Pointless extravagance
Pakistan's total debt has reportedly risen to Rs36 trillion. There are multiple reasons for the rise, including unnecessary and wasteful expenditures, under the non-development and development heads, incurred by rulers to suit their whims and fancies.
A prime example of waste in the non-development category relates to the needless creation of additional districts and revenue divisions by the provinces. The common people do not benefit from increasing high-level offices because at the end of the day their issues relate to the basic unit of administration which is the sub-division, tehsil or thana.
The same is true of service delivery in schools, health centers, public works and water supply sectors. This is where the state meets the people and this tier needs beefing up. Every rung above this - be it the district, division/region or province - essentially has supervisory responsibilities. The commissioners, the DCs, the DIGs and other divisional/district heads mostly refer cases to their subordinate sub-division officials for disposal. The recurrent revenue expenditure on the office, staff and facilities of an additional DPO for example is sufficient to cater to the unprovided needs of the police stations in a typical district.
The main beneficiaries of multiplication of districts and divisions are actually the local politicians who feel politically elated with an eye on the next election. The officialdom is also delighted because their placement opportunities increase.
There are no efficiency gains merely by reducing the size of a district in an age of rapid transportation, cloud data and electronic communication. It must be understood that in government resolving problems and disposing cases is not a function of increased numbers alone. More judges do not accelerate delivery of justice just as more policemen do not ensure greater security. There are other dynamics that expedite case disposal and provide relief to the public; these include proper selection and training of officials, effective functioning and extra departmental accountability.
Today in every province there are between 5 and 10 superfluous districts and up to three revenue/police divisions each that could be easily scrapped. The cost of posts and positions in an average new district including pays, allowances, accommodations, vehicles, pension contributions amounts to around Rs2-3 billion annually. The opportunity cost of this diversion is enough to provide full school enrolment, medicine, piped water and sewerage disposal in the undivided district. A structural reorganization is still possible to save at least half this expense.
The wasteful expenditures in the development sector are even more glaring. High-capital cost projects like the urban metros, BRTs, intra-city trains and some motorways should have cost half or less of what was spent if only these were designed innovatively. Was investing in such metros (and IPPs) sufficient value for money? Was it fair to cater to a tiny clientele in a population of 220 million with 22 million out-of-school children? The costs and subsequent operating subsidies of metro and BRTs could have been slashed by constructing on-ground roads with underpasses at crossroads. All that was needed was acquisition of land on either side, to accommodate the additional two lanes. Sadly, traffic congestion has actually increased after the building of both the Rawalpindi and Peshawar BRTs.
Pakistan boasts many projects in the water and road sectors where diligent planning, coupled with sound project engineering and responsible execution, continue to provide enormous benefits half a century later. The Warsak Dam was originally built for about $100 million (Rs33 crores in 1961) but has yielded power and irrigation benefits worth $6 billion so far, at current costs, according to an estimate. The Tarbela Dam provides electricity priced at half a billion rupees daily; and this incidentally is only a byproduct. The Ghazi Barotha and Mangla power projects reimburse their costs every three years to the state. This was the period when the advice of the Planning Commission was heeded.
Similarly, the Karakoram Highway and the right bank national highway to Karachi revolutionized freight and passenger traffic immeasurably. Contrast these highways with the 367 kms M-2, Islamabad-Lahore motorway, which cost over Rs60 billion (one billion dollars then) but with annual revenues of only a billion rupees today. The option of aligning it closer to industrialized cities and the non-option of adding fifty kilometers by including a village near Rawalpindi was never placed before independent experts for appraisal.
Something similar almost happened a few years back in Sindh. The government of the day wanted the Nai Gaj small dam built to irrigate 28000 acres and generate 4 megawatt power. The initial cost estimate soared to Rs59 billion. Wapda officials, at the peril of their jobs, explained that this was economically not feasible and should be shelved. About that time funding was unavailable for the vital Kurram Tangi dam (also costing
Rs59 billion) in Waziristan to irrigate 200,000 acres and generate 84megawatt hydropower. Fortunately, the Planning Commission supported Wapda and the cost was reduced to Rs26 billion - seriously annoying some people.
A practical solution needs to be evolved to preempt approving non-feasible gargantuan projects like the ones quoted above. Monuments for personal fame should not turn into tombstones of eternal pain!
Two decisions are required. First, every project needs to be technically and financially evaluated by an independent expert group before the PDWP, CDWP and ECNEC take decisions. Selecting the expert group would be problematic, to avoid bias, but the Pakistan Institute of Development Economics and credible private-sector universities in each province can assist with impartial advice.
Second, to avoid mischief in awarding contracts, appraisal and award of open competitive bids should not be left to the discretion of the officials of the line departments and corporations alone.