FINANCE Minister AHM Mustafa Kamal announced the areas and mode of untaxed money investment as he placed the budget in parliament on June 11 for the 2020-2021 fiscal starting from July 1.
But this is not the best of years to place big budgets. In fact with the World Bank stating that growth for this fiscal year and the next would hover around 1-1.5 percent this is the year to focus on what matters — targeted and efficient expenditure. For we have been saying for many years now that a penny saved is a penny earned. Now in this fiscal year the administration had the chance to show that it can manage on a smaller budget.
Because small it has to be — as revenue collection in this year and possibly the next will be abysmal compared to previous years. Setting up huge tax collection targets will be absolutely useless this year. Rather the Finance Ministry should decide to use whatever little it can collect sparingly and efficiently. Small can be beautiful –but that has not happened. A huge 568000 crore budget has been announced — but we know it will be impossible to maintain the revenue targets.
Now is also the time to set national priorities straight. Due to the confusion in priorities by the past Finance Minister the share of GDP given to health in Bangladesh has fallen from 1.1% in 2010 to 0.9% in 2019. So not only will the government have to increase spending on healthcare but also it will have to determine how best to spend a larger government health budget in a way that achieves real impact. Currently 60 percent of all healthcare payments come from the pockets of individuals, pushing 7 percent of households into poverty. But health services expenditure has only gone up by 23 percent — not a meaningful enough number.
One way would be to identify a priority population and finance health care services for them, possibly including those availed in the private sector. This is the “demand-side” approach, which would be a relatively new direction for Bangladesh. It is a more complex system to manage but offers significant promise to strengthen accountability of health care providers.
On the other hand we could do with less defence spending. Bangladesh spent roughly 400 percent more in defense spending between 2008 and 2019.Since we arent fighting any wars and we need instead to save lives we can reduce this expenditure and spend it on health, which is actually wealth. But defence spending has gone up slightly in this budget compared to the last budget.
Spending on big infrastructure projects where a significant portion of the money can be misallocated must also end — but it continues. Only essential spending to provide food or funds for the poor and healthcare must be prioritised and social services spending remains at around 6 percent of the budget — barely a change from its 2019 iteration.
Lacking funds as always must not mean that the corrupt and greedy should have a legal backdoor but yet again the government is allowing black money to be invested with no questions asked on certain sectors. This is like giving a carrot to thieves who have already stolen the horse–it must stop and the government should not have shown weakness in the face of declining fund collection to perpetuate this practice. All in all, the FY 2020-21 budget remains ordinary and not the one the nation should have gotten.
No hope is shown in budget for the common people unless the government fights its own corruption and shows the guts to get back the money looted. Even an ordinary eye doctor due to his connection with the Prime Minister looted a few thousand crore takas and used it to buy property in America. There will be only a few ministers who have not become millionaires. There is hardly any garment factory owner who does not have luxury properties abroad. Still they cannot be kind to their workers at a time of terrible misery. The economy is in ruins — more so for the pandemic. Whatever is the promise in the budget, the government has first to overcome its deficiency in efficiency.
