Budgeting in the dark

Published: May 20, 2015
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The writer served as Executive Editor of The Express Tribune from 2009 to 2014

The writer served as Executive Editor of The Express Tribune from 2009 to 2014

No annual budget — federal, provincial or even local — based on a population census as outdated as the one that we have been using since 2003, the year the 1998 census had expired, can be regarded as a balance sheet of income and expenditure worth the bother of a serious debate either inside the elected Houses or outside. At best, the successive annual budgets passed since by elected Houses or non-elected governments were no more than fictional balance sheets and, therefore, they naturally ended up adding to the national woes rather than alleviating them. Add to the fiction the fact that currently, the black economy is almost more than double the white in size and you further end up looking at a fantasy and not at a realistic account of what is proposed to be earned over the next 12 months and what heads would be allocated what amount.

No matter how you try to manage your economy at the official level, there is no way you can come up with a policy that is equitable and ensures equity across the board if you don’t know how many mouths you need to feed in the coming 12 months, how many bodies need to be clothed and how many families need to be provided with shelter. And it becomes even more difficult, nay almost impossible, if you don’t have a documented economy informing you precisely how many persons there are earning taxable incomes and how many of them are paying their dues and how many are evading and avoiding their national financial obligations.

A state which does not fulfil its very basic obligations towards its citizens like providing all of them, especially the indigent millions, affordable food, potable water, electricity, affordable education, affordable health cover, affordable transport, travel and telecommunication facilities, affordable housing, affordable justice, adequate protection of their lives and property, even affordable bank loan facilities, can hardly qualify to be called a legitimate state demanding loyalty from all of its citizens. Such states are called failed states because their citizens don’t feel a sense of belonging to them and refuse to hand over to the agencies of these states some of their individual rights for the collective good of the entire citizenry of the state.

Like in the past, this year as well the budget-makers are groping in the dark. And like in the past years, they are likely to come up with an over-ambitious sized budget, allocating overly impressive amounts for development while announcing the budget, simply to play to the gallery. And since they do not know what resources they would be able to mobilise over the next year to fund their ambitious budgetary allocations, they would, as has been the rule, use the rule of the thumb and come up with an equally ambitious amount under this head of income.

A country without adequate capital of its own, without enough of its own energy and lacking in modern technological know-how, can hardly be expected to be able to make ends meet without a generous dole from multilateral and bilateral sources. But most of this dole comes with strings attached which are normally designed to keep the dole recipient in a perpetual state of bondage of the donors. One can escape this bondage, if one wants to, first by negotiating the right kind of dole and then investing it in productive avenues rather than in non-productive heads like buying weapon systems and importing consumer goods.

Unfortunately, Pakistan has been doing exactly what it should not have been doing all these years. The billions that we have spent on buying arms did not improve our sense of security but instead kept our economy trapped eternally. In fact, today we are much more insecure than we were at the time of our independence. The main reason being, our continuous neglect of our own people. Had we invested most of what we had earned and received by way of dole over all these years on our own people, in educating them, training them in various productive trades and sciences and improving their intellectual prowess, then perhaps, we would have been much better off today both economically as well as security-wise.

Published in The Express Tribune, May 20th, 2015.

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Reader Comments (5)

  • imran
    May 20, 2015 - 5:41AM

    absolutly agree…. may this article would read our financial minister and pmRecommend

  • John B
    May 20, 2015 - 8:57AM

    One cannot prepare food without knowing how many mouths to feed. Approximation can go only so far in food preparation as well as in population statistics, and it will lead to wasteful spending.

    Often the borrower blames the banker by misspending the borrowed money by living beyond the means and in vices. And the vices and mismanagement are rightly stated here. However, many countries have borrowed money and used it for infrastructure and human capital investment and have made progress and paid the debt. In PAK case, the fault lies with every GoP and not with the banker.

    “today we are much more insecure than we were at the time of our independence. …..Had we invested……..on our own people, in educating them, training them in productive trades and sciences and improving their intellectual prowess, … we would have been much better off today” – True, but it should also be pointed out that the present state is due to two generations of neglect and none of the human capital investments discussed above can be time crunched. They will need another two generations to develop and one more generation to see the tangible benefit. That time frame is approximately 75 years into the future to achieve what is expected in today’s world and that luxury of time for PAK is at the mercy of events that PAK cannot control.

    Rome was not built in a day is a cliche, but it should be noted that it was also not destroyed in a day. We are lamenting here the destructive direction of PAK, means to stall the destruction and approaches to rebuild PAK in the future. Current efforts are geared towards stalling the destructive path, only.

    Investment in human capital resources brings, attracts and even creates wealth out of thin air.

    PAK can say that they are better off than the others, but one should ask on what scale and compared to whom and is PAK better off today than it was, say, fifteen years ago? Quality of life better today than it was 20 years ago?Recommend

  • Fahim
    May 20, 2015 - 4:29PM

    Disagree, we have to defend ourselves first else we would be like Lebanon, syria, Iraq. Kindly give suggestions to your beloved friends USA, Israel and IndiaRecommend

  • Tousif Latif
    May 20, 2015 - 7:35PM

    This is a country for the elite.They are enjoying a fabulous life style.Our government is well aware of their needs and judiciously allocates and releases extravagant funds for them.Investing in poor is always a menacing proposition for an elitist mindsetRecommend

  • Woz ahmed
    May 21, 2015 - 4:40PM

    @Fahim:
    Well said.

    Defence and resulting debt has crowded out investment in social and physical infrastructure, otherwise we would have a smaller more affluent population and an Asian tiger economy.

    But defence is paramount and we must be prepared to eat grass to protect ourselves from threats within and outside our borders, we know the cost, but it is the path we have chosen.Recommend

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