:rlcipie of :specialized functions; i t also contains central bodies which initia;t~· and decide matters· as well as local bodies· (provincial, m~:i.cipal, eto ~ ) r~sponsÙ:lle for applying general directi vee. ^{As ·} regards planning, the proble~ of devolution of authority arises at every level, i.e. the extent of participation in the elaboration of the plan and autonomy in its implementation.

..

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The adri!inietrative factors in planning, therèfore, cannet be

studied ·unless they· are si tua,ted in this· complex system of. specialized bodies, whose drivè, powers, • and :preoccu.pa;U,ans are different and. sometimes divergent.

The elaboration and i~plementation of a plan introduces a new dimension into administrative activity, Through the interaction of the. planning ftinction and the management fUnction, the plan may al ter the behavior of all the adininistrative linits or al tema ti vely come up agains·t their resistance to any change,

But the_{. ..:} . administration _{. . .} itself is not ,... an isolated whole, . It is connected with the political authorities and the economie and social groups within the country, How are these relations organized

.. ^' ..

in connection wi th i ts planning function?

··The traditional concept of a separation of authori ty provides an initial answer to this question, At the highest level₁ the

political authorities take decisions of a general ^kin~ which involve governmental responsibili ty and the future ·of the country, .·

:tt

.is · the administration's job to bring up the technical implications of the objectives before the political authorities, study their

compati bi li ty ·and suggest what steps should be tcl;:en but the ul timate decision resta wi th the poli tical authorities •.. The admi,nistration is responsible for the ~pplioation and supervision of the plan.

Representing, as it does, the concept of the general interest, the

!·

administr<;l.tion uees the m._. ean.s a.lloted _.. to. _. i t in such _{. .} a way that the . collective. project, which is the plan, guides the decisions of

individuals and independant economie and social groups and where necessary to a.rbitrate conflicts between specifie interests.

L

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In actual fact, these legal :t>oundaries are continually oalled into question. The administr<::.tion is alse

an

authori ty.. --~ :certain

oases1 it may oppose the :i,mp;lem~t?,;tion of a plan whioh the political authorities wish to carry out. In other cases, it may ensure that the plan enjoys a certain continuity despite political changes.

Within limita, it may orient the activity of ind~pendent groups along the lines of the plan. On th.e other hand, . i t may find . i tself powerless to alter decisions in the private sector whioh run counter tc the plan in spite of its legal possibilities of offering stimulus or imposing restraints. Finally, it may be dominated by private interests. This network of interrelations can only be understood through a dy.namio analysis.

Aooordingly, we l'T~ll study planning as a process of deoision- making in which the administration¹s rôle consiste of preparing and implementing the pl<::n in this poli tical, economie and soc.in.l. environ- ment.

II. The P.rooess of Decision-Making 1. Preparation

:The preparation of the decisions which ma.ke up the plan may be considered as a network of organized communication.

Whèther it.is a case of assembling the -documents necessCU'y for preparing the plan, submitting to the government the principles of. the po-li tioal al tema ti ves to be settled, consulting ad.ministrati ve

services, professional groups or representative associations, collecting

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the advice of administrative personnel or supervising their activity - whatever ·the case; ii; ·is the informatior. exchn.nge<i through the administrative ci:-ccuitc which must be de;f:i.ned; thc..t is, informatio11 in wri ting (letters, reports~ statistior; ₇ etc.) or oral information

(meetings, committees, etc.).

In i ts dynamic aspect, this process implies a certain recipro-.

city in the exchange of information w:O.ich al ters. the behaviour of the personnel. The information required for dra-vring up the plan is.not necessarily the same as that colleoted for other purposes;

national acoounts and basic statistios must be ado..pted to planning requirements; professional groups will also be induced to assemble new information in order to satisfy the needs of the planning body;

the elaboration of the detailed points ·:;i thin the general framew:o.rk deteriniri.ed ·by the planning.boçly will lead individu.::'.ls consulted to al ter theix' projècts to ensure that they coin?ide ni th the direction taken. O:ri the other. hand, the general direction may b~ al tered by this exchange of information v-rhich may reveal incompati~ili tiea· or impcissibili ti es.. In .all countries, the experience of plWning ·shows· that information does not fl,··.; ür a single direction and that the flow bet1-reen the centre and the periphe:ry is a dyncmic proces_s, a dialogUe which representa a recipr·ooal enrichment,

Similarly, the exchanges established between the administration and the polit:i.cal authori ti es when the major al terne.. ti ves 2.-re. set out and when the :pLm cornes up for discus.sion and final approval enable the responsj_ble authori tie.s to apprecia te the long-term

implications of the choices and m~e their decisions on a more rationa.l basis whl:-le. enahling the, .adminj_ctration to take the ~on..:teobniêal.

factors of pl annine- i.n to 01.c coun t.

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· _Ex~h&lge:

ot: .

informat~on: and parti.cipation are two complementary

aspects of t~e ~a.me pro cess. The ~roader the exchange of information, ..

the greater the possibility of ensuring the pa_... rticipation of the ·

: . . . ... '. .

variou,s agents-at all. stages of planning.

The circulation of information can be organized on an: impersonal basie.

.BIJ.t

the participation of the various groups in preparing the plan involves the question of human relations. The human factors constitute an element. which is as vital to administrativeactivity as the organizationo..l factors. The problems of co-ordination,

persuasion and training, highlight the importnnce of the human element. in Planning •.

2. The Decision

Approval of the plan by the political authorities constitutes a legal act of a new kind, the nature and ecope of which must be examined. Oil. the one Lhand, approval of the plan is not an isolated decision-but the culmination of a multitude of rulings at all levels and sttl.ges .of its preparation. Oh the ether hand, the plan is only a fra.mewo:rk for the orientation of' subsequent decisions; i t cannot possess the sa.me ·powe::c of compulsion in the pri ve.te sector as i t does in the case of the administr2,tion and the public seotor and it is this which distinguishes it from ordinary legislation or regulation.

Furthennore, the continui ty of the plan calls _into question the prerogatives of the government or legislature to the extent that it· consti tutes a commi tment over a long pericid.

IUt. the analysis of decision-making cannot be limited te thiS'·~

juridical aspect. Once a decision has been taken, it still has to be implemented. The transition from decision to action exista in every

•.

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~ministra.tive p;rocess put it is; still more important where plannl.ng 'is ooncerned. sin.ce the dec~~i9ns · i.zlV91V_ed ~uàt be appli'èd over a long period.. Implemer+t~1;ion, ther~fore, .must not only be immediate but also

continuou~. . Ë:~nce .

the importance of supervising the a.ppiicâ- tion and the neoessi ty for 'flexib:i)-i

t.Y

whi_oh might tàke the form of

adjua:î~èn~s ~r pe~iodio retisio~.

Finally, the implementation of the decisions oonneoted wi th the .. p.lan· oannot. be .:malyzed merely from the official poiht of view~

\: . . .

The implemantlilotion of .. the plan depends not only on thé decision and oontrpl of the administration but also on the changes in thé. behavior pt people out:üde' the administrative a.p:p'aratus. For:thi~

.:r~às·on,. _{.. ::. .·} the, _... c~le _of' the a.dniiriistratioh beoomes more of uiobl.ll.za.tion than .. supervision.

·"· -· ,. ~ . . ~ .

., .,

This .. z:elatively new task ma.y .be part'ly entrusted to speoialized . ^{. -}.. ^, ... '

administ-rative' units (agriculturai. ex_tE:msion services, communit1 development_. :·.an.<r 'socia.l serVices). _. It may also rely on existing _. .. ,

., ., . . ~

institutions orthose to be' set ùp in the future (politicaJ. parties, looaJ. col~~ctives, .prefessionaJ.. groups or tra.c'ie unions, village

i .

'·

leaders, .. youth movemen tl3' e:tÀ. ) but i t likèwise iniplies ;i

~ at

ti

tû.d~

gea.req

t~ devel,C~JlÇl~n:t ·:Qn

the part of aJ.l the

· administr~tivè sei-v:i·o~s,

^.

i.a. J>ase(l. on . animatipn, impe tus and ·co-operation ·rather

' than ·

^{hl.e.rarÔq ·.}

and a.utho-ri ty •. · This is .. where :the: hum an facto'i·s come

ïn · a.n. d th~y·

^{:·. -}

.. ·.. . •. .

are of de~i~ve impo-;rt·:"',.nce ... to the· suo:Oi&ss' of planning.

3. The: Si?eci:fü,

-~ôle d o·~

^the-administration ^{,. ~}

. .

^....

The political ~eoision, therefore, ià. only'a stage in the process whiç:tl .__{·_!.\','} oçcurs _{• ; . . .} .. midwEJ.y between preparation_·. · and implementation~_;

· rn

_{. -} ^thesè _{•••• 1 .... , • • -·}

two st~~-~- -~t..:::~rqp::q::q.i;ion and im:plemen

tati on

.:thè a.diriirtiétr~·hon ··h~ a · · · ·, ··

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specifie rôle to play as intermediary between the politica.l a.uthoritiês and the economie and social groups. It fulfils this rôle to the

extent that. i t is· capable of organi-~i:i:lg this· sOcial dialogue ·and eneuring a balance between the objectives to be achieved and the

means available for their achievemont, between what would be desirable and what is possible, between the present· and the future~

This does not merely involve teèhnical factors and financial

resour~e~.-which, beoause they are limi ted, imply an order of priori·t;y between the competing targets, but alan the human resouroes in that the limited number of .awninistrators or skilled workers likewise imposes serious restrictions which must be borne in mind.

This

huma.n factor implies the preparation of training programmes in conneotion with the integration of economie and social planning, and, above all,

the adaptation of the plan¹s objectives to the administration¹s oapaoi ty to prepare and implement programmes.. The preparation of the plan should thus. be worked out in relation ,:to the possibili ties of application, even if .the two phases are distinct in time.

There is no general principle for determining this point of balanoe.nor are there any forma of organization which cana priori· be reco~end'3d • . The administrative problems are invr.:.riably specifie and._depend on the _{... -} ~~ticular circumstances prevailing in each coùntry

. .

at any given moment. · fut while administration may be "the art of the· possible", i te rôle çonsists of noting the contradictory aspects · of each problem so as to allow for these in preparing and implement- ing deci~ions.

...

At eaoh of these planning stages, therefore, an effort must·

be made to de~in.G:: :the specifie functions to be. fulfilled, to' revèâJ." the a.œrtr&di.ctory ~P.~Ot~ .and to .indioat·e the. various fOrtilS of org~iza.-

. _.

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tion which n.ave been tried out. A more complete analysis than we

·. ,1 . .

have beer( al!lle to make should sho1., to what extent the solutions adopted have met the reQuirements of the tasks to be carried out.

Hanng 'thus defined the rôle of the administrative factors,

it beco~es rlecassary to indicate the limita of the rôle more especially in thé .. developing countries.

III. :Administrative problems specifically connected with planning in develcping countries.

·1

. It is obvious that the rôle of the administre.tion in planning .. . 1 . .

is condi tione.d by. the. political, economio and socüü structurés.

Imperative· planning in countries wi th a centralized economy and·

indicative planning based on foreoast, instigation and persuasion, represent the two opposite poles between which lie various

combinations.

These various combinations represent diffèrent tasks incumbent on the

adm~istration.

The more limited its means of taking àction

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the greater the danger that the plan will be a mere frame of reference

1

without any practioal significanoe for either the privcte aeotor or the admin:i.stration as a whole. Ultimately, there is a duality between the planning function, which is directed towards expansion, and. the management polioy which ia motivated by a conoer.n with stable currency, budgetary considerations and balance of payments.

"Stabilization plans" are superimposed on i ¹¹development plans¹¹ wi thout either co-ordination or arbitration.

Where the .. state plans all economie ac ti vi ti es this con tradiotion is overcome but the initiative of the economie units may be hindered by the bureauoracy which centralizes the decisions. 1 In the two

1

extremè cases there are organizational problems to be' resol-ved. a.l though the question ·st~_ll remain.s as to how t> organize a more or lees self- sustained growth. ·

. What is lacldng in the underdeveloped countries are ihese

in tarn al impe tus es,· It is no.t enough to classify coun.tries acoord.ing to the range of the public sector in order t.o measure the administr2-tion 's rôle in pla.nningo Any analogy or trans position -vrould be mislee .. ding

if we ·wérec·to res tri ct ours el ves -'·to a _description of .. ~he admin.j aire,ti ve

. ... - ...

structures and procedures without allowing for the partioular

oharacterist~·.r.:a of their economie and social structures which limi t the administration 's effective me ans of taking action. Thèse concepts are now fu1ly understood and we will do no more than rei terate

the important ones:

(a) The administration is not yet adapted to the m~agement functions required in a modern state: the separation between the political, the administrative, and the private interest is not sufficiently defined

and

the concept of the general interest insufficiently recognized. The competence of personnel, stability, the impersonai nature of official activities~ the delimitation of responsibilities are·· not ensured. to a ~atisfacto:'l.:'y cfegree,

All thes9 ne,5ative ~~· ... ' . ···:,·'~.'~:_:-; a:::c ilwdequate to convey· the problems _existing in the admird.st:cation in these countries. A more thorough analysis would have to try and. understand these phenomen.a by relating t~1.e:a to their historioa,~ anCl social context. fut the

faot remains that the administration is in no position to ensure

that th-e services of the state func-tior:· adequately. It is still lees sui ted

·:' '

- lJ- · ....

to the new .tasks of planning. These parti cul ar di ffi cul ti es· will· be speoified in the course of the present-study.

(b) The· eoonomy is inarticulate: the market mechanism works badly, growth fails to spread, global and indirect administrative measures are of limited effectivenesse The intèrests·of the'val:'ious economie and social groups are ill-organized and poorly represented, thereby malting an.'y sooial dialogue difficult to establish. The tradi tional seotor (rural and urban) representa a speoifio sphere which is 'n.ot adequately linked to the modern seotor while the administration's ordinary

··

^.. me~s ^{. ·' .·}

.

of action have no effeot on it. There is a tendenoy for the unevenne~e; of regional development to increase and planning . com~~ Ul>. a.gainst considerable: di ffi cul ties in attomptin~:· ~· · S\lpple-.

. ·' .·. . .1 . . J • •

ment action on the various seot.ors through regional aoti,Qn•

(o) The laying down of priorities involves grave choioes bcoauSe' of ,the tremendous gap be1;ween need.s and reaouroes. In the ._{. :.·'} induatria.l _{. .} countries, planning relates .to the distribution of new resouroes

.·, . . . . . -·

deriving from eoonomio growth and ... the choices made involve f:ewer.

sacrifices. Elsewhere it is neoessary to decide (explicitly or i.J:pli.oi.t;t.J)' which fundamental huma.n needs cannot be satis.fied fo;t-•

a long time. The political and social pressures against the plan are acoordingly all the greater.

(d) Dependance on the outside: world tends todistort the est~blishment

of objeotive.s .. and, the means. for achie;v:i?g them: fluctuations

±.n

export priees, the freedom of foreign firme and inves~ors to make independant decisions, and ·~he divergent strategies eonneoted with foreign aid.

(e) fhe aize of underpopulated states is also a hindranoe t~ planning

- 14-

l7i thin a national framework; i t resul ts in multinational associations for which the political conditions do not yet exist.

Al though an anrl.lysis of these problems do es not come wi t.hin the ecope of this study it is necessary to remind the reader of their importance. The a~inistrative f~otors in ple~ing ~annot

be studied unless they are put in this over-all context .of oomplex relations. There is no single model of administrative organization which oan be used as a critcrion for olassifying the different national experimenta.

~here are also succe~sive stages of developmont and, at each of these stages, changes must be made in the orgonizational forme.

Just .as plan~g is a process of continual creation so the administration must continually adapt itself to auch development in order·to encourage

progress. ."'

The des.ign chosen fo.r the study follows the normal ohronologicaJ..

phases in .the pl~ing process even though these do not always follow in the same order in all countries.

The fol1owing points will be examined in turn:

1. Choice of the planning body

2. Administrative procedures in drawing up the plan

3. Implementation and superti,sion of the plan; adjustments ;·

and revisions.

...

- 1 ...

PARTI

TBE CENTRAL PLANNH,TG ORGAN

~lanning introduces into the administration of a country a new · ta.otor tha.t affeots its entire functioning, and therefore itc

execution oannot be limited to the creation of a supplementary unit.

The functions of planning and management must be linked, but not oontused. To arrive at this, a balance between opposing require- ments must be sought.

In fact, this new function, whioh needs to be oarried out on a permanent basis, leads t~ the establishment of a new type of oentra.i orgm. . · Eo,wc:'tO.X, ûV.cry:;.C.cv..a.~'tiva.:. e.g1;.ahlis.h-

ment leads to resistance on thé part of the e.xiating machinery.

Yet, planning cannat be properly oar:ded out wi thou-; the close oc- operation· of the.already existing administrative departments.

Consequently, the first problem to be solved is to decide whether:

(a) a speoial organ _should be eato.blished, in which oa.se ·

· p~rticuln.r attentiGn must be pr.l.id. to i ts rolationship- with 1h& oth~r adninistrative ·depal'tmènts;

(b)

to entrust the responsibilitiea of planning to an existing ministry, e.g. finance or economy. However, this _entails the risk that planning.might loee ite specifie oharaoter, or elsa that the performance of the traditional tasks of the ministry might be endangéred;

(o) to adapt the structure of an existing organ to enable it to undértake the functions of planning.

- 2 -

The selection of the beat formula cannot be made ~priori. It depends on the political, economie, social and tocbnical conditions of the country conccrned. It is princip.::üly subordinate to two basic factors, i.e. the nature and scope of the plan and the availability of tra.ined staff •. ,

· ·cHAPTER ·I THE CHOICE OF A PLAm{ING ORGAN

Section .!~ The ecope of the plan. ^(·

The planning operations entrusted to the administration are merely. reflection of a furidarnental poli tica..i.. choice. The importance a govemment aosigns to plannirig depends principtüly on poli tical considerations. A 'governinent cannet plan the development of i ts country without 0ltering its economie structure ~~d the relationships between the· various socie .. l groups. Planning is not a "neutral technique".

The contciit and scope of a plan are at the outset determined by a choice situated somewhcre betweèn two opposing concepts:

1) Planning restr~cted to a few sectors

.

^'

Planning alroady cxists vrhen co-ordination ttJces place between certain programmes and projects in a limi ted numbor of key sectors, . . . ^. . and between these sectors themselves. It then àffoots 'oniy a part of investments, mainl~ or entircly in the public soctor, while the priva te sector reto..ins i ts autonomy to a ·large cxtont, bea:ring in mind that indirect Ste..te interference may occur in certain cases.

The main features of this idea of planning ha.ve been adopted in Uganda, Morocco and most Latin American countries.

It is also the concept thnt prevaile in France where, to use

the torm of Mr. P. Massé, the plan is ¹¹a reducer of uncertain factors".

. .

.. -

- 3-

This concept of flexible planning do es not basically al ter. the structure of the liberal economy of the countries concerned. A

~-, ... . ..

goner~ orient~tion is indicated and backed by a more or lese co-ordina.ted policy of public investment. Howover, there is no_

direct action on the private sector or even on a.ll forma of publio investment. · -··

2) The plé1ruling which covers all national activities is referred to as "imperative", while that described above is known as "indicative"

planning. The stondo.rd exc.mple comas from the USSR, whore (kaplan (the Sta,te Planning Commission) is responsible for co-ord.inating the acti vi ty of' the V:J.rious· branches of produc't:lon and

of

the economy in general. It is also responsible for co-oz-dinp.ting the expansion of production and of consumption, the fin:..ncing of production, the

supply of raw materio..ls and the socia.list distribution of the productive forces.

Obviously,_ this classification is only very sketchy. The scope of a plan varies from one country to another and ofton, from one stage to . the next in the same country. It has been noticed that the scope

of plans oft~ expnn4s with time, to the extent to which publio

financ_ial and skillod manpower resources _increaso. In many developing countries, a beginning was made by undertaking limi ted programmes, after wbich they were co-ordinated into an emergcncy programme or e.. short-term plan, this prcpe.rv.tory phase precedi.ng .a mo:rê·. systematic and more general medium-tcrm plan. For a thorough description, eyery

:)

country should be considered separately and the historie evolution in each of thèm described. However, whatever concept is ~dopted, ,P.lanning remi!.ins a specialized function which is usually entrusted to

a new type of central org2n.

While the field of application of a plan, which reflects the degree and nature of State intervention in the economy, depends essentially on a. political decision, which varies with the count:cy considered, on the

- 4

administrative level, a general trend to entrust the :preparation of :planning .to a single central organ can be observed. From the moment a govemment takea the :political.decision to plan devE?lo:pment, i.e. to act on the economie structuresby defining economie objectives and the methqds of achieving them, this over-all conception in vol vos a central, s:pecializcd and permanent administrative structure.

An exa.minati.cm of this central :planning organ may be related t'o the ·soopé of its ,duties, which depend directly on ·the poli tica.l · decision referred to above. Its fields of competence may be assessed on the basie of the economie and soci~l activitics involved, which are usually :provided for · in the legislation by which i t is creatcd.

rt'. oan also be studied more thoroughly on the basie of the real nature of the :planning :powers it actually exorcises over the various seotors of economie ectivity~ imperetive planning covering' all the economie sectors; indirect planning based on over-all or selective methode of action; purely indic~tive :planning limited to registering the forecasts of autonomous economie ~enta •.

The choice of a responsiblo planning o'rgan clso raises other administrative problems conneoted with its size, its location and the organizatiori of its contacts with the gover.nment, the administra- tion, the private sectcir and the outside world.

Section II - The Size of the Central Planning Orgnn

The size. of the cent:rn.l organ depends on the ecope allotte.d to :planning, but also on the availability of trained staff. The wider the ecope ~f the plan, the .great.e:r the need. for competent

official& with a wide range of qualification~ (economiste, administrators, specialiaed technicians) becomes.

·.

- 5 :;_

The aize of this body also depends on the duties:allooa.ted to i t. 'In certain :fields i t may be responsible for the execution of the plan, a faot whioh influences the 'Eize of i ts official staff.

When there is only a limited number of trc.ined staff available, i ta distribution bet'tfeen the planning organ and other administrative divisions involves a ohoioe, in which the extent of the duties entrusted to the planning organ e..nd the administrative tasks carried out by

the vario.us ministries must be. tClken into account. The size of the planning organ may be. assessed in the light of the se two criteria •.

A reduoed staff may. correspond to a restrictod part of planning, or to the desire of facilit~ting liaison with the other branches of the administration. A lO.rger staff, in wLich the planning orge.n would contain the administrators, economists and tochnicia.ns, might be able to fill the extensive plMning t<1sks, or be based on the desire to provide tho va,rious administrative divisions (whether national or regional.) wi th teohnical assista.n4!1e for 'the preparation

of the specifie progra.mmes for which they are responsible~ Only · a few exe.mples to illustrate these various·aspoots will be mentioned here.

1) A small organ oorresponding to the concept of a highly qualified gener.J-1 t:Jta~f, responsible for maintaining co-orclin;:!Jion wi th the

deoision-rna.king bodies of the various branches intcrested·in ·eoonornio and social devcloprncnt. This is gonerally an organ for rcsoa,r~h,

. .

co-ordination and study.

This system is u.sed in Morr~cc.o, Y~ere the Di vision for Economie

. ' ^.

a..."ld Planning Co-ordination has a staff of about 60, less th:m 20 of whome are hi[.,hly-ql.lali~ied experts. This rel.:--tivuly rudimonj;ary structure also oorresppnds to tbE3 rather limited rôle .played by tp.i~

' 1 • • • •

o~gon in t.l;l.e organization of the Moroo.oan. economy.

- 6- ..

Ill :the Sudaii, the Under-Secretariat for Eoonomi.c Af'fairl;3 and· Planning: has .a:· staff of only 32· offi.cials an,d exporta, 'This small group is. mainly .concerned with .the co.;..()rdination of· spe.cific pro~ects

prepared by the various administrative divisions.

'

In France, . the ·permanent staff o.f the Ple.xming Com.t;nission .is limite d' .to about 50 é?..dministratcirs and, economiste.. This is, not Q.ue to a shortage of personnel, but to the concern th2.t over-lapping and ri valry as to competono.e wi th the mini stries be avoided, so. as to.

facili tate. their cO'···vlJuraticn r?i th the· Comm.ission •

. rn:

India, the sto..ff of ·the Planning Commission is small in comparison to the vast and dense population of tho country. It employs·about a thousoild officials, about 370 of uhom are e:Jg>erts and të.cbnioians .di vidBd up among the .horizontal or funotion~ uni ts ·

(general di visions) and the .vertical o.r seotora.l uni ts (subjeot

divisions). Thè Commission oo-ordinates individuc.l projects, prep2.rGS the over-~all plan for the publio. sector .as a wl;lqlc, and make~. forecasts for the private sect-or. In sorne. cC.ses,, i t prov:i,dcs .tecbnical . .assistc.:noe for the preparatioÏ1 .. 'of o-pera.tional projeota-, al though the re.sponsibili ty for preparing projects devolvos on the ministries of the Central

Çover.nment or the State.

..

^.. _:.-:·.·

2) The ëentrr.l planning· organ may have opcr~'..tionel functions . . in the case of indicative planning;

..

An example of this is the Corporation for Chilean Production Devel~pment (Corporeci6n de Fomente de la Produc~i6n de Chile or

CORFO)·~

^{. This is 8.11}

a~tonomous .pu~ Îio ·b~dy

^{managod by a boa.rè of}

directors. whioh includes representatives of the executive ·and the· legisl~ture, privàte industrial arid commercie.i a~sociations and

publio

~rgan.s 9

^{CORFO has}

^{a ;}

^'v.ery elabora te .·s-tructure.·· The :corporation he.s a planning section·, fi

.;,.e

spe~iaiized sections, thrèe ··subo..seotions'

.. .

- 7 -

a legal department~ nine other departments and an agency in New York. It employe a total of 300 techniciens and 150 office staff at hea.dqucrters and a staff of 40 in Now York. Consequently, the staff employed ia rel a ti vely l are:;·.), al though the Chi lean

plan is an indico.tive one, designed to promote the development of the country within the f~amework of private anterprise. In fact, CORFO performs oeveral functions. It unde~akes surveys and research, prepares the plan, establishcs and manages certain eri terprises in co-ope:..-a-tion wi th the priva te soctor (shares in capital, loans, etc.). The size of the st~ff of this organ ca.n be explained by its operational ac-Givity.

3) Wher~ planning ~~ of an imperative ~' the central organ is generally very ~cll ste.ffed for in en oconomy where

all production sectors are government controlled, the adm_inistrative organization of the plan bas many ramifications and req_uires

a large staff"

The Planning Commission of the ^Uz~ekistan_ Soviet Socialist Republic (Gosplan) omploys a staff of 380. It has a chairma.n, an advisory council, four vice-·chairmen, and the rest of the staff are distributed among two large categorios (six sections responsible for the prepar~tion of the plan and six specialized sections for industry, agriculture, transport, commerce, municipal economy, social and cultural affairs). Tr:.:~·ee specialized ag·ericies working under the direct authority of the Chairman of Gosplan alone employ a staff of 318o

This highly di versif'iecl structure obviously complies wi th the needs ·of a fully-plrumed economy. A similar structure existe for the Soviet Union as a whole. Gosplan here is divided into two categories, i.e. the planning organs responsible for co- ordination and those in ch2rge of specifie projects.

- 8 -

The

1957

reform, under which an important proportion of the duties until then performed by the Gosplan for the USSR and i ta constituent Republier, ^1-ms allocated to the ;;io"':'narkhozes, led to

a

reshuffling of staff and the numbers employed by the central planning argens were consiüerably reduced.

In Yugoslaviê:_, the central planning organizat:i.cn has undergone extensive ch~~ges since

1952-1953,

following the political, economie o.nd administrative decentr1:.lization. The Federal Planning Commission, 1-rhich was responsible for preparing the plan and had a staff of

700,

was replaced in

1953

by a Foder~l

Planning Insti tute i-Thich r.as only technical and advisory funètions.

The Institute now omploys a staff of about

180,

inoluding 40 economists,

20

senior expert technicians (law, agriculture,

ohemistry, geology, etc. ) and 60 senior o!'fici~"'.ls. This rearr::.nge-

~erit became necessary as a result of the decision to gr~t more. extensive powers to the planning argens of the individual Republics, districts and publio enterprises~

tn

Maii and Guin~ rrhere the plan covers r:.ll the economie sect·ors, the cent1·al planning organizat.ion is very poorly staffed for laok of qualified personnel.

These examples show that the size of a central planning organ depends on political considerations, rel~ted to the extent of the mission entrusted to it, and administrative considerations, based on the rational distribution of the avail~ble qualified staff between the planning organ and the managenont organe, i.e. the ether administrative divisions.

Otherwise, the central planning orga.nization may well be a head without legs dcvoted only to conceptual t~sks whioh might remain purely academie 1Ni thout being ever translated into facts.

1

1

•

.

1

- 9-

Section III - The Place of the Central Planning Orgen in the Administrative Structure as a Whole

When a country establisb.es a special organ for prep4:r.~g

the plan, it must decide on its location within the administ~ation

&8 a whole. The view most generally held is that the authority of

th,is organ should be guaranteed through i ts being attaohed as closely

~ possible to the executive. Moreover, as planning is a specifie function, it is often held that this body be given a wide degree of autonomy vis-à-vis the existing administra.ti ve ma.chinery. Such administrative a.utonomy is sometimes suppl~mentcd by fi!Ï.anol.al

autonomy _... .through the allocation

~f

resources for i ts

o~"l'l

^use

.;-(Ir~,

~.· '. . .

Iraq, Chile).

Nevertheless, experience has shown that authority and autonomy in planning are not the only factors to be taken into consideration•

The planning organ should also be integrated into the administrative machinery, so that it c,an exert an influence on it and benefit from i ta co-operation. The problems related to the ste. tus of"the ple.nning organ should be a.sscssed in the light of these opposing requiremcnts.

The following exë~ples stress the administrative aspects of the choioe involved, whioh fa.ll bétweEm two. extreme conceptions, i.e. att.a.chmcnt to an existing ministry and an autonomous org~ directly attached to the chief executive.

1) Where the function of planning is entrusted to an existing ministry

In t,.le great m<:>.jority of cases, the ministry of finance has

boen appointed for this purpose. It might happen that the traditional opposition between finance and pla.iming :rould disappea.r throü.gh this

· arrangement. In reali ty, short-term problems (because of tlieir

urgenoy) are usually given preference over long-term cnes, a faot

which invlovcs the risk of Sncrificing the very objectives of plé'nning.

- 10-

More_<;>v~r, ti:-e pla.nn_in,g s,ervicé is not alwc.ys properly int:egrt!.tod within the ministry_~_ . ~!.! tha~~~g-~-~;, the tr~dii;ion~ administration resista either actively or passively any new attempts that may over-th.rOw lon~tcnding concepts related to finroicial, btidgétary and econOmie policy.

In Morocco, the central planning organ has neither author:i,ty nor influence over the admini~trative machine é'.S a whole. Est.abli.shed 1a

1957

by decree of the Minister of Finance an~ National Economy, the. Div~sion for Economie and Planning Co-ordination is un~er the jurisdication o~. thn.t Ministry. Al though the Minister of ~i.pp.no~

was at the eame time Vice-President of the Govo1~ment between

1956

and

1960,

the Planning Division never g.ained çny real authority as a rosult, and wc.s often on the losing aide in matters subjected to arbi tration~ ·

In

the ri valry existing betweon the Planning Di vision

· and the Budget·· Bureau wi thin tho Ministry, tho l atter frequently

·carried the day.

In Tanganyika, a separate division, mainly responsible for

..

development planning, has been ostablished in the Treasury, whilo in Kenya, the devolopment section also forma part of the Treasury Department • . In the Central Afrioan Republic, tho Ministry of Finance contains a planning division. However, a reform is being adoptod as a result of whivh this division will beoome ~ ~ere management

~· ...

body, and a. ¹¹group for specialized studies¹¹ will be established to take oa.re of the central o.perati.o.~. of planning •..

In the Ivory Coast, the central organization of .pl~ing is divided up among two separate br3lloh€B of the iY'û.nistry of Finance and Pl~ing. Those are (a) the Goneral .Pl~Lning Administration, which consiste of c.. groups of experts occupied_uith the_tasks of study and conception, and (b) the admini.:;t~:-.:t;ion of Gen~ro.J. Surveys, rosponsible for .organizing the work of the Devolopment Commissions

·and the Inter-Min;i.storial Developmont end Plcnning Committee.

~

.

In the Sud2.n, the ûnd.or-Sec:re :;aric.:b of Economy and Pln.nning atte.ched to the Ministry o:t' Fj.na.nce ha.s also di vided up the functions of plc..nning ·. . . ^{. ... • ' .. ' r • ~}

In the case of Latin America, a Central Study end Programming Office was estr:.blishod L! For~ in 1961 for the purpose. of preparing a development plana 'rhis offj_ce was G.ttached to the I'tinistry of Finance and Trade. In U:rt~f,1B:t.' a Co:-11!liS::?ion for Investment and Economie Developmont >ms ost~1.blished in 1959 by the Ministry of Financee These two countries have ,iust begun pla.nned d.evelopment, and these bodies ~re a fiist st ep rather than c. final structure.

In SenegaJ.. ç.nd Mal:!:_, 1·rhore the plnn puts omphasis on. the. a.gricul tural development, the ccnt:r:J.l planning org::mization ~s

attached to the minüJt:ries concorned ui th. rural . dcvelopment.

2) Wher~ ... 1üc..nning funct::.?_~':!~.-~evol ve on a new type of autonomous body ITlhis conception of a eE;n-t;.?:al planning orgo...."1, which is opposite

to that just o:X:aminod₉ also givo3 rise to administrative problcms.

Tension may c.:~:i.ce bet-:men tho central planning o~g:m and .tho existing minis trios. If the plc.nning org2.n is not ondowed wi th

• • .; . r, ~ •

sufficient authorit3•, ~d; is èihen :ï.n a situation of de fn.cto subordine.tion, even i f i·i; doon not fall under the 8.Uthori ty of a particular ministryQ

Such au.thori ty mn.~r be confe:;.~:red. upon i t through i.ts l::eing allocated a high ronk in tho ad..rninistrative hior0rchy. But this is not enough in i tself • .An 2.utonomous body co..n orily give tho necessary impulse to the dovelo:pment plo..nning of c. country if tho

. .

plan effecti v0ly modi±'ios the a.cti vi ty of the o.dministrc.tion as ^2..

whole ·for thc.t purpos6. · The pcrson<üi ty of the.. senior offici<:'.l or ministor rosponsiblo for planning is just P..s important f'or the rccl

authori ty of the ple.nnin~ o:rg:m as the 'lr:::-itt8n logislc.tion .• _: On-the- spot studios havo ^{shv~m tiw} e).:tcnt to uhich ro0lity cifton diffors · · from thoorcticn.J r'1~''"'C.Ii-pt~ior:'" "'Po.cod en l oe;cl toxts.