July 10, 2006	Monday	Jumadi-ul-Sani 13, 1427

CENTRAL planning does not suit developed free markets where giant business corporations and financial institutions can do without it.

In emerging markets where the private sector is not strong, lacking resources and sophisticated market skills, it tends to lean heavily on development strategies and policy framework evolved by the government.

But the strategic or centralised planning is often confused with controlled or command economies. And perhaps it is this confusion that explains the state of affairs in the Pakistan’s Planning Commission.

With the country moving towards the free market, not much attention has been paid to upgrading the Planning Commission with skills required for new emerging challenges. Even in areas where it was supposed to have acquired better skills over the years, lapses abound. This is evident in the formulation and implementation of Public Sector Development Programme (PSDP) .

It’s critics say that the Commission has failed to fulfill the very necessary conditions for running an organisation effectively.

This, they maintain, has led to faulty planning in PSDP funds utilization, appointments of project directors, preparation/completion, evaluation and monitoring of various development projects.

This criticism is mounting in the face of failure in following monitoring procedures relating to the PC-1, PC-2, PC-3, PC-4 and PC-5 of development projects which are approved every now and then by the central development working party (CDWP) and the executive committee of the national economic council (ECNEC).

To begin with, one wonders as to why development projects worth about Rs3 trillion were approved during the last eight years when the government did not have enough financial resources to execute them.

The planning of any project starts with the formulation of PC- 1 (project concept). Later, attention is paid on PC-2 involving feasibly of projects. But nobody seriously follows PC-3 which concerns monitoring, and PC-4 and PC-5 which relate to completion, evaluation and accountability reports of projects. Thus, it becomes difficult to assess the economic and financial return of any project.

Insiders say that approval for any project is a normal exercise but afterwards that the project is dumped. It surfaces only when certain interest is shown by any concerned ministry/department and that too on the pressure of a legislator or an official.

In this connection, examples of projects like Saindak, Ayub Medical College etc, are quoted often. The cost of projects continues to escalate between approval and the actual time for their execution.

“In fact, one should raise a question as to why there is so much delay in the completion of these projects. But I think nobody seems to have any interest except in retaining his/her job”, an insider said.

He quoted the example of former chief economist of the commission, Dr Pervaiz Tahir who was transferred recently because he refused to agree over the 10 per cent reduction in poverty.

In the backdrop of the performance, some people question the need for the Planning Commission. Although the issue of disbanding the Commission had been under consideration of successive governments, no final decision has ever been taken in this regard.

According to a former senior official of the commission, he had to face an embarrassment when he dared to ask during a meeting with donors representative as to, “what sort of an animal you have in the form of a Planning Commission”.

He was told that there were no such planning commissions in the developed countries, including the US and Canada and why should a poor country like Pakistan have such a commission, especially when it does not deliver”.

“The commission’s utility lies only when there is a long-term planning, otherwise there is no justification for it “, he said. The work of the commission, he said, could be done by the concerned ministries and divisions as the sponsoring agencies of their development projects.

The controversy over the funds utilisation has always been a problem which cannot be defended by officials of the commission. Reports suggest that for most part of the year, budget utilisation of funds under the PSDP are deliberately restricted to 60-65 per cent.

However, when the financial year is about to end, last minute disbursement are made hurriedly just to show that funds utilisation was up to the mark. However, ministries and divisions spend this money—disbursed in the month of May and June— only to buy new office furniture, etc.

Why does not the commission raise its voice when the finance division fails to make timely disbursement for the projects. This is not a new issue. Nevertheless, powerful political, civilian and military groups get their development projects approved along with the timely disbursement of funds.

In most of the cases, these funds are released not on time with the result there is always a delay in the project execution while the cost of project keeps escalating.

Appointment of project directors is another intriguing issue and the international donors keep on pressurising the government to appoint them well before the start of the project.

Here too, the bureaucracy plays its role only to ensure that its blue eyed boys are made projects directors because they are offered hefty salaries along with other benefits which they do not get under the normal circumstances.

The defunct Social Action Plan (SAP) worth billions of rupees met with the worst failure because of the delay in appointing of project directors, their controversial performance and their indulgence in corrupt practices. That was why, the World Bank withdrew its $50 million assistance from SAP funding and diverted it to drought-hit areas and for education purposes.

Time has come when the government should stop claiming about the ‘strong economic fundamentals’ and pay more attention towards improving its development strategy so that only the viable development projects are approved along with timely disbursement of funds.

Whether this should be done by the commission or any other organisation is an issue that needs to be looked into by the higher authorities. But this job cannot be done without ensuring accountability at all the development levels of government.

Since general election is scheduled in 2007, the PML government, it is said, is always after the announcement of more and more development projects. “PML legislators are not interested in the actual execution of such projects but only political mileage”, said a concerned official.