Accountability is something people do fear. Bureaucrats, politicians, businesspeople and others appear to be in the grip of this fear. Politicians are experiencing it for decades and for them it’s now business as usual. Businesspeople have been consistently and plausibly arguing that one factor which is inhibiting business growth and investment is the fear of high-handed accountability carried out by multiple investigating agencies. Bureaucrats too have voiced their concerns in this regard, giving air to their real and perceived grievances against NAB. They are therefore reluctant to take categorical decisions or initiate meaningful actions.
Piqued by this impediment to country’s economic growth, the incumbent government has initiated some measures to overcome it but in a selective manner.
The significant rollout is the proposed bill aimed at making the central bank fully autonomous and providing immunity to its top officials, including governor. “No action, inquiry, investigation or proceedings shall be taken by NAB, FIA or provincial investigation agency, bureau, authority or institution by whatever name called without prior consent of the board of directors of State Bank,” according to a clause in the proposed State Bank of Pakistan (Amendment) Bill 2021.The same clause will also be applicable to SBP’s former directors, governors, deputy governors.
Likewise, the State-Owned Enterprises (Governance and Operation) Bill 2021 has sought indemnity for the directors, Chief Executive Officers (CEO) and other employees of SOEs from any legal proceedings. The proposed law explicitly states that “no suit, prosecution or other legal proceedings shall lie against the directors, chief executive officers, or other employees of a state-owned enterprise if the liability arose out of an act or omission of the director, chief executive or employee and the act or omission was done in good faith and with due care”. It is important to note that the Pakistan Stock Exchange (PSX), too, has proposed amendments in its regulations with a view to insulating its directors and others against liability.
Bureaucrats, being left out, now have a strong case to demand concessions similar to those offered to SBP employees. The SBP existing rules state: “Every [person in the service] of the Bank shall be deemed to be a ‘public servant’ within the meaning of Section 21 of the Pakistan Penal Code’. Accordingly, at present, SBP employees fall within the definition of ‘public servant’ and so do the other public servants in different tiers of bureaucracy.
The USA, the UK, India and all other vibrant economies have even stronger investigating agencies but nowhere do businesses suffer nor do public officers work under any fear of undue accountability or harassment. One needs to evaluate why the situation is so dreadful in Pakistan? Is it because of the fact in these countries the accountability process is judicious, meaningful and devoid of harassment, political score settling and extortion?
The PTI government has offered a number of financial incentives to industry and real estate. The incentives offered for real estate development are unprecedented in the history of Pakistan. Unfortunately, however, this sector has failed to demonstrate the level of buoyancy that it should have. It remains sluggish with mega project developers sitting on the fence holding on to their cash. The main reason cited is the fear of harassment by the investigating agencies.
The government is currently in the phase of offering selective immunity. This may turn out to be counter-productive on account of others being left out in the closely-knit fraternity of bureaucracy. The core purpose of accountability in the country appears to have lost its meaning and has spun out of control. It lacks public confidence. All big ones and all others who can want to move out of its radar. It’s about time the government came up with an even-handed strategy on accountability through an act of parliament.
(The writer is a former President of Overseas Investors Chambers of Commerce and Industry)
Copyright Business Recorder, 2021