‘Economy in state of collapse’: Dr Kaiser Bengali resigns from govt’s austerity committee

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‘Economy in state of collapse’: Dr Kaiser Bengali resigns from govt’s austerity committee​

Bilal Hussain
September 2, 2024

Renowned economist Dr Kaiser Bengali has resigned from the Austerity Committee (High-Powered Committee for Rightsizing the Federal Government) formed by Prime Minister Shehbaz Sharif to reduce government expenditures.

In his resignation letter, Dr Kaiser cited the lack of government commitment to reduce expenditure, read a press statement.

Dr Kaiser said he was “immensely disappointed that of the 70 government organisations reviewed, the committee recommended privatising 17 commercial entities and retaining 52 government organizations, closing down only one.”

Speaking at a media briefing at the Karachi Press Club (KPC) on Monday, he said the foremost priority of the government has “to be to stem the fiscal hemorrhage that threatens to be fatal for the economy and the country”.

“Yet, the focus of the committee has shifted to retaining almost all the government entities but making them more efficient,” read the statement.

Dr Kasier also challenged the committee’s recommendation to abolish 150,000 Basic Pay Scale (BPS) 1 to 16 low- cost positions and privatise Utility Stores Corporation (USC), saying that the entire burden of “right-sizing” was being imposed on the lower income strata of society and that there was no mention of any of the high-cost Secretary, Additional Secretary, Joint Secretary, Director-General, etc. positions that would be eliminated.

He disclosed that in his detailed report to the committee, he had recommended abolishing 17 divisions and nearly 50 government organisations that would have reduced a substantial number of BPS 20 to 22 positions and effected annual savings of over Rs30 billion in non-salary costs.

The economist was of the view that the country’s economy “was in a state of collapse and has been surviving on a debt ventilator”.

“Now, however, even the International Monetary Fund (IMF) as well as friendly countries were reluctant to extend any further loans and the privatization process has stalled as no one was bidding for State-owned Enterprises.

“Moreover, a number of foreign investors are leaving the country - a process of reverse FDI [Foreign Direct Investment] ,” he said.

Source:
https://www.brecorder.com/news/4032...engali-resigns-from-govts-austerity-committee