New PM & reforms agenda

Huzaima Bukhari, Dr. Ikramul Haq & Abdul Rauf Shakoori

Pakistan needs all out fundamental structural reforms in all areas of governance. However, the most important and immediate is political stability—the main challenge faced by the 23rd Prime Minister of Pakistan, Mian Muhammad Shehbaz Sharif. Before taking oath, after elected with 174 votes of members of National Assembly, he made a number of pledges, reported amongst others by Associated Press of Pakistan. These measures were more in the nature of fire-fighting than fundamental structural reforms. In this article, an attempt is made to highlight some key areas requiring immediate attention.

The best way to bring about transparency in public finance and uproot financial crimes is establishment of a central anti-crime agency as highlighted in Uprooting corruption: Lessons from China, Global Village Space, May 12, 2021. Political parties must get rid of tax evaders and those living beyond means in their ranks and files. Parties should also get rid of cultism—one man controlling the entire party. Once elected as the Prime Minister he/she should not head the party. So far no political party is adhering to the basic norm of democracy that is separation of party control and running state affairs. The party should make the government accountable.

In utter violation of the Constitution, no party is holding elections as elsewhere in the world where bona fide democracy exists. This is the main area where we need to focus before talking of economic revival. Authoritarianism is apparent in our political culture. No one should be indispensible. Individuals come and go—what matters is welfare of masses, effective functioning of institutions and enforcement of rule of law. Democratisation of political parties, accountability of all and supremacy of the Constitution alone can strengthen democracy—this is also necessary to check external institutional influence and control of party by those having money power. It is time to reform all institutions and ensure economic progress of Pakistan for which a detailed roadmap is given in Friend for all seasons, Narratives, May 8, 2021 explaining what we can learn from our most trusted friend China while celebrating 70 years of cherished relations and the importance of China-Pakistan Economic Corridor (CPEC) and  Belt and Road Initiative (BRI).

The recent article by Shakeel Ahmad Ramay, Fixing the economy and CPEC, The News, April 11, 2022, gives many pragmatic solutions for fixing the economy as well as CPEC and the following paragraph is worth quoting:

“In the conclusion, ruling elite, new government and parties will have to work on four areas, which is pre-requisite to make the CPEC cooperation a success. First, the ruling elite will have to put the house in order and political elite will have to come of out mentality of self-greatness. Second, government will have to devise SEZs policy and cooperate agriculture policy immediately. Third, there should be no political games or point scoring to present itself champion of China-Pakistan brotherhood. As China does not care about parties or individuals, China only cares about State of Pakistan and People of Pakistan. Especially PMLN and PPPP will have to learn this and they must avoid self-projection on this front”.

The salient points for consideration of all political parties and national debate to evolve National Reforms Agenda, beyond party affiliations, before next elections can be:

1. Creating new province—South Punjab Province—for which constitutional amendment bill is already lying in National Assembly, filed on March 24, 2022. 
2. Making Karachi federal territory to ensure that it gets due funds and best administration.
3. Carrying out fundamental reforms in the justice system and in administrative/governance apparatuses to eliminate the causes of litigation. Ensuring efficacy and accountability of all institutions. 
4. Revamping of education system to end ignorance and illiteracy, and make people skilful rather than distributing paper degrees and diplomas. Focal point of education should be creating a society that is tolerant, disciplined, courteous and knowledgeable—capable of making innovations and technological advances.
5. Holding direct elections of Senate and giving it powers to vote on Money Bill.
6. Decentralising political, administrative and financial responsibility to local governments. Education, health, housing, local policing, and all civil amenities should be provided through elected representatives of the local governments that should have powers to raise taxes for these purposes.
7. Digitizing, enforcing transparency and accountability in the governments at all levels to enable citizens to understand and participating fully in the process of national integration.
8. Reforming civil services, ensuring fair deal for employees with effective and across the board accountability.
9. Eliminating terrorism, sectarianism, bigotry, intolerance and violence through enforcement of law and by taking concrete measures to ensure social development of society based on higher values of life and humanity.
10. Implementing strict laws to curb terrorist financing, money laundering, plundering of national wealth, political write off of loans and leakages in revenue collections.
11. Devising long-term and short-term strategies to break the shackles of debt-trap, making Pakistan a self-reliant economy and ensuring social security and economic justice for all citizens.

12. Reforming and strengthening of management of public finances. Transparent public sector spending coupled with efficient performance.
13. Controlling wasteful, non-developmental expenditure.
14. Reforming of technical, institutional and organizational dimensions of public finance.
15. Ensuring good governance and corruption free administrative and judicial structures.
16. Federal government should only collect income tax and customs duty. Harmonised sales tax on goods and services should be in the provincial domain. All federal, provincial and local taxes should be collected through one agency (National Tax Authority) which should also disburse pensions and other social security payments to all citizens.
17. Reducing excessive marginal tax rates making them compatible with other tax jurisdictions of the world, especially in Asia.  Substantially reducing corporate rate of tax. Eliminating onerous taxes and other regulations for corporate sector that are main stumbling blocks for domestic and foreign investments. Simplifying tax laws and procedures.

Dr. Nadeem Ul Haque, Vice Chancellor of PIDE, in How Pakistan Became an Asian Tiger by 2050 has offered an optimistic, futuristic and realistic perspective for a prosperous Pakistan. Unfortunately, this work has yet not been given the attention it deserves by policymakers, legislators, academicians, businessmen and administrators. Our politicians, administrators, intelligentsia and entrepreneurs keep on complaining about multiple and complex challenges faced by Pakistan but seldom strive to implement even the available and workable solutions by local experts. We want IMF, World Bank and others to reform us. This is our real tragedy and dilemma.

We must appreciate and implement the indigenous research-based solutions after debate in public and in national and provincial assemblies and Senate. The Standing and Special Committees should invite (through virtual platforms if needed) experts for assisting and there should be live telecast so that public learns the process of legislation for beneficial reforms.

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Huzaima Bukhari & Dr. Ikramul Haq, lawyers and partners of Huzaima, Ikram & Ijaz, are Adjunct Faculty at Lahore University of Management Sciences (LUMS), members Advisory Board and Visiting Senior Fellows of Pakistan Institute of Development Economics (PIDE). Abdul Rauf Shakoori is a corporate lawyer based in the USA and an expert in ‘White Collar Crimes and Sanctions Compliance’. They have recently coauthored a book, Pakistan Tackling FATF: Challenges and Solutions