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Dawn Editorial 13 March 2020

Budgeting on anxiety

AS the last quarter of the fiscal year is set to begin, the federal government is starting its conversations around next year’s budget.
This is a crucial time and putting things on the right track at this stage will be critical.
The country is in the midst of a strong macroeconomic adjustment in which progress has been made, but victory cannot yet be declared.
In addition, the spectre of a massive slowdown in the global economy and the COVID-19 related shutdowns that might become necessary in Pakistan if an outbreak is to materialise, have cast their own pall of uncertainty over the prospects facing the economy.
The adjustment has exacted an enormous toll on people and business.
Depressed demand and high interest rates have squeezed many businesses to the point of closure, while high inflation has crippled people’s purchasing power, pushing millions into poverty.
Just as the demands for an end to the adjustment and a return to growth have reached fever pitch around the country, the uncertainty from the impact of COVID-19 in the coming weeks has emerged as a major source of anxiety to further cloud the outlook.
Little wonder then that the budget debates have kicked off, with the finance ministry listing all the constraints to the resource envelope at the outset.
Among these constraints, it has cited the mandatory transfers to the provinces under the NFC award, debt servicing costs, rising pension expenditure, and high allocations for subsidies and income support programmes.
Pressure is mounting on the government to find a way to roll back provincial transfers, and curtail allocations for subsidies and income support programmes.
Pressure is also growing on the State Bank to reduce interest rates to help curb debt service expenditure that has risen sharply with the latest cycle of monetary tightening.
The politics surrounding each of these movements will push some backs against the wall, doubtless, but the will to continue with the adjustment is now virtually gone.
If the government is forced to think of sweeping shutdowns in order to contain an outbreak of the COVID-19 virus, this situation with its significant trade-offs will be aggravated further.
These shutdowns, wherever they have been implemented, exact a steep economic cost with factory closures and supply chain disruptions, but undertaking them is thus far the only known way of containing the spread of the contagion.
In short, critical decisions are lying in wait for the government and it would be a grave mistake to be caught unprepared.
As budget making picks up pace in the days to come, and we arrive at more clarity regarding an outbreak, decisive and clear leadership will be required.
This is not business as usual.
Those who come to the table with no ideas beyond protecting their traditional priorities will be letting their leadership down.

 
 

Spending Rs460bn

WITH a sum as stupendous as Rs460bn — nearly $3bn — at stake, no wonder there is a tussle over it. The amount, of course, is what the Supreme Court had two years ago determined Bahria Town should pay in land settlement dues for tens of thousands of acres it had fraudulently acquired in Karachi’s Malir district. On Tuesday, the federal government suggested before the apex court that a high-powered committee be formed to oversee how the money is utilised. Initially, it had contended that it had the right to any funds deposited in the Supreme Court regardless of the purpose for which they were obtained or deposited. The Sindh government, on the other hand, citing a severe financial crunch and the shortfall in federal revenue due to it, argued its claim to the settlement dues. While the centre has since conceded the right of Sindh to the Rs460bn, it appears determined to have a mechanism put in place to oversee that these funds are spent ‘equitably’ and ‘transparently’. However, according to the Sindh advocate general, the provincial government is chary of any mechanism that would allow the centre to dictate which development projects could be funded with the money.
Frankly, neither side has any claim to integrity where Bahria Town is concerned. The Supreme Court’s damning judgement of May 4, 2018 found Sindh government functionaries wholly complicit in handing over huge tracts of Karachi’s real estate to Bahria for its housing project on the city’s outskirts. The collusion was well-thought-out and brazen in scope. It involved, among other actions, forgery of documents, manifestly dishonest interpretation of relevant rules, and even legislative jugglery to circumvent a Supreme Court order. As for the PTI government, usually so strident about accountability, it appears to have quietly allowed £190m recovered by the UK’s National Crime Agency from Malik Riaz — money “suspected to have derived from bribery and corruption overseas” — to go towards the payment of Rs460bn in settlement dues. In short, this is yet another instance where the long arm of the law seems inexplicably unable to bring Bahria’s owner to account. That said, the federal government’s proposal that a former apex court judge from Sindh head the above-mentioned committee is a sound one. The settlement dues must be judiciously spent for the benefit of the people of Sindh, and those who have suffered at Bahria’s hands. They must not end up enriching corrupt elites.

 
 

Zainab Alert Bill

HUMAN rights activists, conscientious lawmakers and all right-minded citizens of this state welcome the passage of the Zainab Alert, Recovery and Response Bill in the National Assembly. The bill will now be sent to the president for his signature in order to finally become law. In this instance, credit must be given to the human rights ministry for relentlessly pushing for legislation that will help expedite procedures and synchronise the various bodies tasked with recovering missing and abducted children. While child abuse or kidnapping is by no means a recent phenomenon, greater media attention on the issue, along with important advocacy work by activists, and the public’s reaction to several high-profile crimes against minors have all made the passage of the law possible. In particular, the brutal rape and murder of young Zainab in Kasur, whom the bill is named after, acted as a catalyst for this development.
When the bill was presented before the Senate earlier, after the National Assembly first approved it in January, some raised concerns about the fact that its ambit was restricted to the Islamabad Capital Territory. Keeping this in mind, an amendment was introduced to expand its jurisdiction to the entire country. Under the new law, offenders will be sentenced to at least 10 years behind bars, up to a maximum of life imprisonment. Additionally, the government will set up a helpline and the Zainab Alert, Response and Recovery Agency, which will issue alerts on missing children and maintain an online database. Due to previous instances of police inaction, lethargy and insensitivity in handling such cases, they will now be required to register an FIR within two hours of receiving a complaint by parents, while special courts will ensure a trial is completed within three months. Despite receiving an overwhelming majority of votes in the Senate, there was some continued opposition from the usual suspects. For now, however, all victories, big and small, count.

 
 
 

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