Is it time to repair Pakistan’s social safety net?

Before Benazir Income Support Program (BISP) in 2008, Pakistan’s main safety net programs were Pakistan Bait-ul-Mal (PBM) and Zakat, and that too had limited coverage and a limited target. BISP has been a good addition to social safety net programs despite the issues and challenges it has faced in its eight years of existence. Today, the country’s social safety net is largely driven by BISP – the country’s flagship national safety net system and also one of the largest in South Asia.

Being dubbed as the only poverty alleviation program, BISP has been designed with the core objective of consumption smoothening for the poor families and as a cushion against negative economic shocks from global financial crises and rising food prices. Its long-term objectives include meeting the targets of Sustainable Development Goals (SDGs) to eradicate extreme and chronic poverty and raise women empowerment.

There is no doubt that BISP has improved transparency in its processing and distribution mechanism over the years. The latest economic survey (2016-17) highlights that BISP in its initial phase started delivering cash transfers using Pakistan Post. However, to improve the efficiency and transparency of payments to its beneficiaries, BISP started using an innovative payment mechanism in the form of Benazir Smart Card and Mobile Phone Banking on test basis in nine districts across the country. Later, BISP rolled out Benazir Debit Card across Pakistan, which accounts for 97 percent of the transactions being carried out now. The number of beneficiaries has increased from 1.7 million in FY09 to approximately 5.42 million by the end of March 2017. Its annual disbursement has increased from Rs16 billion in FY09 to Rs115 billion in FY17.

Its other achievements during the year include the successful launch of pilot phase of National Socioeconomic Registry (NSER) and completion of Desk Approach – where people self-register via Nadra desks that are set up in tehsils and union councils as opposed to door-to-door surveys – with 89 percent coverage. World Bank has upgraded BISP’s rating as `Highly Satisfactory,’ according to Economic Survey 2016-17, and DFID conducted the annual review (2016) of BISP with an overall score of A.

Does this mean all is good? The BISP is a good program. However, some economists and experts highlight the need to make these disbursements meaningful; for example, increasing the sum from Rs1500-1800 a month to half of the minimum wage i.e. Rs7,000 a month; or some sort of sufficient increase. The reason they highlight is that the poorest of the poor in the country need to be empowered in areas where the government machinery is not performing. The real task of BISP is to provide some sort of a protection against ever increasing inflation, and with existing monthly disbursement sums; it is doing little to do that.

Also where the federal expenditures as a percentage of GDP have grown since the launch of BISP, the provincial governments lag behind; they need to increase their share of expenditure in the poorest of the poor.

Moreover, the social safety net has to be broadened. While there are other components of the social safety net in the country like Pakistan Bait-ul-Mall, Zakat, and Pakistan Poverty Alleviation Fund (PPAF) that acts as an apex organisation carrying out programs through 134 partner organisations, there is a need to bring in aging programs that deliver health care, pensions, and employment insurance to the poverty struck population.