Daily Times

The Third Industrial Revolution, birthed by global capitalism, brought with it new technologies and the promise of real change. Yet it has failed to deliver on several fronts, such as curbing climate change, the depletion of natural resources and poverty.

Much lip service has been paid to tackling these issues and many social programmes have been instituted towards this end. Yet despite all this, poverty is on the rise, globally, including in affluent western countries. Thus, the gap between rich and poor is widening at rapid pace. Nowhere is this more pronounced than in the developing world.

To address such disparities, the West developed the idea of universal basic income (UBI). Under a UBI (government-run) programme, each individual receives a flat monthly stipend, regardless of employment status. Different schemes outline who is entitled to cash flows. Some stipulate that all citizens are covered, regardless of whether or not they are working and earning an income; while others provide that only those who live below the poverty line are eligible. Similarly, some plans only cover a country’s citizens while others offer financial protection to all those residing within its borders. Therefore, attempting to define the parameters of UBI raises many more questions. The first step, even before determining eligibility, must be to decide on the source of funding, such as super taxes for the rich, for example. Once secured, redistribution of wealth can begin. Revenue through tax collection is abysmally low in Pakistan.

The country is fortunate to have at the helm someone like Dr Sania, who has demonstrated the brilliance and integrity required to run the Ehsaas programme. Both Imran Khan and Pakistan need more Sania-like clones

In Germany, implementing current social security laws is expensive and existing loopholes mean that the system is open to misuse. An individual must disclose all sources of income and property, thereby necessitating a swollen bureaucracy to ascertain social security transfer entitlement. An expanded workforce is needed to verity data alone. People feel overwhelmed by application forms that run into double digit, others feel immense shame at having to declare themselves poor and often refuse to do so. A UBI programme that pays out to everyone, regardless of income or financial assets, would render the entire bureaucracy and support staff redundant. Thus the subsequent money saved from not having to pay salaries as well as office and technology expenses would be injected into the UBI and cover outlays.

The oldest social security programme in the world is the Islamic idea of Zakat. This is an obligatory annual payment under Islamic law that the affluent must make on certain kinds of property. Used for charitable and religious purposes, Zakat represents one of the five pillars of Islam. However, it has never been properly used over the centuries to eradicate poverty. In Pakistan, there have been numerous attempts to use Zakat for the greater good. The latest comes in the form of the Ehsaas programme, instituted by the current PTI government and which is based on its concept of transforming the country into an Islamic welfare state. In reality, the Ehsaas programme has its origins in the Benazir Income Support Programme (BISP), introduced by the last PPP government to assist the poorest families.

Since 2019, the Ehsaas programme has been updated and widened in scope. Financial handouts and support for women’s “financial inclusion” may only be the beginning. When Covid-19 hit, the PTI programme helped save daily wage earners from chronic hunger, many of whom who had lost their income due to lockdown and disease. Nevertheless, it is too early to say whether the Ehsaas programme will sustainably fight poverty in Pakistan, as much will depend on the anti-corruption drive. Yet the signs are positive. Under the stewardship Dr Sania Nishtar, (the Prime Minister’s special assistant on Poverty Alleviation and Social Safety), millions of undeserving recipients — including bureaucrats as well as those affiliated with the party — have been ‘blacklisted’. Indeed, the country is fortunate to have someone like Dr Sania, who has demonstrated the brilliance and integrity required to run this programme. Both Imran Khan and Pakistan need more Sania-like clones.

Regardless of specific welfare programmes, one thing they all have in common is the need for sound financial footing. A globalised market economy and the inequality inherited from colonialism, upheld by unequal trade under WTO (World Trade Organisation) regulations and reinforced by the wars in Yemen and Syria, for example, that destroy the economies of whole countries, divide the world into nations with high and relatively lower levels of poverty. Yet when comparing UBI and Ehsaas, one must acknowledge that both frameworks are based on entirely different foundations. One is the outcome of a rather affluent western world that could afford to provide UBI to all, so that social security is provided even in times of emergency, like a pandemic. Developing countries with poverty levels of 50 percent and above and which are home to fragile education and healthcare systems need a different approach. In Pakistan, the Ehsaas programme is government-financed, with an overwhelmingly large portion of funds brought in from international markets, including the IMF. These will have to be repaid.

For Ehsaas to be on sound footing, Pakistan’s GDP (gross domestic product) must reach well beyond the 3 percent-mark, to keep in line with population growth rates. The availability and rational use of energy is an important precondition for raising GDP, as is an educated and skilled workforce. Yet achieving this could take decades, especially as it doubtful that the National Curriculum Framework (NCF) is up to the task of improving education standards.

China, another country with a large population and high levels of poverty, shows what is possible. Back in 1990, it had a population of 1.13 billon, out of which some 750 million lived below the international poverty line. — that is, more than two-thirds of the population. By 2012, this had dropped to fewer than 90 million (approximately 8 percent of the population). Fast-forward to 2016 — the most recent year for which World Bank figures are available — and the number of people living in poverty in China was 7.2 million (or 0.5 percent of the population). That is, 745 fewer people lived in extreme poverty than 30 years ago. But here again, sustained GDP growth over an extended period of time has been key. Serious doubts remain as to whether the Chinese experience can be repeated elsewhere. Not least because today’s world faces multiple threats like climate change and global pandemics that are not going anywhere. Under these circumstances it therefore has to be asked if extensive growth, as the GDP-based model represents, is sustainable in a world with limited resources, which in some areas are close to full depletion. Thus, the Chinese model, even if used as a blueprint only, will have to be adjusted to reflect new realities. Maybe CPEC (Chinese-Pakistan Economic Corridor) and BRI (Belt and Road Initiative) represent a first step. But for Pakistan to keep up, we need to stall population growth, while focusing on improving education standards as well as security and good governance.

Ikram Sehgal is a defence and security analyst and can be reached at ikram.sehgal@smswppl.com. Dr Bettina Robotka, former Professor of South Asian Studies, Humboldt University, Berlin and Editor of the Defence Journal and a Consultant to Pathfinder Group