Daily Times

Imran Khan deserves praise for clearly articulating in his very first speech the priorities of his government, empowering citizens through local governments; prioritizing education by re-declaring it as emergency; and focusing on health and nutrition to stop the increase in stunting.

The PM delineated what according to him is considered as a good society. We are living in times of extraordinary political engagement. The hype of having a Naya-Pakistan is at crescendo with hearts brimming with hope. On the other hand, our economic performance paints a grim picture, an IMF bailout, Public Sector Development Fund (PSDP) slashed at federal and provincial level.

In Punjab, alone, there has been a 62 percent reduction in the development grant which in-turn means less money for redistribution to the local governments, which are barely standing let alone performing. How can this be read as empowerment of the citizens and the local governments? The first level of governance interface with the citizens needs more for them to truly feel the change and/or progress.

GDP is a measure of economic performance which does not automatically translate into an indicator of the citizen’s quality of life, quality of opportunities and satisfaction with citizenship. Therefore, it might be a good time to reframe the debate about the much needed development for Pakistan. Should it be a GDP led growth alone or an integrated social progress in parallel i.e. quality of life and quality of opportunities available to citizens?

Kuznet presented GDP as a way to measure a country’s economy in a report to the US Congress after the market crash of 1930. There are many progress measurement indices in the development arena, yet no one index can be taken as the final measure of development. The reason for the same is that the governance of development in itself is layered yet integrated. Therefore, development practitioners end-up customizing as per need. Sustainable Development Goals (SDGs) and its indicators are also an attempt to feed into all linked indices.

The SDGs were globally envisioned in 2015, to move towards making the world a better place by 2030, by addressing global challenges, including those related to poverty, gender inequality, climate, environmental degradation, prosperity, and peace and justice. Millennium Development Goals (MDGs) were its predecessors (2000-15). Pakistan made negligible progress in attaining MDGs except a bit in education.

SDGs have been re-enacted by an Act of Parliament to be the national targets as recognized in the national vision 2030. Development specific fiscal allocations of the government, as well as support of the international development partners, will now be read as an effort against attaining SDGs.

Social Living Measures (PSLM) and Pakistan Demographic & Health Survey (PDHS) are the key to global reporting. These data sets are comprehensive but underutilized, a reframed agenda for development pegged to the SDGs, will guide their optimal use as well.

KP took the route of funding the districts directly; whereas, Punjab had a mixed system with more functions centralized than devolved. In theory, then, KP could rank and hold individual districts accountable on social progress and/ or the achievement of SDGs. On the other hand, in Punjab, it was the provincial government where the buck stopped

Michael Green — a social entrepreneur has taken on the task of disrupting the measurement of the national economy and the income. Instead of GDP, he believes that social progress needs to be measured within the framework of the availability of basic human needs, access to improving well-being (education, health, etc.) and rights and opportunities for the citizens. He packs them as Social Progress Index (SPI). The beauty of SPI is in the simple re-arrangement of the established data sets, instead of breaking away from them.

Greens is emphatic that development in the 21st century needs to be measured in terms of social progress. Prime Minister, Imran Khan seemed to agree in his inaugural speech and put-forth a Naya deal for Naya Pakistan. So, what does it take to deliver on it? Naomi Klein believes the ingredients for an evolutionary leap are imagination and organization.

To get to the Naya deal, requires putting governmental fiscal resources to where our social progress is and finding the right conduit to do that. The organization/conduit to deliver is available through fiscally empowered and functional LGs. For example, KP took the route of funding the districts directly; whereas, Punjab had a mixed system with more functions centralized than devolved. In theory, then, KP could rank and hold individual districts accountable on social progress and/ or the achievement of SDGs. On the other hand, in Punjab, it was the provincial government where the buck stopped. How much of that buck stretched down to Rajanpur, Muzaffargarh and other districts of the south has been a long debated issue generating a lot of noise in the last 5 years too.

Green’s measurements show that in low GDP countries, the impact of each additional dollar on social progress is immense. However, the GDP growth does not automatically turn into social impact unless directed very clearly.

The NFC is the fiscal lifeline from federal to provincial governments on the basis of which PFC is formulated. Each PFCs would have its own formula for redistribution of resources among LGs. For example, Punjab’s PFC has allocated 75 percent weight of ‘population’ in the formula. Whereas remaining weight i.e. 25 percent is distributed between poverty, expenditure needs and cost of service delivery. In order for social progress to be equivalent to the SDGs, it’s not province but LGs that a need strengthened organization and management muscle.

The overarching problem, of reduced fiscal space, though, still remains. The Punjab Cabinet dissolved the interim PFC and revised it in its meeting of Oct 16, 2018. This translated in the slashing of the development grant to Rs 238 billion from a generous Rs. 635 billion, which in turn means reduced fiscal resources available for the LGs. This calls for innovative approaches — e.g. a model of LG entrepreneurship, to realize the Naya deal for Naya Pakistan.

An empowered Nazim with the ability and vision to connect with local business can create additional financing that could be diverted towards social progress. That would build alliances and link contribution to social progress for measuring success of local businesses.

Focusing on social progress as a measure of the Naya deal through the local government; it would lead to strengthened governance — in Naya Pakistan. It would structure fiscal public space, through fiscal decentralization to LGs; would further ensure service delivery and create opportunities by improving the local business climate by creating LG based entrepreneurship.

To quote Klein, “Crises test us. We either fall apart or grow up very quickly” for the Naya deal to be the destiny of Naya Pakistan, the present government does not have a choice but to grow up very quickly.

The authors can be reached at @yazdanifauzia and on @shiringul

Published in Daily Times, October 21^st 2018.