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The proposed budget for the fiscal year 2021-2022 has forgotten to take new poor, disadvantaged groups and informal sector mostly affected due to Covid pandemic on board, Debapriya Bhattacharya, convenor of Citizen’s Platform for SDGs, Bangladesh, said on Sunday.
‘The road to development has been spacious over the last few years due to the implementation of development plans but the finance minister has forgotten to take the most preferred passengers such as new poor and lagged behind groups of population on the vehicle,’ he said at a media briefing.
The budget was not prepared for new poor, existing poor and informal sector, he commented.
The platform organised the virtual briefing on ‘national budget 2021-2022: what is there for the disadvantaged people.’ Finance minister AHM Mustafa Kamal on Thursday placed the proposed budget before parliament.
The budget has offered more for organised and large business sector and much less for middle class and micro, small and medium enterprises, he said.
It is said that the proposed budget is a business-friendly one, which is true but it is also true that the budget is not friendly to small and informal sectors, he observed.
He said that fiscal incentives were not sufficiently linked to employment generation, particularly for the groups affected most due to the pandemic.
The platform recommended direct cash transfer for poor to increase their disposable income while loan waiver or other liquidity support to the MSME and informal sectors to help them sustain.
‘The second wave has not been considered in preparation of the budgetary numbers and thus, in general, all projections for the FY2022 are on the higher side,’ Debapriya, also a distinguished fellow of the Centre for Policy Dialogue, said.
GDP growth rate and per capita income are increasing during the Covid time and finance minister in his budget speech said that the per capita income would further increase to $2,462 in FY2022.
Relevant budgetary figures show that the FY2021 is a better than FY2020, which is not supported by other evidence, he said.
Questioning the credibility of the projected major macroeconomic figures such as GDP growth, per capita income, poverty rate and employment, he said deficit and discrepancies in data had been increasing every year leading towards data anarchy in the country.
This is because the Bangladesh Bureau of Statistics is losing data leadership role to the finance ministry while the BBS is not preparing data on timely manner, he said.
‘How can the government assess the unemployment scenario and make projection for employment whereas no labour force survey has been conducted since 2016-2017?’ he questioned.
In his speech, Debapriya showed that the finance minister estimated per capita income larger in provisional finance ministry data and better poverty reduction outlook than projected in the Eight-Five year Plan data.
He also questioned the poverty incidence of public expenditure.
For example, the budget documents say that 57.5 per cent of expenditure of defence ministry, 96.7 per cent expenditure for Bridges Division and 99.4 per cent of expenditure of Statistics and Informatics Division will play a role in poverty reduction but there are no explanations on how these expenditures will play role in poverty reduction, he said.
Questioning the lack of data, he said that apparently there was no official estimation yet of the number of households who fell into poverty due to the pandemic. The government also did not consider the research organisations’ research findings on the issue.
CPD distinguished fellow Mustafizur Rahman said that the philosophy of the budget is to reduce the inequality of income, consumption and wealth between the poor and the rich.
But measures for bringing down inequality are not visible in the proposed budget, he said, adding that the government should have widened the allocation for social safety net programmes and provided direct cash transfer to poor.
Cash transfer with expansion of allocation and coverage can create additional demand for products produced by SMEs and thus will create new employment, he said.
Bangladesh Health Watch convener, also a core group member of the platform, Mushtaque Raza Chowdhury, Campaign for Popular Education executive director Rasheda K Choudhury, Manusher Jonno Foundation executive director Shaheen Anam, Chittagong Stock Exchange chairman Asif Ibrahim, the platform’s coordinator Anisatul Fatema Yousuf, among others, spoke at the briefing chaired by former adviser to a caretaker government Sultana Kamal.
