EDITORIAL: Punjab Chief Minister Maryam Nawaz may have laughed off her Sindh counterpart’s criticism of the Punjab-only power subsidy, but she didn’t answer his main question. Doesn’t sinking Rs45bn into a package that provides limited relief for only two months fit the textbook definition of throwing good money after bad? The relief package, as it is being called, has caused quite a stir, uniting PML-N’s coalition partners with opposition parties and forcing the prime minister who is also the president of the PML-N to intercede and defend the decision of the Punjab government.
While ordinarily it should be nobody else’s business if the province can come up with the subsidy on its own, but given that it will cut deep into its development budget and possibly upset fiscal arrangements with the centre and the IMF (International Monetary Fund) just when a very crucial bailout programme is being signed, and the fact that there will be nothing to show for it after two months except a corresponding cut in the provincial PSDP (public sector development plan), perhaps those questioning the financial prudence of it may have a point. Besides, it would also cut sales tax revenue for the federal government, which it will have to make up for.
The PM has advised other provinces to follow Punjab’s example as well, instead of complaining about a sense of discrimination and deprivation that their constituents might suffer from. The PM believes that CMs of other federating units should also introduce similar initiatives.
Surely, he understands how much money will disappear into such subsidies at a time when everybody needs to bolster reserves, and that the Fund might have something to say about it also – at a very sensitive time – if it upsets the surplus agreed with the federal government and the lender.
It seems that this measure is an attempt to address the setback that PML-N suffered in the Punjab. Its footprint in Punjab has been receding for the good part of a decade, since before 2018 when the electorate handed it to PTI (Pakistan Tehreek-e-Insaf). Now it’s counting on the feel-good factor from temporary schemes to identify with the needs of the people and recapture its lost backyard, so to speak.
But it is also alienating its own coalition partners as they appear disturbed and offended by this populist measure to bolster its political standing, not even parties that PML-N relies on to stay in government. And, having ruled Punjab for a long time, the party should know how quickly the people – even those who’ll directly benefit from this subsidy for two months – will turn against it once they start receiving inflated bills again. So, all in all, this is a political and financial gamble; a fitting example of PML-N’s effort to recapture lost influence and also its fear that something might be brewing in the people that could push them into open revolt.
Yet, as the Sindh CM said, such situations require long-term solutions, not patch-up jobs; especially the kind that eat up a lot of money and last only a very short while. Steps like this subsidy make a lot more sense when they are part of bigger programmes that roll out in coordinated phases. But the way this one is being rolled out seems yet another example of doing the right thing the wrong way.
Copyright Business Recorder, 2024
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