Development 2.0--by Nadeem Ul Haque

Economists don't pay attention to process of economic policymaking and implementation. However, policy is only as good as the process that backs it up.  Budget is in the air and there will be a lot of talk of it. But when you listen to this podcast, you will find out how serious the budget is and how seriously it will be taken by those who make it.  Commentators will pick the budget to the bone looking for policy. Is there any policy in the budget? Was it prepared with policy mind?  What is the relationship between the Planning Commission, Department and the ministry of finance? Is there teamwork in government or is MOF creeped up to be "first among equals"?  Wajid Rana ex-Finance Secretary MOF talks candidly but very constructively about our budget process. His extensive experience in this area is something we should  all profit by and learn about the budget process. 

Is the budget a law? Then why is it violated so easily? When the budget is passed by parliament it is a law that lays out the expenditure limits and where expenditure is to be made. It also passes a revenue and financing plan. Over the years we have seen how easy it is to violate the this law.  Expenditures are always turn out to be larger than envisaged in the law. Most of the sectoral expenditures made turn out turn out to be contrary to the law. In particular, realized development expenditures are often less than in the law. Revenues are always less than in the law but what is worse, some of the decrease happens because the FM and the ECC hand out tax exemptions as politics or other considerations demand. Article 77 says Parliament has the power to tax and the tax law enunciates taxes that should prevail by law.  Yet MOF is able to violate the constitution and the law with ease. Unfortunately, Parliament is too unconcerned or unaware of its responsibility. The E...