ISLAMABAD: The government’s efforts to provide relief to the people suffered a setback when the International Monetary Fund (IMF) rejected a proposal to increase the number of Benazir Income Support Program (BISP) beneficiaries.
Officials had proposed expanding the scope of the social welfare program to cover the 20 to 30 percent of the population living in poverty to provide quarterly stipends, JEE News reported on Saturday. .
While the IMF had endorsed and approved an increase in the BISP allocation by Rs 40 billion, it was increased from Rs 360 billion to Rs 400 billion for the current financial year for 8.9 million beneficiaries. , but could not propose to increase the coverage to the desired level. To be implemented keeping in mind the scarcity of required budgetary resources.
“The IMF refused to accede to the government’s demand to jack up the Proxy Man Test (PMT) to extend coverage to provide monthly stipends to the nearly 30 percent of the population living below the poverty line. is, saying that the government does not have the required budgetary resources”, sources told JEE News.
When contacted, a senior finance ministry official said there was no dispute on this account, as on the BISP front, there was a clear agreement under which the government would provide a quarterly stipend of Rs 7,000 to 8.9 million beneficiaries. has been
Sources said government negotiators had mooted the idea before the IMF review mission to increase the PMT limit to maximize coverage. He said that CPI-based inflation will see an increase after implementation of IMF-recommended tightening prescriptions through tax and utility price hikes.
Fund staff initially did not oppose it but called for increased tax revenue and an end to untargeted subsidies.
Top IMF officials argued that the government has a rich database under BISP’s National Socio-Economic Registry (NSER), and provides targeted subsidies on electricity, gas, etc. need to be done and used to deliver POL. Motorcycles and small vehicles.
Currently, this proposal could not be implemented. But, considering the possibility of a new IMF program after the expiry of the existing program under the Extended Fund Facility in June 2023, Pakistan and the IMF are targeting inflation-affected people to protect them from rising prices. A subsidy mechanism must be in place. Hiking
Various proposals for introducing a targeted subsidy mechanism were discussed but ultimately abandoned for various reasons.
Now, the weekly Sensitive Price Index (SPI) has touched 45.64% on a weekly basis and the Consumer Price Index (CPI) has crossed 31.5% on a monthly basis in February 2023. Both CPI and SPI are bound to rise further in the coming weeks and months. current fiscal year.
There is no alternative but a targeted subsidy mechanism to save the weaker sections from falling below the poverty line in the short and medium term.
