The Finance Minister said in his budget speech yesterday that the entire Federal PSDP, for the outgoing fiscal, has been released and utilised. Not really, because as of yesterday, the Planning Commission is yet to release nearly a quarter of its mandated funds disbursal limit of Rs.228.4 billion. But the Ministers assertion reveals more: no cuts in development funds and speedy disbursals come in next fiscal year.
The size of the Federal PSDP has been increased by 20 percent for next year. That a whopping 96 percent of development funds have been earmarked for project nearing completion signals the governments intent to achieve as much semblance of development as it possibly can.
A deep look at the FY13 PSDP projects is telling. Under Special Programmes - a euphemism for political schemes - Rs.27 billion have been allocated, which will be spent through the cabinet and finance divisions. The National Highway Authority, which deals with the construction, maintenance and upgrading of roads, highways and motorways, has been allocated Rs.50.72 billion: More roads and bridges!
Within the allocation of Rs.13.6 billion, the finance division will be taking care of development packages in political hotspots like Multan, Lyari, Hyderabad, Jamshoro and Nawabshah. The Interior Division will get Rs.6.5 billion, Rs.2.7 billion of which will be spent on some Safe City Islamabad Project. The Capital Administration and Development Division, having no jurisdiction outside Islamabad, will get Rs.791.5 million.
Development funding for critical areas remains abysmal. The National Food Security and Research Division will receive Rs.495 million from development funds, but not a single project has been started that could lessen the hunger and food insecurity, when every other Pakistani is food insecure.
The Climate Change Division has been allocated Rs.135 million, bulk of which will fund a "Global Change Impact Studies Centre". One struggles to find a project even remotely related to floods mitigation and disaster risk reduction. Far from promoting the IT sector, the Rs.787.4 million appropriated for the IT and Telecom division will take care of governments connectivity and automation requirements just fine.
The budget has been heavy on populist measures. The subsidies in energy and agricultural sectors are set to continue. Government officers salaries and retirees pensions have been raised by 20 percent. At a cost of Rs.9.5 billion, one lac unemployed, educated youth will be provided with work and skills development opportunities through internships and technical trainings.
The income tax exemption limit has been enhanced to Rs.4 lac for salaried class, business individuals and Association of Persons. The allocations for BISP - governments leading social safety net - have been enhanced by 40 percent to Rs.70 billion. BISP cardholders will also get a special discount of 10 percent at utility stores on essential food items, for which the government will set up another 2,000 USC outlets.
Pakistan desperately needs to revive growth, create jobs and arrest its populations descent into poverty. Yet the political elite chose to miss the opportunities this budget presented to introduce structural reforms and revert to good governance. After all, Pakistan is well into an election year, and somehow it is deemed neither honest nor lawful to distribute electoral goodies through state resources while appeasing various constituencies.