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March 6, 2021

Need a ‘Robin Hood’ govt

Business

March 6, 2021

LAHORE: As the poor start losing affordability to governance-failure-caused general inflation, the budgets of these underprivileged segments crash, pushing more and more families to the brink of dysfunction.

As far as the poorest of the poor are concerned they see such increases as an attempt to further curtail their daily food intake.

They can reduce the amount of food they consume if the edible rates go up. In case of higher utility rates they have little choice because they were already consuming the bare minimum electricity and gas and further curtailment is not possible.

Obtaining an electricity or gas connection is an uphill task and they cannot afford the disconnections because of nonpayment of bills.

They again compromise on food intake to ensure timely payment of utility bills. The health of poor families continues to deteriorate as this practice is going on for years without any increase in the earnings of the poor. The education of their children suffers.

The segment living just above the poverty line may absorb the high inflation and utility bills to some extent. This segment tries to save some amount on a monthly basis to be able to buy a home appliance or a gadget for their children after a year of saving.

When confronted with an abrupt increase in prices the savings are no more possible and the plans of the family to upgrade quality of life go in vain. It leaves a scar on some members of the family particularly the children.

The lower middle class segment has to make efforts to adjust as their standard of living starts going down. In fact most of these families had started enjoying small luxuries of life after years of struggle. Amid high inflation and stagnant incomes it becomes impossible for them to maintain their lifestyle.

Their aspirations to graduate from motorcycle to a small car are quashed. In fact they try to save even the motor bike fuel as it goes dear. Some even had to move their children to cheaper schools.

The white collar middle class is worried about the impact of high cost of living on their pride. They earn fixed monthly income that before this constantly spiking inflation was enough for their family to enjoy the semi-luxurious life.

They have to curtail many expenses. But they still do not compromise on the education and health of their families. The occasional dinners in restaurants are reduced to once a month or none at all. Other social outings are also curtailed as these families do not let others know about the financial strains they are under.

The upper middle class is not impacted the same way as the lower segments of society. High prices are not their problem. They could afford it but in the current scenario the curtailment of movement outside Pakistan due to Covid-19 is their main issue. They were used to foreign trips abroad with their families that are now out of question. They now consider mixing with local folks below their dignity.

Their main problems are how to visit their children studying outside the country. As far as the luxuries of life are concerned they enjoy every luxury available in and outside Pakistan. Though they draw monthly fixed salaries, their incomes are so high they are not impacted as severely by price hikes as others.

The richest are immune to inflation. Their incomes rise with every price hike or additional tax. This is perhaps the only segment that has accumulated wealth in the past three years including during the peak of covid-19. The recent corporate results are a testimony to their increasing affluence. They are gaining when most of their countrymen are losing.

It is time our economic planners realised the hardships facing the most people. They should devise policies more beneficial to the lower strata of society than the richest. We cannot afford the elitist culture developed in the last 70 years. This culture would not go away overnight but a beginning should be made by withdrawing all exemptions granted to the elite, by taxing the properties on their actual value and by introducing targeted subsidies instead of general concessions available to all.