Report card: Pakistan below average in budget transparency

The country has got worse in recent years and was outperformed regionally.

ISLAMABAD: Pakistan scored less than satisfactorily in budget transparency and grabbed 56th position amongst the 94 surveyed countries, as the government was found providing minimal information about the budget and financial activities, revealed the Open Budget Survey 2010.

The Open Budget Survey, which was launched here by the Omar Asghar Khan Foundation, showed Pakistan scored 38 out of 100 which is less than the average score of 42 for the 94 countries. It was also the second worst performer in the region, followed by Afghanistan which scored 21.

The survey was carried out by the International Budget Partnership Organisation. The Open Budget Index is used to gauge the level of transparency among the nations and is one of the 38 indicators used to measure governance.

“Pakistan’s score indicates that the government provides public with minimal information on the central government’s budget and financial activities,” say the findings, adding that “it makes it extremely difficult for citizens to hold the government accountable for its management of the public money.”

According to the survey, the budget proposal documents are not sufficiently comprehensive. The documents lack detailed information that can help explain the relationship between the fiscal revenue and expenditure plans. Furthermore, the documents also lack information on certain fiscal activities and policy goals.

“The information on extra-budgetary funds, quasi-fiscal activities, tax expenditures, contingent and future liabilities” is missing from the budget documents, according to the findings.

Another worrisome aspect was that Pakistan’s performance on the Open Budget Index has been falling over the years. In 2006, the country had obtained a score of 51.

This year, regional peers performed much better than Pakistan. Both India and Sri Lanka had obtained a score of 67 out of 100. Bangladesh obtained 48 and Nepal secured 45. The worst performer was Afghanistan in the region with 21.

“An emerging consensus is that instead of the executive, budgetary decisions must be taken by parliament but another question is if parliament is well-informed or not,” said Dr Pervez Tahir, a former chief economist of Pakistan.

Information about budget is provided to parliament in the first week of June, he said, adding that parliament must digest 13 documents and deliberate in three weeks what the finance ministry does in nine months. The country’s financial year starts in July and the finance ministry starts budget exercise in October.

Published in The Express Tribune, December 9^th, 2010.