Financial Updates

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Sunday, November 14, 2010

PDF shares strategic direction with development partners

ISLAMABAD: A two-day Pakistan Development Forum (PDF) got under way on Sunday with working sessions chaired by Dr. Abdul Hafeez Shaikh, Minister for Finance, Revenue, Economic Affairs, Statistics and Planning and Development.

“The Forum provides a platform for the Government of Pakistan to lay out its economic and social strategies, development priorities and reform agenda, said Dr. Hafeez Shaikh. ‘’The non-pledging Forum also enables Pakistan’s development partners to better understand the country’s development policy direction and helps in donor coordination and aid effectiveness.”

Highlighting the increasingly prominent role of the provinces under the 7th NFC Award and the 18th Amendment to the constitution, the first day of the PDF featured high-level presentations by all four provincial governments plus AJK and Gilgit-Baltitstan. In their presentations, the Governments reaffirmed their commitment to achieving the Millennium Development Goals.

The presentations and the ensuing discussion also focused on the importance of provincial governments making room in their budgets for improving delivery of basic services including education and skill enhancement; improving health through preventive care and provision of safe drinking water, provision of better infrastructure for greater access from farm to market as well as better employment opportunities for their respective populations. The provinces committed to increasing their own revenue mobilization through implementation of RGST and reforming property tax collection.

The PDF participants, however, noted that the recent floods have significantly affected the provincial development agenda and have placed new demands on their resources for reconstruction and rehabilitation efforts in the affected areas. Nevertheless, this should not come at the expense of funding for basic social services.

The devastating floods that hit Pakistan in July and August this year resulted in unimaginable human tragedy and unprecedented losses to the economy. In the second session: The 2010 Floods, Damage & Needs Assessment (DNA) and Reconstruction, PDF participants learnt about the Government’s rescue and relief operations carried out by the National Disaster Management Authority (NDMA) and relevant provincial agencies with the assistance of Pakistan armed forces and various UN agencies. The Government launched Watan cards to distribute Rs20,000 as relief cash grant to flood affected people. In rolling out the Watan card, the government’s aim is to initiate a transparent, efficient and quick disbursing mechanism to reach out to the flood affectees. The total amount distributed through the Watan card stands at Rs 29.44 billion. Out of which Rs. 16.03 billion has already been withdrawn by the flood-affected people.

At the request of the Government of Pakistan, ADB and WB took the lead in preparation of the Damage and Needs Assessment (DNA). In their presentation to the PDF, the ADB and WB indicated total damages at about $10 billion.

The Government also presented its institutional framework for reconstruction at the federal and provincial level. The Government is keen to strengthen its existing institutions to deliver effectively on its reconstruction strategy. Details were shared about the institutional structure, fast track project approval and the monitoring and evaluation system. The Government has indicated that it would be responsible for public infrastructure reconstruction, and requested donors to support its Citizens Damage Compensation Program. Several donors are considering to support the Government on CDC and are in dialogue with Government to ensure improved targeting, monitoring and grievance redressal procedures.

In the third and last session of PDF Day-1: Protecting the Poor, the Forum participants were informed that total transfers through Zakat, Pakistan Bait-ul-Mal, Employees Old-Age Benefit Institutions, and the Benazir Income Support Program (BISP) showed an increase of 156 percent during the first half of this year as compared with the same period in the previous year. The major part of these funds was disbursed through the BISP to the poor and the vulnerable. The Government remains committed to poverty eradication while continuing to develop a safety net for the vulnerable.

The BISP uses a transparent method for identifying eligible recipients. It has introduced a Poverty Scorecard (a nationwide survey for identifying the poor), together with a database, data validation, and verification. The survey is conducted on a house-to-house basis with 100 percent coverage, although participation is voluntary. The data are then verified from the NADRA database.

“Pakistan is passing through a revolutionary period after the 18th amendment with administrative powers and financial resources being transferred to provinces, but this transition needs to be managed carefully”, said Dr. Hafeez Shaikh. “Watan Card and Benazir Income Support Programme (BISP) have earned laurels internationally and the DNA has provided us with a world class assessment to give impetus to recovery and reconstruction program.”

The second and final day of the PDF on Monday will include a plenary session and sessions on State of the Economy-Challenges and Response; Growth and Sectoral Reform; Aid Effectiveness; and the closing session. Donors will also have an opportunity to indicate their views on Government approaches and ways in which they will provide support. A private sector session will provide an opportunity to identify ways of strengthening private sector support.­­­­­­­­­­­­­­­­­

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