| October 1, 2003 | Wednesday | Sha’aban 4, 1424 |
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Benazir Bhutto’s gambit
Missing refunds
DURING the last nine months the Executive Committee of the National Economic Council (ECNEC) has approved 72 public sector development projects costing a total of Rs314 billion. The first batch of 25 projects costing Rs68.52 billion was approved in April this year. The second lot of 19 costing about Rs48 billion was approved in August. On Saturday, ECNEC approved a third lot of 28 projects costing Rs193 billion. The sectors which have been chosen by ECNEC for budgetary attention are understandably energy, communications, water, education, health, information technology, rural development, devolution and agriculture. These massive allocations for undertaking so many public sector development projects should be a matter of great satisfaction for those who have been pressing the government over the past four years to do something big and soon to arrest the declining investment rate and escalating unemployment levels.
However, most of the projects included in the approved list of ECNEC have three to five years’ gestation periods. So, all of them will have to go to the National Economic Council each year before the finalization of the annual budgets to be considered on the basis of their position on the priority list of the government and the availability of funds in that particular year. So, what has been approved by ECNEC during the current year may not necessarily come up for consideration over the next five years. This has happened in the past as well. Successive governments have used the ECNEC platform to gain some short-term political mileage by announcing the approval of projects worth billions of rupees knowing very well that the resources needed for implementing them may not be available for many years to come. Consider, for instance, the case of the already approved 10 mega irrigation and water storage projects costing a total of Rs454 billion against the total projected availability of Rs118 billion by 2011. Consider also that the water sector projects already in hand costing Rs150 billion too may have to be delayed depending on the availability of this paltry sum.
Many of the water-related projects which we hear about so frequently have been on the planning list over the last several decades. To be fair to the past governments, they presented these projects religiously every year to the Aid-to-Pakistan Consortium in Paris only to be allowed to take in hand those projects which the donors found to be capable of generating employment and aiding growth in their own countries. The latest example of such a practice has been the decision of the US EXIMP Bank to make available huge sums of money to Pakistan to purchase costly passenger aircraft from an American company. However, going by the claims of the present government, the level of Pakistan’s dependence on bilateral and multilateral donors is no longer what it was until the 1990s. Not only that it has foreign exchange reserves of over $11 billion but as of today, it seems to have successfully turned the corner on exports and revenue income fronts. So, it should not be too difficult for the government today to make use of these advantages to overcome the disadvantage of declining investment and rising unemployment. One only hopes that while expanding public sector investment in priority projects, monitoring of implementation will be ensured to eliminate waste and delays.
IS People’s Party leader Benazir Bhutto providing an opening for a compromise with the government? She said in Washington the other day that her party could lend unconditional support to the government on certain issues such as the joint electorate, women’s seats and devolution of power (presumably the local government system). On other issues relating to the LFO there could be conditional support. Ms Bhutto also said a formula could be worked out to provide indemnity to President Musharraf in return for indemnity for herself. She also appeared to back sending troops to Iraq on the conditions outlined by the president and indirectly supported military action in the tribal areas to flush out Taliban and Al Qaeda elements.
Now, Ms Bhutto made these observations while in Washington. Therefore, some of her conciliatory remarks could be meant for the ears of the Bush administration, which is solidly behind Gen Musharraf and would probably want some kind of a political concordant in Pakistan that includes the PPP and which enables the general to rule without undue disturbance. The PPP leader might also have been seeking to interpose herself as a player when the government-MMA talks seem headed for a conclusion. Irrespective of that, however, Ms Bhutto’s statement, which she made to Washington-based Pakistani reporters, needs to be seen in perspective. It has always been obvious, except to the establishment, that a sustainable political system cannot function without the consent if not the actual participation of the PPP and the PML-N, the country’s largest parties. General Musharraf has been dismissive and sometimes even contemptuous of the two parties’ leadership in exile — and certainly both Ms Bhutto and Mian Nawaz Sharif have much to atone for. But the same holds true of so many now in power, and surely there is much room for negotiations and doing business at least with the PPP and PML leadership within the country. The present artificially created system is simply not working. A sincere effort needs to be made to lessen the hostility that marks relations between the government and the mainstream parties. Ms Bhutto, conscious of the blow dealt to the struggle for democracy by the death of Nawabzada Nasrullah Khan, might well be trying to point the way to reconciliation.
SOME 3,000 applicants to the Islamabad New City (INC) housing scheme, who had deposited their first instalment for land purchase in 1996, are reportedly still waiting for a refund from the National Housing Authority despite the shelving of the scheme over five years ago. There were two phases in this scheme, one of which was handled by the Capital Development Authority (CDA) and the other by the National Housing Authority. Applicants who applied in phase two, which was handled through the CDA, have had their payments refunded while those who applied in phase one of the scheme, which was under the purview of the NHA, are still waiting for their refunds. The scheme was launched amidst much fanfare in 1996 and many people applied on the understanding that since two government organizations were involved, their investment would be secure and they would get their desired properties within the time frame promised. However, this did not happen: with the change in government, the scheme was cancelled.
Ever since then, a section of the investors, which comprise mainly retired government employees, have been running from pillar to post to get their money back. One pertinent question they ask is who has control of the money that they deposited with the NHA? Till recently, the housing ministry had acknowledged that the money was indeed with them and would be refunded. In the past few months, the ministry has once again adopted delaying tactics and says it does not have funds for the refund. If this is the case, then one must ask where the money has gone. The trust that people have in government organizations and agencies which launch housing schemes has eroded owing to the INC fiasco as well as the unfortunate Malir housing scheme in Karachi where refunds were given after a passage of several years and a lot of hue and cry. As the government has launched an ambitious housing policy this year, it will be appropriate to work quickly to resolve the INC issue which will indicate that it is indeed serious about providing low-cost housing to citizens.