Given that they affect everybody government budgets are never something one can ignore except at great peril. The curious and the optimist look forward to the day when the government will reveal its latest update of its vision for the economy and unveil the various interventions it plans to correct the course it is projected to take. Salaried people and pensioners look forward to an announcement of relief that will provide them some respite however short lived. Those lobbying for various causes wait with baited breath to discover whether or not their efforts to influence the government have borne fruit. Opposition groups prepare to challenge the government on its accounting of its performance on one hand and its recipes for the future on the other. The chronic pessimist dreads the announcement of yet more taxes or withdrawal of subsidies and benefits.
The federal budget this year has several firsts and a slew of rare standouts – some of them not quite of its authors’ making. How often does a parliamentary opposition agree with the government not seeking a vote on cut motions? How often does a federal government advise the federating units not to rely on its resource projections and base their plans instead on their own experience and intelligence? How often does a government provide a stimulus package and austerity measures at the same time? How often is an IMF-approved stabilisation regime expected to produce growth? How often does a tax free budget project to increase the revenue by a quarter?
As experts point out this year’s budget is the second in a row for an elected government with the economy facing a slump. The stimulus package, it turns out is a misnomer as the government is committed really to an adjustment trajectory. The revenue targets are so shaky that even the government has had to advise caution in relying on them, which raises questions about transparency and constitutional guarantees.
The government has described its effort as crisis management – a crisis rooted in the coronavirus pandemic situation, which has made the entire world to pause and take extraordinary measures. Given the pandemic situation, which has so far shown no signs of improving, health is clearly the top agenda item.
In this the provinces and territories have followed the Federation’s lead. Lacking resources to factor in Covid-19-related spending for an entire year, the provincial governments have chosen to focus on development programmes to revive economic activity and on social protection measures to mitigate the impact of Covid-19 for those living below poverty line.
Also, despite its reluctance, the government’s hand appears to have been forced in finally announcing a plan to privatise Pakistan Steel, which in turn has revived a debate over pros and cons of privatisation to remedy inefficiencies and corruption in state owned organisations. Read on.