SHAHBAZ SHARIF'S AVOIDABLE BLUNDER
By Dr Pervez Tahir

[The writer is a former chief economist of the Planning Commission. This article first appeared in Dawn on April 21, 2009.]

Most analysts cite Punjab's Sasti Roti Scheme to supply the staple at Rs2 as a success story. There have been demands by people in other provinces for the same access to this basic need.

Even the prime minister has spoken of inter-provincial discussions on the scheme. While other governments weigh the cost of emulation, the khadim-i-ala of Punjab went a step further to announce a lower price of Rs1. There has been an uncharacteristic retraction since, portending a big blunder.

To ordinary folk, good governance effectively means affordable access to roti. In his famous letters written to Jinnah to convince him to return to India from England to lead the Muslim masses, Iqbal had talked about the worsening economic condition as roti ka masla. He knew that the masses understood the economic problem only in terms of roti. This was amply demonstrated, after Pakistan, by the demonstrations against Prime Minister Khawaja Nazimuddin. Economic researchers of the period concluded that the major driver of inflation was the price of flour. The most effective public articulation of the problem was witnessed when Zulfikar Ali Bhutto mobilised millions around the slogan of roti, kapra aur makan. The real wages did not fall despite the highest-ever rates of inflation and the first oil shock.

But let it be said that what Mahbub ul Haq would have described as a "direct attack" on roti ka masla was launched by Mr Sharif in Punjab. The level of commitment came in the form of a strong reaction to the allegation by Governor Taseer that the scheme involved a subsidy of Rs6bn. The announcement to reduce the price to Rs1 after restoration was the next logical step. The subsequent backtracking, perhaps on the advice of IMF–World Bank types whose one mission is to eliminate subsidies and resultantly the poor rather than poverty, is sending out a signal so negative that the gains of the price at Rs2 will also be wiped out.

These gains have been enormous — social, economic and political. The scheme has alleviated poverty significantly in a short period. It has improved nutrition, prevented sickness and saved health costs. In its absence, the crime situation would have been worse.

If the people came out in droves during the long march, they were acting to protect their right to eat and survive. By first talking the scheme down and then taking a revisionist position, Governor Taseer had raised the spectre of starvation for those who find it hard to keep body and soul together.

So the people paid back in kind. People do not forgive and forget if the rulers are seen to be saying one thing and doing the other, when it comes to roti. No amount of economic or financial justification works in such cases. It would be a different matter if the announcement had not been made in the first place. Now it would only be perceived as the bureaucracy getting the better of a pro-people political leadership.

The news proves as much, e.g. the industries department prepared the summary under the directive of the chief minister without its ownership; the finance department finds it unfeasible; and that an inter-departmental committee has dumped it. The promise to begin in Ramazan adds insult to injury.

In the absence of credible numbers, it is not possible to say how high the poverty ratio is now. But there can be no hesitation in saying that the poor now constitute an enormous proportion of the population. Punjab holds this mass of the hapless in proportion to its population. At least 10 per cent of the population has nothing to live for. They are voiceless and have given up struggling for anything. Economists would argue that this is the target group to focus on. But in today's dire economic straits, vulnerability extends well beyond the bottom 10 per cent. Access to roti is the best social safety net.

True, the provision of this safety net involves huge subsidies. The chief minister should ask those arguing against subsidy a few pertinent questions. Did they pay the full price of the plots allotted to them? Do they pay full rent for their official accommodation? Do they pay what is economically due as utilities? Who maintains their cars? It cannot be that the subsidies are feasible for the better-off and unfeasible for the poor.

The scheme is also dubbed a political programme. Compared to other political programmes, the scheme makes much more sense. Take the case of the MPAs Programme or the so-called Taameer-i-Punjab Programme. The purpose is to help the MPAs to maintain the confidence of their constituents. What better way to achieve this objective than to provide sasti roti?The money allocated to this programme and many others can be diverted. The MPAs should get involved in its effective implementation. Indeed, the chief minister has already made this a criterion for ministerial hopefuls. He should also not renege on the price. [Courtesy Dawn]

Regards.