Prime Minister Shahid Khaqan Abbasi last week retold Pakistan’s economic success journey under a democratic government to global investors at the World Economic Forum (WEF) in Devos. Back home, however, a debate seems to be stirring on the quality of growth and governance.

Globally the issue of wealth and income disparity has gained traction.

The Oxfam report released recently, that showed economic returns were increasingly concentrated at the top, informed discussions on the theme ‘creating a shared future in a fractured world’ at the WEF.

An argument was made based on the WEF’s recently released Inclusive Development Index 2018, that aside from GDP there are multiple metrics that can be used to determine the success of economic policy and institutional strength in a way that can contribute simultaneously to higher growth and wider social participation.

This Index reflects more closely the criteria by which people evaluate their countries’ economic progress. Out of 74 emerging economies Pakistan ranks 47 on the index. (See Figure 1 and Table 1)

Like elsewhere in Pakistan, the stance of the government towards the equity dimension of growth appears to be critical for the future of democracy and stability.

There have been several cases (Zainab, Naqeeb and Intezar) during the closing month indicative of the trajectory of events in the country going forward.

The public patience to tolerate the mistreatment of vulnerable and the inaction of responsible authorities is running thin. Even the fragmentation of society has not stopped civic activism for a just cause. In the current environment all that is needed is a spark to let loose public wrath for economic injustice.

An extreme example of the systemic exclusion of the voiceless from sharing the growth benefits in Pakistan is the recent case of ex-bank employees who have been fighting for fair pension in courts for over a decade

An extreme example of the systemic exclusion of the voiceless from sharing the growth benefits in Pakistan is the recent case of ex-bank employees who have been fighting for fair pension in courts for over a decade.

A little after President Mamnoon Hussain’s remarks in favour of pensioners in 2016, the Supreme Court took Suo Motu notice of the issue. The final decision in the pension case is expected in the ongoing week.

According to details, four out of five of the country’s biggest banks have a pension policy. MCB switched to a provident fund scheme to contain its long term liability and the National Bank of Pakistan revised pension rates upwards.

But after privatisation the other three banks: UBL, HBL and Allied Bank Limited (ABL) froze its inherited employees’ pension in 1991 and have not revised it since. As a result retirees, including officers, have been drawing a monthly pension in the range of Rs800 to Rs2,500 whereas the salaries of the top tier executives run in millions.

A member of the legal team representing the pensioners confirmed to Dawn that on January 18 the Supreme Court reserved its decision in the case. It gave banks 15 days to draw a scheme providing relief to retirees with retrospective effect.

Sharing the development of the case’s proceedings a source privy to the whole affair said the bench, which included Chief Justice Saqib Nisar, during recent proceedings was visibly irritated over the apathy of banks’ management and dismissed the plea of legality of the current arrangement.

“Seema Kamil, President UBL was reprimanded by justices in court when she tried to defend the banks viewpoint,” a lawyer present during the concluding proceedings privately told Dawn. “She contested the perception that the salary of banks’ presidents was over Rs10 million per month and stressed that it was hardly one-third the amount (Rs3m) on average,” he shared.

Responding to a Dawn query, the State Bank of Pakistan (SBP) responded in writing thus: “The pensioners have already approached the court of law for redressal of their grievances and a Suo Motu action has also been taken by the Supreme Court. Any action, if required on the part of the SBP will be complied with accordingly.”

On intra-bank wage disparity the SBP acknowledged the problem and maintained it was trying to address the issue. “In terms of the applicable laws, rules and regulations, the banks’ Board of Directors are authorised to devise remuneration policies and structure. The SBP encourages fair and transparent practices and has issued instructions viz. ‘Guidelines and Disclosures on Governance and Remuneration Practices’ in this respect.

“One of the objectives of these guidelines is to minimise pay-gaps and discourage the concentration of benefits to the top cadre or certain class or group of employees,” it said in its mailed message.

The banks’ management involved in the case were evasive. Ali Habib, head corporate affairs, UBL, told Dawn that the bank had nothing to share with the media regarding the case at this point. “The matter is sub judice and it would not be proper comment,” he said over telephone.

Banking Mohtasib Aneef ul Husnain was not in office for health reasons. Some other officers reached declined to record their position. A senior member said that the pensioner’s case falls beyond the mandate of the institution. “We are authorised to deal with bank customers and account holders’ complaints. Worker relations do not fall under our purview,” he said.

“Corporate practices including wage structures are exemplary in multinational companies. They treat their workers well and invest in skills development. The MNC’s expansion shows that it is a winning business strategy,” said a corporate lawyer who retired from a FMCG giant.

Talking to Dawn, Adil Mehmud, 82, who retired as a vice president in 1995 after serving the bank for 36 years, expressed hope. “The wrong is about to be set right. In the end I will die a content man if the Supreme Court succeeds in making banks pay what is our due: a little respect and pension that covers for basics,” he said.

“The pension that was less than half that the government pays to menial worker was more of a punishment,” he added.

“Democracy has failed people thus far. The private sector is not expected to always be socially responsible. There is no defence for regulators falling short when it comes to protecting worker interest.”

“To avoid the dangerously uncertain course of disruptive justice the systemic flaws in structure that serve to deepen inequality needs to be addressed and rules that make private companies socially responsible and promote an ethical corporate culture need to be enforced, instead of using CSR as a marketing stint,” warned an analyst.

Published in Dawn, The Business and Finance Weekly, January 29th, 2018