Feeding the poor during COVID-19: Rude awakening!

Whether PM Imran Khan’s indecisiveness to lockdown the country amid provincial governments going ahead and doing it anyway was his political suicide or not, only time will tell; but he was right about one thing: a lockdown is not cheap. Unfortunately, as we have learnt, just lockdown is also not enough. Pakistan’s current COVID-19 strategy is not working, and for a variety of reasons.

For starters, there is no indication that the number of cases have declined, not even in Sindh where the lockdown has been most strict. As we have argued earlier, Pakistan needs to do a lot more testing to determine the extent of the outbreak and stop it from further spreading. This requires resources and strong local government collaboration to test, isolate, track contacts (read more: “Pakistan lockdown: Sophie’s choice” March 26, 2020).

But while we are locking down and testing, and as the more comfortable households (from the graph above, it seems barely 8% of the labor force can self-isolate) are able to stock up rations, physically distance themselves and work remotely from home, a major portion of the Pakistani population is vulnerable and living hand to mouth. They are already being hit hard. They cannot isolate because they need to put food on the table for 7 more people (the average household size for 40 percent of the population from the bottom is 7.6 members)! There are countless videos on social media/TV of shopkeepers, milk and dairy suppliers and daily wagers desperate for government intervention because the lockdown is killing their livelihoods.

This vulnerable population typically depends on daily labor or other forms of informal employment. According to the Labor Force Survey (LFS) 2017-18 of the Pakistan Bureau of Statistics (PBS), 72 percent of all employed persons in Pakistan are employed in the informal sector (urban: 68%, rural: 76%) in non-agricultural occupations. The shut-down affects all these informal sectors. Of these, 42 percent are own-account workers (including daily wagers). Among total employment numbers, over 56 percent of employed persons in Pakistan are own account workers or contributing family workers—these are the most vulnerable participants of the labor force.

Estimations done by Dr. Nasir Iqbal of Pakistan Institute of Development Economics (PIDE) suggest that a full lockdown could lead to an expected layoff of 18.65 million people (selective lockdown: 3 million, partial lockdown: 15.54 million). He further estimates that poverty rate will increase to 33.7 percent (current: 24.3%) in a low-impact scenario of COVID-19 hitting the country, to 44.2 percent in a medium impact scenario and upto 55.9 percent in a high impact scenario. This means: from the current 54 million people who are poor, we could see another 70 million being pushed into poverty taking the total number to 125 million people (in the case of high impact economic recession). It is clear that we need to feed a lot more mouths as economic decline deepens while simultaneously locking down, testing, quarantining and delivering adequate healthcare to those who are infected. If we don’t provide immediate relief to these people, they cannot be expected to stay indoors which in turn would lessen our chances to flatten the curve.

BR Research earlier estimations suggested that considering the poorest 40 percent of the population is completely hit by the lockdown, the government would need to provide ~Rs11,000 (or food alone) to about 11 million families which comes to an amount of Rs113 billion per month. The government’s current allocation per month is Rs38 billion (Rs150 billion for four months) where Rs3,000 will be provided to 12.5 million households. This is an extension of the current BISP/Ehsaas Program (read more: “COIVD-19 lockdown: Can we feed the poor?”, March 25, 2020). This is also in-line with Iqbal’s estimations. But this is assuming that these poor households will still be covering a portion of their consumption through their own-incomes.

Assuming Sania Nishtar and team are able to scale up BISP and fast (within this month!) using technological interventions (which are really commendable), this may still not be enough. And this is where the self-proclaimed “most philanthropic” Pakistani society needs to jump in, and in a substantially organized manner. Civil society organizations, NGOs together with local government need to do a substantially better job of collecting funds and disbursing them to needy families. Handing out food rations as a crowd of people hoard the ration truck is not the way to do, and definitely not in the times when we are supposed to stand at a 6 feet distance from each other. All hands need to be on deck, and even then, we are in for a pretty bad year.