A surge in public appeasement

LAHORE: This government announces public appeasing packages even during the pandemic when resources need to carefully used. In the waiver of power bills from March to June for instance it has even included trades that operated unhindered during lockdown.

Government decision to boot the electricity bills of small traders and small industries for four months is commendable, as most of these 3.2 million entities did no business after the coronavirus entered Pakistan.

But then there are many trades that recorded higher sales during the lockdown period, as they were allowed to operate to facilitate the households. These included grocery stores or kirayana stores that sell edibles and other daily use household items like shampoo, toothpastes, detergents, soaps and many more.

Fruit and vegetable shops were also allowed to operate during this period, as were the bakeries, milk sellers.

Since the consumers were in panic they stocked more items than their normal needs and continued normal daily purchases in addition to the stocked items (that they stocked as a precaution in case there was a curfew or shortage of edibles.

All these traders and industries are the beneficiary of this package, as it is not based on trade but on sanctioned power loads for shopkeepers and small industries.

Traders who were not allowed to operate needed this help badly, but for those who conducted business as usual, this waiver on power bills would be an added income. The power bills of trades that remained inoperative most of the time would be nominal except during the first half of the month when all businesses were operating.

Power bills of those shops and industries that fall under the waiver bracket would be much higher than those that were completely closed. This in other words means that the operative shops would get waiver of higher amount than the closed ones.

Relaxation was given to some trades by the same planners who prepared the power relief package. They should have left businesses that continued to run, out of the package.

Some may argue that the shops operated half day from 9-5 instead of general routine of 8-10. But the crowd at these shops during the opening period clearly shows that their net sales were higher than in normal full day trading.

Government lacks data about the types of businesses each small trader is in. But it could have at least bound each beneficiary to submit an affidavit to prove they were not operating during the lockdown.

An easier way would have been to let the power distribution companies determine which trade was active or not. However, given the high level of corruption in power sector this would have become an avenue for rent seeking.

In case of an affidavit, it could have been verified at a later stage, and arrears recovered in case it was false. Out of more than 3.2 million small trade and industries, the number of shops and small industries would be higher than two million.

Even if the number is 2 million, with an average bill of Rs300/month, the government would waste a subsidy amount of Rs2.4 billion on undeserving businesses.

This power subsidy is an opportunity to record the exact detail of each trade and its ownership. The beneficiaries should be given the concession without any hindrance by the power distribution companies, but they should be asked to furnish the details of their business, number of employees and owners name to the Ehsaas setup through SMS, email or WhatsApp along with their consumer number by June 15.

They have 45 days to furnish the details otherwise the Discos should be asked to charge the full power bill. The government is doing some good work to ease the miseries of trade and industry impacted by the pandemic, but in doing so it must devise strategy to remove the past flaws in regulating businesses.

When the pandemic is over, we should be fully prepared to make use of valuable data if collected at the subsidy distribution stage.

The state should be more vigilant in the distribution of aid to the people. Many food rations distributed to poor families found their way into retail outlets.

Probably some families collected more ration than their need and sold the extra at low rates. Then there are families that are starving because they hesitate to come forward when alms are distributed along with photo sessions.

They fear of humiliation, if by chance their photograph is published, while taking the free ration. The beggars should also be taken care of as they have become both a security and health menace during lockdown.