In the mad media rush to get vox pops on the budget and sound bites from politicians, an MNA from the MQM remarked how it was impossible to fashion a “people’s budget” until it has been made by the true representatives of the people. That it was impossible to expect one from a feudal.
The legislator was half-right. Not about the feudal bit, though; the f-word has been played with for longer than it is worth. The “feudal” finance minister is far more receptive to criticism from harsh detractors than those who call the shots in Karachi. The MNA was right only in the observation that it is impossible to make a people’s budget. For there can’t be a people’s budget till the people themselves proclaim it to be so. And that they won’t. This is not a comment on the quality of the budgets (though they have, collectively, left much to be desired) but on the near impossibility of any measure of approval from either the people or the media on a subject that is not clearly understood by either of them. Even if a government were to make a criminally populist budget, the commentariat would histrionically lament that the wretched of the earth have gotten nothing. The people, far more intelligent than the media, would, eventually, find out but only much, much later. Not at the time of the budget.
The above stems from the difficulty inherent in correctly understanding any budget. It is difficult to make sense of what this-much-for-this-and-this-much-for-that actually means, that too in the context of the existing economy, the socio-political space where the money is to be spent and the pressures of global economy. Even some members of the PML(N), which brewed up a storm on the floor of the house while the budget was being presented, conceded that the protest was not at the budget per se but, you know, generally…
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The budget itself: the government has set some rather ambitious targets. Suffice to say, it will miss most of them. A harsh pronouncement, yes, but it is really not believable that the government will achieve the quantum of revenue it is eyeing without taking some drastic steps. Yes, the removal of GST exemptions from certain items might net them a little here and a little there but anything short of the RGST won’t yield much. And, as, again the MQM, has made it clear, the RGST is going to be opposed tooth and nail if it comes up, dressed as anything, in the finance bill.
Yes, the government is slashing certain subsidies, but the shortfall in revenue is going make it unlikely to meet the fiscal deficit target of 4.6 per cent of the economy. The government is going to finance the deficit by, among other things, borrowing from the central bank, which will fuel more inflation.
But that won’t be the only factor causing inflation. The age of cheap food and cheap fuel long since over, the international markets for grain and oil are going to be as unforgiving as ever. The government’s subsidies on oil, at least, should indeed be slashed as it is going to be increasingly unsustainable to do so.
To segue into penchants unsustainable, the military got a 12 per cent budget hike. True, there’s a war going on but even the most casual of glances at the military budget would attest that the boys club was already being well compensated for that. The subject under discussion is the budget and not the dispensation of power within the state so let the digression be succinct: it would do us well to realise that if one wages war against the laws of economics, the laws of economics will win.
More on the war against terror: it is sad that the budgets of civil law enforcement agencies like the police, who have lost far more men and whose services are internationally recognised to be far more vital for our war, have been slashed. This attitude towards a set of organisations that is not playing any double game in the war against terror? Strange are the rules of the school of the world, muses the poet Momin, the student who learns his lessons well, never gets a day off.
Our development program, the PSDP, has seen a substantial increase. Speculation abound that the next budget is going to see an even higher increase for political reasons. That is probably not an apt prediction. It makes more sense for a government to undertake more development programs earlier on in the term so they can be completed in time for the next elections. Populism in the last budget before the elections might not see more programs but more subsidies. Unless the programs in question are, in effect, targeted subsidies, like the Benazir Income Support Program of the federal government or KP’s Bacha Khan Khpul Rozgar Scheme.
Budgets are that time of the year where the political opposition lets the country down. By way of not providing much opposition. The rumpus in the assembly? That wasn’t opposition. That was frothing at the mouth; a throw of the bangles here, a flashing of a nan there. Until the political class seriously gets down to figuring the budget out and cuts out the ill-informed populism, and effectively articulates what exactly it is they have a problem with, we’re none the better for any amount of brouhaha they might conjure up in the house.