Prime Minister Shehbaz Sharif may have announced as a triumph of his personal diplomacy the rollover by the UAE of $2 billion in debt, but not only was it agreed in advance but it one of the preconditions for the IMF package to Pakistan. That it came through, however, is positive. It does mean that Pakistan has got some much-needed relief on its foreign debt, which has been particularly burdensome in the turn of the year just past. At the same time, the announcement by federal Finance Minister Muhammad Aurangzeb of the completion of the rightsizing of the federal government by June 30, is in compliance with another IMF benchmark. Mr Aurangzeb said as much while disclosing that the review exercise had been completed for 15 or 16 ministries and divisions, and would be completed for all 42 by June 30. This would mean the abolition of 150,000 posts, which were 60 percent of posts against which recruitments were not being made. Also, non-core positions like gardeners, peons and sweepers would be outsourced, and permanent posts abolished through attrition. Though Mr Aurangzeb did not put a financial value on the changes, he did say that the ministries and divisions involved had a budget of Rs 678 billion this year, and there should be a reduction in this figure in the coming budget.
These are in addition to the recent revision of the pension rules for government servants, designed to lower the burden on the budgets. The IMF seems to have seen too many privileges given to a bloated bureaucracy. Not only has it become more difficult to get into government service, but there is less benefit in doing so. This might strike at health and education, two sectors in which the government employs the most people, and where the private sector has been looming larger. These are areas in which the government is obliged to provide quality services at cost, because if it does not, two very important sectors are left to people motivated by profit, and the purpose of the organization shifts from dispelling ignorance or disease, to turning a buck.
While the government feels constrained to keep acting according to IMF desires, what with the all-important programme review due in a matter of months, it should make sure that it is not being made to sacrifice national sovereignty, or its ability to perform essential functions. It must ensure that the so-called rightsizing does not mean that it cripples itself, and prevents itself from delivering essential functions to the public.
