Surely, the government understands well enough that it does itself no favours by announcing timely relief measures, giving hope to employers and employees alike in these uncertain times, and then not following up on one promise after another. And some relief measures are more time-sensitive than others. For example, manufacturers have had to urge the Federal Board of Revenue (FBR) yet again to release their verified tax refunds before Eid, at least, so they can have enough liquidity on hand to meet immediate expenses; the most urgent being pending salaries/wages of their staff ahead of the festive holiday. It was, after all, the ruling party itself that urged businesses not to lay off any workers because of the slowdown caused by the pandemic because the government, it was claimed, stood ready to provide the necessary cushion - enough concessional liquidity - to survive this profound crisis hopefully without any job losses. Yet since the announcements this administration has also started showing symptoms of the age-old problem of governments; they are big when it comes to making promises and not so big when it comes to honouring them.
It was on April 16 this year that the ministry of finance was heaping lavish praise on its own relief measures for trade and industry. Through a press statement, it also announced that tax refunds of Rs50 billion 'stuck since 2014' would be released 'within a week'. To implement this landmark decision the FBR reportedly issued a letter titled, 'Income Tax Refunds Under Prime Minister Relief Package Covid-19', to chief commissioners across the country, asking for lists for verified refund claims along with IBAN numbers of claimants so necessary amounts could be transferred by FBR directly to their accounts. Seems like a simple, and efficient, enough process. Yet, according to further reports, the first lists were sent to the Bureau, as asked, around end-April, early-May, yet no refund amount has been released even though the time period promised was one week. Some experts have claimed that the government and FBR, along with the latter's field formations, are just not on the same page when it comes to the official relief package, and things have been delayed because they have been busy sabotaging the process by finding ways of denying refunds to a majority of taxpayers.
There's still some chatter about the Board doing one thing or the other to ensure quick payments, but this thing might already have dragged on too long from businesses' point of view. This is of course not the only relief/stimulus package meant to retain employees while the economy is in lockdown that has not been properly followed through. Assurances from the monetary sector have also left a little something to be desired. The State Bank of Pakistan (SBP) is autonomous and independent for all intents and purposes, but it moves in lockstep with the government especially when throwing money into the market to keep it stable. And its measures to lessen the impact of the downturn seemed to do the trick, especially concessional loans to businesses as long as they retain workers, but only for a while and then they seemed to run into problems of their own. In this particular case banks simply would not accept the downside risk in case of default and the whole thing is pretty much hanging in the air till their risk management matrices are fine tuned. And while all these initiatives made the government look rather nice when they were announced, they've left employers with big overhead costs and nothing to finance them with; while the government is still trying to put its policies in order.
The media houses too are beset with a similar problem and had been waiting for the Rs1.8 billion owed to them before Eid, yet even after taking up the issue 'with all the federal ministries/departments/organisations' and expediting the process, the Press Information Department (PID) has been able to announce disbursement of only Rs63 million so far. What should these media houses now tell all their workers and journalists who have been working around shrinking salaries ever since the new administration took over Islamabad in 2018? The government must realise that these are not matters that can be allowed to linger unaddressed for long periods of time. The economy has taken a heavy hit from the lockdown, which is no surprise, and businesses will simply collapse if the promised help does not come very soon. Then it would not matter much even if the money stuck in unnecessary processes and hurdles is released.