Way out: Reforms of the FEG
Following earlier research done at the Pakistan Institute of Development Economics (PIDE), Planning Commission Framework for Economic Growth (FEG) highlighted urban reform as central to any strategy for sustainable reform in Pakistan Cities become engines of growth and development when they are allowed to function as decentralized, coherent administrative units for the advancement of commerce. To achieve this:
1. Policy, research and thinking needs to move away from a spaceless approach to development by integrating the role of cities as engines of growth.
2. Fiscal federalism needs to be urgently adopted for city growth and to allow cities adequate ownership of their land and resources. This must mean an adequate definition of city limits with exclusive city ownership of its resources. Federal, provincial governments, and the defense agencies should not affect city administration.
3. The zoning paradigm needs to move away from its current emphasis on upper class housing to one that recognizes the diversity of the functions of a city. It must favor density, high rise mixed use and walkability especially in downtown areas. In addition it must favor public and community space while allowing for commerce, culture and education and other needed city activities. Zoning needs to be based on clear transparent processes based on open citizen consultations.
4. Building regulations must be loosened to allow complex high rise construction.
5. City centers need to be developed for dense mixed use. Government ownership of city-centre land needs to be reduced if it is retarding downtown development. Commerce is to be given priority in city centers.
6. City management should be professional, consultative and accountable. Cities must be able to hire out of their budgets without federal hiring restrictions such as the Unified/National Pay Scales and mandatory positions for the federal civil service. Moreover, decision-making must be based on open consultative processes.
Central to this reform process will be a much needed civil service reform without which cities cannot attain the autonomy, the professionalism and the control over their land to be able to develop. Unless the system of perks and civil service control of cities and their land development is shaken, serious commercial and construction activity will not start. And without this there will be no serious effort to start unravelling the current system of exclusion of the poor. In turn enlightened space and culture to counter the prevailing fundamentalist narrative will not emerge.
FEG and its predecessors at the PIDE have initiated the thinking on a simple reform agenda which will reduce the current high level of rent-seeking in Pakistan’s cities and lay the basis of commerce and creativity which will fuel sustainable growth. Is anyone listening?