PUBLIC POLICY FORMULATION PROCESS

PHASE – 1 Initiation

STEP – 1: Agenda setting/ issue (problem) identification

STEP – 2 : Policy Instruments

STEP – 3: Policy Analysis

STEP – 4 : Stakeholder Engagement, consultation and co-ordination

Phase – 2 : Generation

STEP – 5 : Policy Formulation, decision making and policy drafting

Phase – 3 : Implementation

STEP – 6 : Policy Implementation

Phase – 4 Evaluation

STEP – 7: Policy Monitoring and Evaluation

Step 1: Agenda Setting / Problem Identification

1. The process of identifying policy issues/ problems require the attention of legislator.
2. Process where the members of society identify their needs, desires and demands and
wherein the legislator decides to place these issues on the agenda for deliberation.
3. Setting of the policy agenda allows a legislator to become sensitized to some of the
critical policy requirements that affects the society.
4. Issue identification can be conducted by forecasting the future with the use of
extrapolation techniques such as the Delphi technique, brainstorming and scenario
sketching.
5. The origin/source of the various organizational policy related issues.
6. Prioritization of issues.

STEP 2 : Policy Instruments/Sources

1. Legislation and Govt. Policy and Priorities

2. Taxation (the budget)
3. Persuasion (the public pressure)
4. Inspection and audits
5. Minutes of meetings
6. Legislature Records
7. Provision of services
 8. Newsletter, media briefings and community meetings

STEP 3 : Policy Analysis

Costs and benefits of various alternatives or to evaluate the validity of existing policies. Eg.
Forcefield Analysis

STEP 4 : Stakeholders Engagement

1. Extensive consultation and co-ordination between the various stakeholders

2. Interest Groups (Civic Society, associations and lobbyists)
3. Public participation

STEP 5 : Policy formulation and taxation

Policy recommendations are normally drafted by senior managers and then referred to higher
management authority for deliberation, approval, and adoption.

STEP 6: Policy Analysis Process

1. Identifying the underlying values and aspirations

2. Understand the problem in context
3. Identifying the alternative courses of action
4. Decide which dimensions of the problems are most important
5. Predict the likely outcomes of different courses of action
6. Measure the chosen courses of action against important values and aspirations

STEP 7 : Evaluation

It means how well a policy is working

ROLE OF STATE IN ECONOMIC DEVELOPMENT

1. The govt. has merged as an active participant in the process of economic development
in many ways. Now, the govt. has started participating increasingly in the productive
 activities and through its monetary and fiscal policies are guiding the direction of
economic activities. It also determines the distribution of goods and services in the
economy.

2. In underdeveloped countries planning is not limited to intervention but is regarded as

necessary condition for economic development. Since sources are scarce in UDC’s it
becomes necessary to plan their distribution among various projects as well as plan
their utilization in these projects.

3. The role of govt. in economic development is enormous not only as a regulator but
also in law enforcement, the provision of education, health and economic
infrastructure.

4. Neoliberal institutions, politics and ideas hold a dominant position in much of the
world today. In its most general meaning, neoliberalism refers to the view that the
state should play a very limited role in the economy. According to this view, if the
state largely reduces from economic life, the results will be an optimum of efficiency,
income distribution, and technological progress. The state as an economic factor is
seen as inevitably a source of corruption, inefficient allocation of resources, arbitrary
redistribution of wealth, and obstruction of economic progress.

5. State’s role in economic development should contribute for job creation, industry
diversification, Business retention and expansion, protect the local economy from
economic downturns by attracting and expanding the countries major employers, raise
in public revenue and improved quality of life.

6. In spite rhetoric from the market fundamentalists post 1990, the role of state in
economic development continues to be central across the globe. The role has evolved
from a long period, particularly following world war II, of the dichotomy between the
state and the market characterized by phases in which the state reigned supreme in the
economy to periods where the market was supreme in the economy to periods where
the market was supreme and those were the two were equally esteemed. Instead of
the total rollback of the state in economic development, the relevant question now is :
what is the appropriate nature and scale of state intervention desirable for economic
development ?

7. The direct interventionist state is associated particularly with the economic

development of the some east Asian countries, particularly south Korea, Singapore,
and Taiwan. In these countries the visible hands of state were creatively and
innovatively contained with the invisible hand of the market in order to achieve the
required economic development.
8. The role of state in economic development may be facilitative in nature, in which case
the private sector sets the pace and direction of economic development while the state
plays the subordinate follower position.