Watching Poverty Grow

Electricity bills go up, so do gas prices as Pakistan government announced the budget for 2009-10. Expenses allocated by the budget include 0.2% for health-care, 0.8% for education and 12% for the army. Expenditure allocated for debt payment is the only item that consumes more than the army’s share.

For now, the army is working for the money they make but their influence on the political set-up is obvious by the chunk of budget allocation they receive compared to the necessary public expenditure that keeps getting postponed. The minister, in her budget speech revealed that the war on terror has consumed 35 billion dollars. Americans paid ten billion and who paid the rest is everybody’s guess.

Most ironic is the exorbitant increase in the price of electricity. The whole city of Karachi was without power for longer than 24 hours. Load-shedding of electricity for a few hours daily is the norm, all over the country, but consumers will see a minimum raise of one thousand rupees on their monthly bills.

Government has ear-marked Rs. 70 billion to be distributed to the poorest families. The program called Benazir income support fund would give $12.50 (one thousand rupees) per month to 5 million families who have no income. Close to a quarter of the 170 million Pakistanis live in extreme poverty.

Almost 75% Pakistanis live on an income below two dollars a day. Access to health-care is hard and expensive. Middle class in the cities cannot afford necessary health-care. For the large majority, government hospitals are the only resource and they are far and few and they lack instruments, supply and service. The amount of Rs. 6.48 billion allocated for the health sector cannot improve on the provision of health-care.

More than half of the Pakistani population is illiterate and Pakistan has existed for sixty-two years. Numbers speak for the government’s in-attention to this vitally important sector. Following the US gesture about aid being directed towards public sector, the allocation of a meager 0.8% for education is pathetic.

Pakistan’s Rs.2.9 trillion budget relies on foreign aid and the government plans to seek help from IMF, in case the aid does not come through on time. This budget projects a deficit of 4.9% and IMF had restricted Pakistan to keep it below 4.6% so the government intends to borrow to make up for the difference. Broadening the Tax base by including agriculture would be a far-fetched expectation from the government of feudal-lords. Agriculture contributes 22% to the GDP and yields only 1% of the revenue.

Rs.655 billion will be given to the provinces in 2009-10. The year before, provinces were promised more in the budget but received around Rs.600 billion. In 1948, sales-tax was taken over by the federation from the province because building an army was vital for the country. Provinces have been complaining of usurped rights and the budget could be the right occasion to announce concessions but a National Finance Commission is set to begin after a few months. Integrity of the country could depend on these issues but government has not shown any urgency.

Generations of Pakistanis are condemned to a life-time of hard labor on empty stomach, to pay for the war, army, ministers, senate, parliament, international aid, loans and donations, and they will remain indebted to the donor countries without receiving a dime of help. The military and their feudal allies borrow on behalf of the people to keep their business running while the people sink deep in debt and poverty.