A woman holds up her BISP card in this undated photo

Islamabad, the heart of Pakistan's political and administrative machinery, finds itself grappling with pressing fiscal constraints that demand prudent decisions. While there are various avenues to address these challenges, recent choices have raised concerns. It appears that the government's approach leans toward tapping into resources earmarked for public welfare and those devolved to the provinces. In this article, we will delve into the ongoing debate surrounding the Benazir Income Support Program (BISP) and the 7th National Finance Commission (NFC), dissecting the narratives and examining the consequences of potential changes.

BISP: Income Support, Not Anti-Poverty:

One of the recurring criticisms directed at BISP is its perceived ineffectiveness in alleviating poverty. However, it is crucial to understand that BISP was never conceived as an "anti-poverty" program. Its primary objective is to provide income support to economically vulnerable segments of society, bridging the gap between their meager incomes and basic necessities. The term "income support" encapsulates its mission.

Critics have argued that cash transfers breed dependency and beggary, advocating instead for investments in income-generating and skill development programs. Yet, history reveals that numerous such programs, spanning half a century, often consumed substantial resources in administrative costs with minimal tangible outcomes. Contrarily, ample empirical evidence from developed nations demonstrates that cash transfers stimulate consumer spending, thereby catalyzing investment and job creation.

Parliamentarian-Based Targeting: A Misconception:

BISP faced opposition regarding its parliamentarian-based targeting approach. Detractors alleged that the program aimed to allow ruling party parliamentarians to distribute patronage among their supporters. However, a closer look reveals a different reality. All parliamentarians, regardless of party affiliation, received an equal number of forms and were informed of an automated Nadra-based selection process. Approximately 2.2 million forms, out of over 4.5 million submitted, were accepted electronically, rejecting more than 50%. Nadra's computers, not parliamentarians, determined the beneficiaries. No study has provided compelling evidence to suggest that BISP's targeting approach resulted in wrongful selections or political patronage.

BISP: A Lifeline for Nine Million Families:

BISP is a women-centered program that provides support to nine million families. The assistance offered equips a recipient family with a 15-day supply of essential commodities at prevailing prices, strengthening their purchasing power by 15-20%. The significance of this support cannot be overstated. Any move to dismantle the program would adversely affect the most vulnerable and disadvantaged members of society.

The NFC: Misunderstood Resource Distribution:

Critics of the 7th NFC assert that by allocating nearly 60% of revenues to the provinces, the central government is left financially vulnerable. This view, however, lacks empirical support.

The 7th NFC and the 18th Amendment, both enacted concurrently, led to the devolution of most items from the Concurrent List to the provinces. This transfer aimed to reduce federal resource demands and enhance provincial capacity for delivering basic services such as education, healthcare, and law enforcement. The assumption was that this shift would result in significant fiscal savings by abolishing unnecessary federal divisions. However, this expectation remains unfulfilled.

The fiscal challenges currently faced by Islamabad are complex and require a balanced approach. Attacking essential social safety nets like BISP and undermining the principles of the NFC would be counterproductive. Rather than scapegoating these programs and devolution measures, it is essential to acknowledge the broader structural issues within the federal government. A sustainable fiscal strategy should prioritize the welfare of Pakistan's most vulnerable citizens while fostering unity and cooperation among the provinces.

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