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May 30, 2020

Shallow resource pool & deepening fiscal problems

Business

May 30, 2020

LAHORE: The pool of available resources would be substantially shallow next fiscal, while provinces would need much more than this fiscal’s allocations, as besides highly expensive coronavirus management, they also face the Herculean tasks of rehabilitation of dilapidated businesses and alleviation of runaway poverty.

The handling of pandemic has not been exemplary. It was dominated by the federal government that trespassed the territories reserved for the provinces. Health and education are purely provincial issues amongst so many others.

Post-pandemic or even during its existence the provinces would need much higher resources than they ever had. As things stand now, it looks that their resources would be much squeezed as they mainly come from federal tax revenues. The only way forward is a tight cooperation between federal and provincial governments and a complete elimination of wastages and leaks. The pandemic might have presented us with the best chance to operate efficiently.

The federal government does not have the capability or capacity to reach and treat the virus affected population. This job must be done through the provinces. In the same way the provinces have their independent ministries for industries. They regulate and maintain the industrial estates, formulate and implement labour laws, build infrastructure. Connect industrial estates with national highways, ensure proper transport system to commute workforce. The provincial governments are responsible for the food security. They have to manage slums and provide sanitation facilities for the poor dwellers. They are also responsible for the welfare of the poor.

We have a staggered welfare regime where some tasks are performed by the provinces and some by the federal government. Social security departments that operate under the ministry of labour in all provinces provide health and to some extent education services to the ‘registered workers’ and their families. The federal government collects old age benefit fund from businesses to dole out pension, after age of 60, to the workers whose contribution has been deposited by their employers. The federal government also distributes some amount monthly to the poor families through Benazir Income Support Programme or currently launched Ehsaas programme.

Post-pandemic we would need full transparency in all affairs where the workers are facilitated through public money. We will have to introduce simple technologies to ensure that no bogus claims are entertained, and no undue favours are given.

The execution should be through the provinces. It is because Pakistan is a federation and mostly the provincial governments are formed by parties that do not enjoy power in center. If the federal government doles subsidies or cash throughout the country; it could create a soft corner among the electorate for the party ruling in the center. Moreover, there is a possibility that that favour would be executed through party workers to curry the favour of recipients.

We all know that none of these welfare initiatives are operating efficiently. There is a separate force to execute each of these initiatives. Ideally all these tasks could be performed by each province. The federal government should keep an oversight on the performance and distribution with the help of technology. The huge amount reserved for Ehsaas or BISP, in fact, comes from taxpayers’ money. The federal government has no right to claim the credit for distributing this amount. The money with the list of beneficiaries should be passed on to each provincial government. The names of each beneficiary should be available at a specific website of federal government and easily accessible to all.

The provinces would be bound to distribute the amount according to the list provided to them. The NGOs (nongovernment organisations) should guide the beneficiaries of their rights to eliminate fraud. If some poor are left behind the province itself should provide the same amount to them and send their credentials to the federal government that could include them in the next budget. In the same way the provinces could ask the federal government to remove the names of the underserving persons from the list with proof of their affluence.

As far as the social security registrations are concerned the name of each person registered with the provincial social security department should be placed on the website of provincial labour department along with the name of the employer.

The civil society and nongovernment organisation could probe them to find out how many workers have not been registered. Even a worker employed in the defaulting company could ask the social security department to register him and many other missing colleagues. The name of the whistleblower should be kept secret and a complaint could only be lodged at the highest level.