Monday March 27, 2023

Ostentatious elite at the cost of indebted masses

February 07, 2023

LAHORE: The present government is lingering the International Monetary Fund (IMF) talks knowing well that wasting of time is against our interest. The IMF has cornered us and we cannot escape the harsh conditions set by the Bretton Woods institution.

What the government considers harsh measures are alternatives to even harsher measures that the state is trying to avoid. The harsher measures are in fact the realistic ones that include full documentation of the economy that this or any government lacks the muscle to implement.

Privatisation of loss making entities is the most prudent way to get rid of huge losses, but political compulsions are such that no government would dare to get rid of dead woods like PIA and Pakistan Steel Mills or stop loss making passenger trains of Pakistan Railways or to transparently privatise goods trains.

Every government believes that it would not survive if it imposes documentation in true spirit. The delay in accepting the IMF conditions is playing havoc with our economy. The foreign exchange reserves have also vanished, rupee is constantly under pressure, inflation is galloping, and the pressure to increase policy rates has enhanced.

With rupee trading at extremely low rates, the prices of petrol, edible oil, pulses, and medicines would continue to increase. The longer the delay in signing a deal with the IMF, the higher will be the miseries of the poor.

Every government over the past decade has agreed on implementing the harsh measure that hurt the common man. Increasing the sales tax rate that is already very high is one such measure, increasing petroleum levy is another that is implemented with a so-called ‘heavy heart’.

An increase in power and gas rates has also been agreed on in principle. The government is delaying the announcement of these measures and many more just to show to the public that it is resisting the IMF conditions.

We, in fact are not in a position to change any of these conditions. We cannot go on living on huge budget deficits and heavy commercial borrowing to finance our over the revenue expenditures.

The government seems in no mood to cut its expenditures. Bulk of our population lives in poverty, but a minority of the rich and the ruling elite live like lords. Top bureaucracy enjoys perks and salaries that are twenty times higher than the lowest paid government servant. Naturally the low paid employees would live like the poor, while top rank bureaucrats would continue to live like the ‘viceroy’.

Why can we not cut these salaries and perks drastically? With extra-ordinary

high salaries they have no idea how the poor live.

Why should government offices, even the rooms of SHOs, be air conditioned when 95 percent of the people live without them?

No person employed by the state should be entitled to stay in a house of over 600 square yards with maximum three bed rooms. The presidential palace or governor houses are relics of colonial past; they should be auctioned to overseas/resident Pakistanis.

We do not need a huge Prime Minister House and above that the protocol that the personal residences of prime ministers are accorded. This extravagance must stop. All state dignitaries must live a simple life. Now the IMF has also started questioning the way our bureaucrats live, the day is not far when they would embarrass the ruling elite as well.