The awarding of perks and privileges by national and provincial assemblies to themselves given the state of the economy is being justifiably subjected to considerable criticism. Shortly after the budget 2012-13 was announced on 6th June 2013 the salaries, perks and privileges of the Speaker of the National Assembly as well as the Senate Chairman were approved and any prime minister who stayed in office for three years or more was made eligible for lifetime perks and privileges.
The Sindh assembly during the later weeks of its tenure approved an increase in salaries of all members by 60 percent as well as life time privileges to all those elected to the assembly effective July 2011 - a bill that was opposed by the PML (Functional) as well as the MQM's Khwaja Izharul Hassan; however PPP's Syed Bachal Shah accused MQM of double standards as the party's representatives had approved the increase in perks and privileges during the relevant standing committee meetings. Reports indicate that the Interior Ministry has issued a notification declaring unlimited perks and privileges for former Interior Minister Rehman Malik, which is likely to be formally published in the next issue of Government Gazette. It is reported to state "that all federal ministers for interior, excluding caretaker federal ministers and those who held office when the Constitution stood suspended, can benefit indefinitely from facilities such as protocol coverage by Federal Investigation Agency to the ministers, their spouses and children at all airports of the country; services of a personal staff officer/assistant private secretary/personal assistant; a driver and an orderly." Propriety demands that since this notification is not backed by the approval of parliament and the cabinet, it should therefore not be implemented.
The National Assembly Deputy Speaker, Faisal Karim Kundi requested in May of last year that the pays of National Assembly members be raised for, in his view: "building the capacity of MNAs, an increase in monthly salary and allowances will be helpful." However, this matter has not been approved yet. There is little doubt that our parliamentarians by and large belong to the richest 5 to 10 percent income category in this country; in addition credible reports indicate that a very small percentage pay income tax, with farm income remaining exempt from payment of income tax, and also exert influence to not only get massive loans from state-operated banks but also have them entirely or partially written off. Former Prime Minister Gilani's wife for example had more than half of the loan she procured from the Zarai Taraqiati Bank Limited (ZTBL) written off during her husband's tenure as the Prime Minister. In short, there is little to indicate that there is any need to raise incomes of our parliamentarians for capacity building.
None of the abovementioned perks are budget neutral and are a component of current expenditure of the government with no associated development activity that would either raise the national output or employment opportunities. The cost would be borne by taxpayers and even though the exact cost of these lifetime privileges and hefty pay rise may be little in comparison to the total budget outlay yet it would definitely contribute to a rise in the budget deficit with its consequent impact on the rate of inflation.
While the current parliament, provincial or national, is not the trail blazer in granting these privileges to specific office holders as well as its general members, (Ghulam Ishaq Khan had approved additional perks and a raise in the pension of the office of the President before he stepped down after being forced to resign), yet it is quite inexplicable that the incumbent government had little compunction about adding this burden on to their constituents just before the elections in spite of the current state of the economy. At present the deficit is expected to escalate to 8.5 percent and with power and tax reforms stalled it is unlikely that the government would be able to release funds to parliamentarians without more money printing having a considerable bearing on the inflation rate, price stability and quality of life of the general public. One can only hope that the next parliament reverses all these unjustified measures forthwith.
Tuesday, March 19, 2013
Pakistan: Awarding perks to themselves
The awarding of perks and privileges by national and provincial assemblies to themselves given the state of the economy is being justifiably subjected to considerable criticism. Shortly after the budget 2012-13 was announced on 6th June 2013 the salaries, perks and privileges of the Speaker of the National Assembly as well as the Senate Chairman were approved and any prime minister who stayed in office for three years or more was made eligible for lifetime perks and privileges.
The Sindh assembly during the later weeks of its tenure approved an increase in salaries of all members by 60 percent as well as life time privileges to all those elected to the assembly effective July 2011 - a bill that was opposed by the PML (Functional) as well as the MQM's Khwaja Izharul Hassan; however PPP's Syed Bachal Shah accused MQM of double standards as the party's representatives had approved the increase in perks and privileges during the relevant standing committee meetings. Reports indicate that the Interior Ministry has issued a notification declaring unlimited perks and privileges for former Interior Minister Rehman Malik, which is likely to be formally published in the next issue of Government Gazette. It is reported to state "that all federal ministers for interior, excluding caretaker federal ministers and those who held office when the Constitution stood suspended, can benefit indefinitely from facilities such as protocol coverage by Federal Investigation Agency to the ministers, their spouses and children at all airports of the country; services of a personal staff officer/assistant private secretary/personal assistant; a driver and an orderly." Propriety demands that since this notification is not backed by the approval of parliament and the cabinet, it should therefore not be implemented.
The National Assembly Deputy Speaker, Faisal Karim Kundi requested in May of last year that the pays of National Assembly members be raised for, in his view: "building the capacity of MNAs, an increase in monthly salary and allowances will be helpful." However, this matter has not been approved yet. There is little doubt that our parliamentarians by and large belong to the richest 5 to 10 percent income category in this country; in addition credible reports indicate that a very small percentage pay income tax, with farm income remaining exempt from payment of income tax, and also exert influence to not only get massive loans from state-operated banks but also have them entirely or partially written off. Former Prime Minister Gilani's wife for example had more than half of the loan she procured from the Zarai Taraqiati Bank Limited (ZTBL) written off during her husband's tenure as the Prime Minister. In short, there is little to indicate that there is any need to raise incomes of our parliamentarians for capacity building.
None of the abovementioned perks are budget neutral and are a component of current expenditure of the government with no associated development activity that would either raise the national output or employment opportunities. The cost would be borne by taxpayers and even though the exact cost of these lifetime privileges and hefty pay rise may be little in comparison to the total budget outlay yet it would definitely contribute to a rise in the budget deficit with its consequent impact on the rate of inflation.
While the current parliament, provincial or national, is not the trail blazer in granting these privileges to specific office holders as well as its general members, (Ghulam Ishaq Khan had approved additional perks and a raise in the pension of the office of the President before he stepped down after being forced to resign), yet it is quite inexplicable that the incumbent government had little compunction about adding this burden on to their constituents just before the elections in spite of the current state of the economy. At present the deficit is expected to escalate to 8.5 percent and with power and tax reforms stalled it is unlikely that the government would be able to release funds to parliamentarians without more money printing having a considerable bearing on the inflation rate, price stability and quality of life of the general public. One can only hope that the next parliament reverses all these unjustified measures forthwith.
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