By: Kabeer Dawani and Rehan Rafay Jamil
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| A beneficiary of the Benazir Income Support Programme receiving her quarterly disbursement. Photo Credit: Rehan Jamil |
Poverty in Pakistan may more than double, from 23% to 57%, as a result of the Covid-19 shock, according to one estimate from the Pakistan Institute of Development Economics. This is a dire picture and has the potential to undo much of the progress in poverty reduction that has occurred in Pakistan, particularly over the past two decades, unless urgent action is taken by the federal government.
The lockdown versus livelihoods
false binary that has been the primary focus of much public discussion in
Pakistan has missed the larger and more urgent picture. The virus is here to
stay, at least for a year and probably longer until a vaccine is developed,
which means that neither is a prolonged lockdown sustainable and nor will the
economy return to the levels it was at before. In fact, with the impending
forecast for a global recession, Pakistan’s already slowing economy is likely to
contract — the IMF forecasts that
the economy will shrink by 1.5%.
Unfortunately, Pakistan’s poorest
citizens will suffer most in the imminent downturn. This means that our
government needs to take urgent measures to protect the livelihoods of the most
vulnerable citizens. Daily wage earners, migrants, and informal sector workers
must be at the centre of the design of more expansive social safety nets.
In this essay, we note the
shortcomings of Pakistan's existing welfare system in light of the pandemic. We
also highlight the need for expanding Pakistan’s social safety nets in a
systemic way, while learning lessons from past experiences with various
programmes and what has been done in other similar countries.
BISP and Ehsaas Emergency Cash
transfers
The Benazir Income Support
Programme (BISP), Pakistan’s largest federally funded social safety net, has
been at the centre of the federal government’s response to Covid-19. From the
programme’s existing 4 million beneficiaries, the Ehsaas Emergency Cash
transfers has extended one-time cash disbursement of Rs12,000 to an additional
8 million households. These emergency cash transfers are the biggest in
Pakistan’s history and were made possible because the country has developed a
nationwide cash transfer delivery system under BISP including the use of
digital technology. While this is a very positive first step, these one-time
cash transfers must be the start of a more long-term approach to social
welfare, which also reaches segments of the population that do not have mobile
and internet access or national identity cards. Technology can aid public
outreach, but is no substitute for investments in capacity at the local level.
The BISP cash transfer programme
was a significant milestone in establishing Pakistan’s limited welfare
architecture. The scale of the programme has been an important step to redefine
the social contract enshrined in the Constitution which calls for the state to
protect its citizens from risks. There are many lessons to be learned about how
BISP became Pakistan’s largest safety net, adopted by three successive elected
governments since its establishment in 2008. Perhaps one of the most important
lessons was that targeting needs to be well-designed: BISP developed a poverty
registry known as the National Socio-Economic Registry (NSER) from which
beneficiaries were selected based on welfare indicators known as a proxy means
test (PMT). BISP has also undergone rigorous third-party evaluations; there is already some evidence
that shows the programme has had impact on nutrition and increasing consumption
for some of Pakistan’s poorest households. The programme’s exclusive targeting
of women has also been a 'paradigm shift' in addressing the social rights of
Pakistan poorest female citizens, millions of whom have received social welfare
for the first time in their lives.
However, the Covid-19 pandemic
also exposes the limits of Pakistan’s existing welfare architecture. While the
government has previously focused on excluding those who it classifies as
ineligible for BISP, there is now an equal need to focus on 'errors of
exclusion'. In other words, there is a need to reach out to those citizens who
should be in the safety net but are excluded for some reason, such as those
without mobile phones or national identity cards. The urban poor and migrant
workers who come to Pakistan’s cities to seek casual employment are likely
suffering the heaviest brunt of the lockdown and slower economic activity, but
will largely be unable to access any welfare scheme. Already, a survey
conducted in April 2020 by Dr Farah Said and her co-authors found that
for small-business owners in Punjab and Sindh, household income had fallen by
90%.
While the expansion of BISP and
the additional one-time emergency cash transfers under Ehsaas are an admirable
step, given the grim circumstances, these measures in and of themselves will
not be sufficient for the aforementioned reasons. There is an urgent need to
think more ambitiously about systemic approaches to expanding social safety
nets given the pervasive effects of this shock. Importantly, Pakistan must move
beyond the standard announcement of ad hoc 'relief packages', which are
frequently given to rent-seeking industrialists and business interests, or
relying on small donor funded pilots that end when funding dries out.
Expanding Welfare Provision
Beyond Cash Transfers
Ensuring food security and
employment for the poorest citizens must be the federal government’s urgent
priority in the coming months and years. This is no small task and requires
careful planning, new and creative ways of targeting those who are outside the
safety net, and an unprecedented fiscal commitment to social welfare expansion.
International experiences have shown that public works programmes, where the
state employs people for various projects, and food distribution programmes,
such as providing meals to school children, have been immensely successful in
expanding welfare nets. Out of the box thinking is needed to come up with
suitable long-term programmes for Pakistan’s context.
In neighbouring India, the
foundation of a rights-based welfare system was put in place after 2005, which
could play a vital role in addressing the devastating impacts of Covid-19
there. Two key components of India's welfare system are the constitutional
guarantees of right to food and the right to work. To make these social
entitlements actionable, two programmes were established: a minimum guarantee
of food through a nationwide food distribution network known as the Public
Distribution System (PDS), and the National Employment Guarantee Act (NREGA),
which guarantees a hundred days of employment to India’s poorest citizens.
Activists and leading economists in India are now calling for their government
to expand the PDS food allocations and the number of days of work provided by
NREGA to give relief to India’s vulnerable daily wage and migrant workers. In
Bangladesh, a similar public works programme provides employment to seasonal
agricultural workers during the lean season for rice growing in October-
November when there is a dearth of rural employment and concerns about poor
families’ ability purchase food supplies.
In Pakistan, despite the
successful implementation of a national cash transfer programme, there is no
equivalent public works programme to ensure that those who have lost their
livelihoods can obtain critical employment in the difficult days ahead. There
was briefly an experimentation with the Peoples Work Programme (PPP) in the
1970s, however, lack of proper oversight and poor design resulted in a largely
unsuccessful programme that was subsequently disbanded. Past experience with
social welfare programmes, such as Zakat and Bait-ul-Maal, also shows that
poorly designed programmes can divert social transfers away from their most
deserving recipients.
Similarly, with regards to food
distribution, Pakistan lacks a national system for food distribution, despite
large government procurement of wheat and subsidies for agriculture. The public
utility stores, which are also heavily subsidised by the federal government, do
not benefit Pakistan's poorest citizens. The more recent Ehsaas-Langar
programme simply does not have the outreach to effectively address the scale of
malnutrition and hunger prevalent in many parts of Pakistan, which is likely to
exacerbate by the impact of the Covid-19 outbreak. According to the Demographic
and Health Survey 2017-18, nearly two in five children are stunted in
Pakistan, whereas research by Haris Gazdar and Ayesha Mysorewala suggests
that 30% of the population experiences hunger.
In numerous countries, public
schools provide mid-day meals to students, making the public school an
important component of the welfare system. A similar programme in Pakistan
could ensure public-school going children receive a simple but nutritious meal.
There are many examples of countries of similar income levels to Pakistan that
have developed such programmes, which indicates that it is possible if the
political will exists to change Pakistan’s spending priorities and expand the
country's social safety nets.
Coordinating Federal and
Provincial Welfare Responses
Since the passing of the landmark
18th amendment, a substantial portion of social welfare provision, including
healthcare and education, has been devolved to the provinces. As a result,
there has been an expansion in provincial social welfare programmes reflecting
regional priorities. The government of Punjab has run a girls’ education
stipend programme to improve enrollment levels for female students, Sindh has
extended microcredit to poor women and is in the process of developing a social
registry to address hunger and malnutrition prevalent in the province. At the
same time, Khyber Pakhtunkhwa has expanded health insurance to its poorest
citizens. These examples of provincial social welfare are important, but also
underline the fact that the provinces simply do not have the resources or
existing programmes in place to address the challenges for welfare provision
that Covid-19 has created.
The concerns about insufficient
federal government support to the provinces in responding to the outbreak were
echoed in a recent session of the National Assembly by a cross-section of parliamentarians,
and these concerns need to be taken seriously by the country's policy makers.
Covid-19 provides an important opportunity for Pakistan to expand and
consolidate its fractured welfare system. Numerous governments in Pakistan have
expressed the desire to build a welfare state, but those rhetorical appeals
seem hollow unless supported by concrete steps to expand the scope of
Pakistan’s limited existing safety nets. The Covid-19 pandemic has resulted in
a complex public health, economic and social crisis that requires our
policymakers to act decisively and build consensus to develop well-designed
programmes that complement rather than compete with the existing welfare
programmes at both the federal and provincial levels.
The BISP, which was also established
amidst a global financial crisis, has been an important experience for Pakistan
in building a credible national social safety net. It is now time to build on
the lessons of BISP and think about additional long-term programmes that will
address the pressing health, employment and hunger concerns for Pakistan’s
poorest citizens. Evidence from across the globe shows that well-designed
social safety nets not only play a critical role in reducing poverty, but also
help strengthen fractured national solidarities and citizenship in new
democracies where the social contract between the state and citizens has been
weak. The costs of ignoring current welfare challenges will be devastating for
Pakistan’s most marginalised citizens unless new and ambitious public policy
measures are taken.
