WB hails Pakistan’s cash scheme for poor

World Banks says Ehsaas Programme contributes to mitigating the economic impact

ISLAMABAD: The World Bank has hailed Pakistan’s cash transfer emergency programme, saying it would be instrumental in mitigating the impact on the economy due to novel coronavirus.

"Cash transfers will be instrumental in mitigating the impact of the upcoming recession by ensuring that consumption by the poorest and vulnerable contributes to the local economies," the World Bank said in an article published on its website.

It suggested if the fiscal space allowed to the government, the emergency cash transfers should be considered as an optimal option to rejuvenate local economies.

Last month, Prime Minister Imran Khan had announced the Ehsaas Emergency Cash Programme worth of Rs144 billion to disburse Rs12,000 each to 12 million beneficiaries who were stricken hard by the lockdown enforced due to coronavirus leading to worst economic impact to the country.

At a time when cash transfer programmes are the most widely used instruments to counter the socioeconomic fallout from the pandemic, the case of Pakistan provided a good insight to others, the article added. “No doubt this response was one of the best investments that a government could make in a crisis.”

The cash transfers provided purchasing power to people to meet their needs.

According to figures, nearly 24 per cent of Pakistan’s 210 million people are below the poverty line. The country requires a rapid response to protect its poor from becoming even worse off.

The national lockdown imposed on March 13 is a necessary pre-emptive step to contain the health emergency. But it compounds socioeconomic risks for vulnerable people, who have lost their jobs or cannot access health and social programmes.

In addition, the pandemic puts women, who were already disadvantaged in the labor force, at greater risk as they carried the invisible burden of caring for the sick, elderly, and children.

One of Pakistan's initial measures, with support from the World Bank, was to expand its national safety net institution, the Benazir Income Support Programme (BISP), to direct additional support to its 4.5 million women beneficiaries.

The government also scaled up its flagship cash transfer program, Ehsaas Kafalat, to include 7.5 million additional vulnerable families affected by the crisis — thus increasing by 85 per cent its annual budget dedicated to cash transfers.

Pakistan's quick action was possible because the country has invested in programmes like BISP and Ehsaas Kafalat which formed one of South Asia’s largest social safety net systems. They provide quick registration options and reliable payments through state-of-the-art biometric technology. Their online linkage to the national ID database helps prevent duplicate payments while ensuring transparency.

While these investments have achieved results, there was room for further improvement. A move towards a dynamic system for updating the National Socio-Economic Registry (NSER) and integration among social programme databases would help keep targeting data current and ensure a two-way flow of information.

Besides avoiding duplication of effort, a centralised and integrated social registry would also provide data for informed decisions regarding socio-economic policies and initiatives.

Along with this, the federal and provincial governments needed to expand the primary education and children health-related conditional cash transfers to integrate aspects of long-term human development and reduction of inter-generational poverty.