On the contrary, insiders maintain that certain decisions about raising prices of various utilities, which were delayed due to referendum, will be announced before the budget.
The increase in the prices of oil is very much on the cards and it could be announced well before 15 of this month. The upward revision in the tariffs of electricity, gas, telephone, water, etc. are also on the cards. The government says it has nothing to do with the prices of utilities as they have been left to various regulatory authorities which are supposed to determine them.
Generally, it is believed that there will be 5 to 20 per cent increase in prices of various utilities. A decision has already been taken to impose 15 per cent general sales tax on edible oil to be effective from July 1. Naturally, it is going to affect the common man. Also 15 per cent GST has been imposed on medicines except those of life savings. This decision has already led to roughly 10 per cent increase in drug prices by pharmaceutical companies.
The fact of the matter is that during the last two and half years, people has not been offered any relief. In fact prices have become unbearable. Official statements have started appearing in the press that there is no plan to raise salaries of government employees and naturally the private sector will follow the same.
The government maintains that there is a 3 per cent inflation but interestingly the State Bank reports do not believe to be so.
While the common man did not receive any relief and does not have any hope from the new budget, the government had been kind to the rich; that was why the wealth tax was removed. Interest rates on saving schemes have been reduced slashing the income of the wodows and the retired. The reduction of profit from 18 per cent to 11 per cent has caused a decrease of over 25 per cent income to the investors of saving schemes.
Generally, ordinary people complain that they do not get small loans from small and medium enterprise (SME) and from micro finance (Khushhali Bank). Both the institutions have been extending loans but mostly to those who had been recommended by the influential people.
And on the other hand, influential people continue receiving loans from the nationalised commercial banks and development financial institutions. According to the World Bank, the amount of non-performing loans has reached a staggering figure of Rs384 billion. When the present government took over, the amount of bad loans was Rs185 billion and despite conducting ruthless accountability, the amount of non-performing loans kept on increasing. Who are the new defaulters is a question to be answered, specially when there was no significant investment during the last two-and-half years.
During the same period,in the name of downsizing over 200,000 to 2,50,000 government employees and those working in state corporations have been rendered jobless.
The government has been saying all along that unless there was a real revival of the economy, prices could not be reduced. While 9/11 events brought problems, they also brought substantial financial support from the bilateral and multilateral creditors. At the same time Pakistan has been offered unprecedented $ 12.5 billion rescheduling of loans by the Paris Club for 35 years.
This big financial support, specially one billion dollar cash budgetary support by the United States and $ 300 million by Japan did not create any impact on the life of the common man. The government claims that it has increased the development budget from Rs 120 billion to Rs 140 billion during the current financial year.
It has also increased the poverty alleviation funds from Rs. 20 billion to 45 billion. But the question is whether things have changed.Health and education bills of the low income people have created emotional problems and people look more frustrated today then ever before. The number of suicides is unprecedented in the society due to joblessness and high prices. Hardly any day passes when someone does not kill his children and himself due to economic distress.
The educated youth are frustrated because of lack of jobs. Well qualified people,even MBAs and degree holders in information technology, are seen running from one organisation to another in search of jobs.
With privatisation, more and more people will face joblessness.The PTCL is currently employs over 70,000 people and the new buyer, official admit, will remove at least half of them. So is the case in other organisations.
The private sector is continued to be shy due to the fear of accountability to invest new money. There has been $ 5-8 billion flight of capital due to former chairman of the National Accountability Bureau Lt. Gen. Amjad’s drive against businessmen and by the time Shaukat Aziz and Dr. Ishrat Hussain succeeded to have the intervention of the President to halt operations against businessmen, the damage had already been done.
The NAB claims to have so far recovered a little over Rs100 billion but on what cost is a million dollar question.
Although now prudent banking practices in europe,Japan and the USA were forcing Pakistanis to bring their money back, one does not really see the money coming home in large volume.
All said and done the question remains what a common man will get in the new budget. So far promises have been agalore and now it is to be seen what happens on June 15.