ISLAMABAD: Apply a fair sense of political economy and you will arrive at the following question: Is the decision of the Supreme Court at the end of Panama Papers case going to help those in power make a judicious use of the budget and public money?
Ever since the court took up this case, the most important issues coming under discussion were tax evasion by the prime minister, suppression of facts about his income, forensic investigation to determine the money trail for the purchase of London flats, capacity of the court to determine the facts and the intensity of tax evasion, money-laundering and financial crime, and determining who is to bear the burden of proof in arriving at a conclusion.
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These aspects are so complex that even a keen observer will lose sight of the real issue: Would a decision in this case, in any manner and to any extent, help Pakistan correct its system of budget spending and revenue collection?
Remember, when there were protests by an opposition political party against the delay in launching the case hearing, the most important point raised was to put an end to the plunder of public money through a fair trial.
If this is the prime purpose of an investigation into the assets of prime minister’s family, why are the observers losing sight? Because the case is too technical and keeping track of it is exhausting.
The prime minister can lose his political face, if this is the minimum penalty in the case; the maximum could be attachment of assets, a prison term, or both. If the case concludes with none of the above consequences, the premier may gain politically and stay financially healthy.
Most observers may expect bigger consequences of the case. They may not settle with a conclusion that hurts neither the opposition nor the prime minister or his family.
However, those honestly thinking of bringing dividends to Pakistan and securing its economic future could want major corrections in governance, court litigation and financial institutions.
When such correction was sought by an opposition politician through the Panama Papers case, most observers focused on the possibility of holding the prime minister accountable and recovery of the plundered money.
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They did not buy the proposition that there could be some correction in the system if the court took a decision that could have a wider impact. Courts are known for setting precedence of a long-lasting nature. There are some incidents in history that impacted the political and financial systems to a larger extent than previously conceived.
It is this consequence the proponents of a technical hearing of the Panama case may have been in their minds when they campaigned for a trial that should conclude with punishment to the mighty for having concealed their income, plundered national coffers and indulged in money-laundering. They also believe that the punishment will trigger a process of correction in governance, financial institutions and court litigation or the justice system.
Financial institutions, courts and political parties are required to take a coordinated approach for fair and pragmatic governance to achieve the goals of progress and democratic functioning.
Political fights, indeed, play a role in giving a fresh impetus to the correction phase when coordination among institutions is stuck in the rust of incompetence and criminal conduct. Court cases are important when the state is unable to conduct a fair audit of its revenues and spending, and could not introduce economic intelligence and regulations to prevent pilferage.
Court decisions with a larger impact help in encouraging national aspirations and fair institutional practices if the institutions are ready to correct themselves.
Are the institutions like the Federal Board of Revenue (FBR), ministries of finance, commerce and industries, FIA and others ready to seek a politico-economic self-correction?
Is this issue being raised as fervently as the conclusion of the Panama case? I don’t think so.
Most of the bigger problems in the system are because of waywardness. The focus is largely on the political correction and fairness, not institutional correction. How should this correction begin and become a national issue of bigger importance.
A saner use of the budget and the public money needs institutional correction, not just a court decision.
The writer has worked with major newspapers and specialises in the analysis of public finance and geo-economics of terrorism
Published in The Express Tribune, February 13th, 2017.
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