Budget 2007-2008 around the corner

Qudsia Kadri

As the government and Islamabad have remained eagaged primarily in dealing with the judicial crisis, the Lal Masjid fiasco, the political uprisings, the conflicting media curbs over ethical and biased reporting on the electronic media, all seem to have put the budget on the back burner. The recent pre-budget presentation in Karachi arranged by the press information department to be addressed jointly by Dr. Shamshad Akhtar and Dr. Salman Shah had only the former addressing while Dr. Salman Shah was replaced by Naveed Ahsan the Secretary General Finance. It has been noted that the advisor to the ministry of finance has avoided the Karachi press during the past year at many forums. A recent gathering of the financial community addressed by the Mayor of London along with a team of important U.K business houses and business community was chaired by Dr. Shah. However, before the question and answer session had begun Dr. Shah decided to leave. Whatever the reason's might be, the daily focus is now very much on the ministry of finance and its economic wizard's.
The media seems quite unsure of its financial reporting status and budget discussions on television seem to lack depth and are treading rather pensively. But, this is the time when both print & electronic media must put down suggestions, the expectations of the masses the socio-economic problems being faced by the people of this society and country to the budget makers. This paper has over the past few months regularly and religiously tried to highlight the economic scenario and the impediments in the way, through our editorials and columns.
Today, it is of little doubt that the deterrent to the professed high rates of GDP growth has remained unmatched to the rising unemployment and poverty in the country. If there are no reported deaths from hunger in our country, it is due to the large-scale private philantrophy and charity in Pakistan. It cannot be denied that a large number of people are mal-nourished, have poor health, lack of education and no housing or roof on their heads, clear drinking water and basic sanitation remains a far fetched dream not only in rural but also in urban Pakistan. In technical terminology we are told by experts that 40% of Pakistani's live below the poverty line___ at less than 1 US $ per day. And if we were to raise the amount to the meager sum of 2 $ a day, than the number falling below this sum could possibly be 80%. The depressing scenario increases if we see where we stand in terms of human development index (HDI) even in our own region, we see dismal results in the recent human development index of the South Asian region.
WE stand much below our neighbor's according to the report. The human resource development has never really taken off, and that is primarily due to the high rate of illiteracy and the meager amount allocated every year to the education sectors. Last year the amount of only 2.5% was allocated from the GDP to education, which by any and all given standards is very low indeed. As a result the overall literacy rate of 53% conceals both urban and rural differences as well as male and female contrasts.
If we move on to health, then again we are looking at dismal figures, life expectancy at 64 is amongst the lowest in Asia (and let us not be fooled here by claiming that we have to our credit, the fact that we are better off than Nepal and Bangladesh).
The infant mortality is also the highest in Asia (74 per 1000). Mortality rate under 5 (98 per 1000 is also the highest in Asia). Requirement for poverty alleviation would be to increase public sector expenditures on health, housing (here it is imperative to mention that Rozgar and Khushali's schemes have not provided or eased the housing availability for the poor). It is seriously recommended that both the federal and provincial governments should hold back on building of Gulbergs, DHA's, Bahria towns and the KDA's to facilitate the rich and powerful and our various housing schemes should be immediately used to help the poor homeless and the lower middle classes to attain shelter. Resources must also be set aside to regularize and improve the Katchi Abadis instead of eroding and removing the Abadi's without any alternate facility.
It is also strongly recommended that land reforms act must be implemented. The "feudal King" have shackled the poor and have kept them enslaved to toil on their lands without any emoluments. For society and the country to develop it is necessary to bring about structural land-reforms in order to get rid of the political stronghold of the feudal class.
Progressive taxation of income and property should be introduced. The rich have over the years been extended many concessions and benefits, many times in the garb of private investment, which has largely remained elusive. Such conspicuous consumption reaches a point where it is all pervasive. Our budget-makers have to realize that the time has come to transfer at least some of the benefits to the poor. After all, if society provides an opportunity to the well-to-do to make money, it is quite fair to ask the high income-bracket earners and the owners or palatial houses to pay more to the state.
The exact opposite can be seen in our country, the disappearing middle class and salary earners because of the pre-ponderance of the indirect taxes end up sharing the major burden of taxation. It is time that this trend is reverted.
We must advocate and put forward the regional inequalities between the provinces to be addressed through a judicious distribution of wealth. The disparity not only between the rich and poor but between the remaining four provinces has to filled. The federal government living in its make-believe euphoria cannot control all the resources_____ about 80% in Pakistan. The present practice of distributing the current and development funds have led consistently to regional disparities in the levels of development and provisions of basic social services. The criteria of poverty levels, the total lack of infrastructure in different parts of the country should better capture the needs of population and perhaps form the basis for distribution of resources. It is high time that an independent and professional NFC award should address the highly "fragile" and perhaps "volatile" situation in the provinces. The spirit of accommodation from the federal government must replace acrimony amongst the federating units.
It is time that Islamabad the President and Prime Minister and his cabinet address real-life situations and facts affecting the populace of the country.
An approximately 2 trillion budget might highlight a very impressive figure but post budget scenario will give rise to a "reality scenario" in a not very condusive political judicial scenario.
It is time that the government sharpened its watch on the macro-economic situation and its far-reaching consequence during the present fiscal year.