Poor performance of social sectors

A report released by Mahbubul Haq Centre maintains that "weak administrative structures, low budget allocations, poor quality and widespread inequities in access" are major impediments in the delivery of key social sectors such as education and health in Pakistan. Few would dispute any element of this statement. However, in all fairness no one government, federal or provincial, can be held responsible for sustained inadequate outlay on education and health as successive governments have invariably invested well below the United Nations suggested 2 percent of Gross Domestic Product on education.
Subsequent to the passage of the 18th Amendment, education and health have become provincial subjects (though Higher Education Council remains within the federal domain), but the rationale for failing to invest adequately in the social sector remains the same: insufficient financial resources.
Critics of this logic legitimately refer to two factors that can override the mantra of financial constraints. First and foremost the provincial governments must revisit their expenditure priorities by keeping in mind the results of a study conducted by the Unesco International Institute for Educational Planning which indicated that stronger capacities in educational planning and management have an important spillover effect on the system as a whole. Or, in other words, with higher levels of education, expenditure on health declines as education makes people more aware of the positive effects of personal hygiene and generates a more skilled workforce which has positive implications on economic growth. And, secondly, given that social sector development is now a provincial subject the provincial governments must seek to increase their revenues further through undertaking proactive measures, including eliminating all exemptions and begin levying a tax on the income of the rich landlords - a provincial subject as per the constitution.
Anomalies exist in the constitution in the sense that income tax is levied and collected by the Federal Board of Revenue though the revenue so generated is shared between the provinces and the centre (with provincial share in the current financial year at fifty-seven and a half percent with the federal share at forty-two and a half percent) and yet income tax on rich farmers is a provincial subject. Analysts argue that income tax must be levied on income at the same rate irrespective of its source and the FBR should collect it as per the National Finance Commission award. It is perhaps the best indication of our politicians' placing their self-interest above that of the people they purport to represent that the 18th Amendment did not take any decision on this matter and only MQM, with essentially an urban support base, proposed taxing income of rich farmers. Rough estimates indicate that if farm income is taxed at the same rate as for other sources of income and the entire amount invested in education Pakistan could well emerge as a nation with a literacy rate close to 90 percent within a decade.
The Mahbubul Haq Centre's report also focused on poor governance as an impediment towards delivery of social sectors. There is evidence to suggest that the performance of different provinces with respect to their delivery varies greatly with the poorer provinces struggling more with inadequate capacity. Thus capacity building must form one major pillar to improve service delivery to the masses. However, governance must not include wilful corruption and abuse of power through appointments at senior, middle and lower level positions on the basis of nepotism rather than on the basis of education and relevant work experience. This trend continues and from the federal down to the provincial to the district level of government there are frequent charges of appointments made on the basis of nepotism that are simply ignored by the current leadership both federal and provincial. It is suggested that governments at all levels link performance to the disbursement of subsequent tranches earmarked in the budget for it is only such linkage that would ensure that scarce resources are utilised optimally.