December 30, 2002	Monday	Shawwal 25, 1423

What is the single point agenda for Mir Zafarullah Jamali’s government — as soon as it stabilizes? An effective, well-financed and no-nonsense thrust to stem the rising tide of poverty. The poor are 72 million, or half of the 145 million population of Pakistan.

Their number continued to grow whether the “incompetent” politicians ruled the country or the “competent” khakis. And, now we have the mix of the two. If they decide, they should be able to deliver. Should everyone now earnestly desire it, the task of confronting poverty can be taken straight-on. Otherwise time waits for no one.

Remember, in Greek mythology, time is symbolized by an unruly horse who has a bunch of hair on his forehead. One has to catch the horse by these hair—upfront, if you do have the courage. If you don’t, you fail and your name and fame, if any, will be consigned to the dustbin of history as it happened to a string of others in the last 55 years. And, in confronting poverty, Jamali, a good-hearted man himself, will be opposed by none.

In fact, alleviation and reduction in poverty may prove to be the elixir of life for his government. It is so because none of the political parties and groups in the National Assembly can oppose such an effort. The Muttahida Majlis-i-Amal, which apparently has the largest number of lower to lower-middle class MNAs in its fold, except for a handful of filthy rich operators in their ranks, will surely support. The PPP, with or without the fourth or the fifth “P” at its tail-end, dare not face it. If any of the Chairman Zulfikar Ali Bhutto’s spirit is still left in the PPPs, they must remember that it was his own widely propagated, but unfulfilled 1970 slogan of the ‘roti’, ‘kapra’ and ‘makaan’ on which the party and those claiming loyalty to him still thrive — and get votes.

If the PML (Q), the MMA and the PPP MNAs join hands who can abort their anti-poverty moves? This, as such, is the test for all the three, and others will follow, or perish. In fact, if this agenda is genuinely implemented, it will by itself, consolidate the government and the National Assembly most of whose members are still an unknown commodity. The urgency to stress the need to even belatedly tackling poverty is the latest well researched and documented: “Pakistan Human Conditions Report 2002”, (Conditions-2002) prepared by a group of earnest, knowledgeable and kind-hearted economists and experts. While the Islamabad-based autonomous group called the Centre for Research on Poverty Reduction and Income Distribution (CRPR1D), was busy in its travails to unmask the fullest and the gravest face of poverty, I, you may call it, frustratingly, kept telling several of the groups members that they should not waste their time and effort. My argument with them was that a pile of such reports, ranging from the government commissions, private research organization, Dr Mahbubul Haq’s Human Development Centre, now diligently being piloted by Mrs Khudija Haq, to the World Bank and the IMF publications, have been painstakingly urging all governments and Pakistanis to come to grips with the poverty.

If it was done 20 years ago, the magnitude of the problem was still manageable. Now, unfortunately for the latest crop of politicians can be summed up in a single word: daunting. The CRPRID Group that compiled Conditions-2002, included: Tariq Hussain, Advisor to the CRPRID; Shehnaz Wazir All, Executive Director Pakistan Centre for Philanthropy; Mutawakkil Kazi, Secretary, Planning and Development Division, Dr A.R. Kamal, Director PIDE, Fateh M. Chaudhry, former Senior Adviser the World Bank, and the honorary Advisor Ministry of Finance; Dr G.M. Arif, Senior Research Demographer, PIDE; Dr Sarfraz Qureshi, Director of Dr Mahbubul Haq Human Development Centre; Dr Talat Anwar, Senior Economist the CRPRID; Dr Mushtaq A. Khan, Director the CRPRID; and Abdul Hakim, Director National Institute of Population Studies.

Why poverty rose as sharply as it did, despite all the governmental claims of reducing it ? While most claims of a reduced population growth have generally remained a mirage, the GDP has gone down, even according to government statistics. Between 1960-1990 and 1990-2002, the GDP (factor costs), at an annual average, declined from 5.8 to 4,2 per cent, agriculture from 4.3 to 3.5 per cent, manufacturing from 6.6 to 4.8 per cent, commodity production from 5.4 to 3.9 per cent, and services from 6 to 4.6 per cent. Between fiscal 1993 and 2000 the labour force increased from 32.5 to 39.4 million, unemployment more than doubled from 1.5 to 3.1 million, and the unemployed rate rose from 4.7 to 7.8 per cent, according to government statistics unmindful of the surging sea of the jobless, who, in fact, are estimated at 12 million.

How poor were the poor and what do they suffer? One indicator is inflation and the general price index. It shot up from 100 in 1991 fiscal to 233.3 in 2001, while price of fuel and lighting rose from 100 to 255.6 during the same period. ‘Whatever marginal growth took place during all these 12 years or so, did it impact the poor? The answer is largely: No, because the growth was not pro-poor. In fact, poverty increased during the period when the country was “implementing” the World Bank-funded Structural Adjustment and Stabilization Programmes (SASP). There were five of these programmes, including those before the nuclear-sanctions and after, and covering 1988-91, 1993-96, 1997-2000, 2001, and 2001-4.” It is, generally believed that these SASPs have led to low levels of investment and the GDP growth and that the policies designed had an adverse effect on the poor. Besides, inconsistency, lack of continuity of the policies has also contributed to the slow rate of investment and growth of the GDP.

While demand management is absolutely necessary for stability of the economy, it is a painful process as it can result in the loss of incomes in the transitional period. And when it is accompanied with structural adjustment it becomes even more agonizing. Half-hearted attempts made in Pakistan to pursue such programmes may have prolonged sufferings,” says A.R. Kamal. This is precisely what happened. While the effort stayed fruitless, the sufferings of the poor grew intense, besides enlarging their numbers. While the growth was declining, the squeeze hit the already vulnerable hard. The economy was in a recessionary mode, the public and development spending was down, the private sector was not to forthcoming. What was needed was private sector development, better management of public expenditure, tax reforms, to create fiscal space for public sector management and private sector development, and the necessary institutional development to enable these actions to take root. But, it did not happen. As a result, and in the absence of such an environment, the rate of investment, its effectiveness and efficiency did not rise. Which is why a higher rate of growth did not materialise.

“Human poverty is not what people do or do not have, but what they can or cannot do to participate fully in the life of the community, is the evolutionary, dynamic concept (of poverty), as it defines the needed capabilities in the context of the changing environment’, says “Conditions-2002.” The centre has worked out the number of the poor on this expanded, and internationally accepted, basis.

It says, for the poor to benefit from the economic growth, it is necessary that they are enabled to participate in the economic activity via increased employment. Returns from the productive use of physical assets—land, shops, services. Returns from the productive use of human capital — education, technical skills, experience.Improved health status-nutrition, health care preventive and curative. Improved access to “environmental infrastructure” — safe drinking water and sanitation, clean air inside homes, in work places, in public areas — both as a human right and in order to reduce the unacceptable levels of morbidity and mortality. Provision of credit to enable them to create assets — both physical and human — and to extract returns from these assets. Reduction of gender disparities. Reduction of rural-urban disparities. Reduction or even rich poor disparities. Provision of social safety net for the vulnerable. These ad up to what may be described as pro-poor growth. But, the above objectives cannot be implemented without significant reforms in Pakistan’s institutions of governance, — political, civil service, judicial and corporate,” and above all the rule of law to ensure that these things do happen.

Above the jangle of political jigging and rejigging, and comings and goings of various parties and groups into and out of the Jamali government, is anyone listening? Jamali’s first action of a 12-paisa per unit reduction in electricity tariff, and the proposed cuts in gas, sugar, cooking oil and water sound good. But its a drop in the ocean of poverty. Can all the parties, in or out of thee government, form a “bipartisan” approach to attack poverty — and not the poor?