WITH temporary staff serving in all the key top economic posts of the country, the forthcoming budget is likely to suffer from a credibility gap. Every department of the government has a role to play in preparing the budget, whether by drawing up resource requirements for the forthcoming year, or determining what resource envelope will be available. There is a built-in incentive for the government to push overoptimistic targets into the budget at this stage, and it is the job of people such as the finance secretary and FBR chairman to take corrective action. Likewise with estimates of foreign economic assistance where the input of the State Bank, and to a lesser degree the Economic Affairs Division (when it is not behaving like a post office), is needed to keep one’s feet on the ground.

But officers on temporary postings have a difficult time performing this vital duty, since they are less likely to try and correct the finance minister than those who are more secure in their posts. The problem is aggravated by the fact that the government appears more and more embattled as it approaches the finish line of its term, and the incentive to grant all wishes to all constituents is magnified. So a beleaguered government, in the last year of its rule, is working with temporary officers in all key departments to draw up a budget at a crucial time, when pressures on the external and fiscal accounts are growing. On top of that, the position of the finance secretary, central to the budget-making exercise, is particularly tenuous, since he is scheduled to retire from government service only weeks after the budget is set to be announced. If he is keen on a post-retirement posting it could prove to be an incentive to do nothing that might displease the government. This is an especially difficult time to be drawing up a budget, with the political winds blowing with growing ferocity, and the country moving into a highly demanding and challenging phase in the implementation of CPEC, which itself is afflicted with overoptimistic assumptions. It is precisely during their last year in office that governments past have allowed the economic situation to drift towards crisis rather than provide the firm guiding hand that is needed.

Published in Dawn, May 3rd, 2017