The sad state of public systems is the result of several, interrelated factors. Scarcity of resources, the most widely cited explanation, is an exaggerated alibi. Of course, the resources mobilised by the State are inadequate to meet costs of government and development expenditures (including maintenance and improvement of social services and infrastructure). But this is in good part a reflection of the failure to collect tax and non-tax revenues due under existing laws. It also indicates inefficient expenditure on both non-developmental and developmental activities.

The malaise is greatly aggravated by the propensity of governments, irrespective of party affiliation, to use subsidised public services. In fact, the public sector irrigation and electricity undertakings were able to cover at least operating costs till the early 1970s. Thereafter, shortsighted and competitive populism took root. Governments everywhere have kept user charges more or less unchanged, or changed them too little and too infrequently, even as costs were rising. The assessment and recovery machineries have become increasingly lax. Both encouraged unauthorised and imprudent use of canal water, over-exploitation of groundwater and electricity theft. Burgeoning losses of these public systems made it impossible to maintain even existing facilities in good repair, not to mention expanding capacity and improving service quality.

The situation is not beyond repair. Elimination, or at least significant reduction, in subsidies can release substantial amount of resources for providing wider and better basic services like free elementary and secondary education, and basic healthcare and safe drinking water to all. There is hardly any justification to subsidise higher education, tertiary medical care in public hospitals and public water supply to the better-off.

The quality of services can be vastly improved by placing schools and public health clinics under user communities' supervision. Experience shows that this brings significant improvement in their efficiency and ensures greater accountability. State governments should focus much more on regulatory and supervision functions (framing curricula, training, inspections, and conducting exams).

These improvements cannot take place so long as all functions