Rethinking Governance – A Case of Sindh

Throughout human history, relinquishing power has remained one of the most difficult acts for those who wield it. Be it an empire’s control over its colonies, a majority’s domination of an ethnic minority, or a corporate monopoly’s control over a market, the initial reactions are remarkably similar. The perpetuation of control is justified in the name of historical, civilizational or political claims; supposedly greater contributions to the development of colonies or controlled regions; and, when the argument becomes too blatant, even racial superiority. In corporate lingua, it is dressed up in clichés such as efficient deployment of resources and economies of scale.

Yet experience tells us that bringing decision-making closer to those being governed generally improves supervision, accountability and participation.
The current debate, triggered by the Interior Minister’s remarks about the “collapse of the governance system”, is now headed to Parliament in October. One can only hope that “collective wisdom” will prevail over collective bargaining.

Three ideas dominate the debate: creating new provinces; establishing autonomous administrative units within provinces; and empowering local governments on the model of major metropolitan governments such as London or New York.

Pakistan has experimented with local governments since the 1960s. Ironically, they were generally assigned greater authority and resources under military governments of Gen. Ayub Khan and Gen. Pervez Musharraf. Democratic governments, on the other hand, have repeatedly concentrated powers and finances at the provincial level, weakened local-government laws and delayed local elections.

Perhaps the most striking manifestation of this centralizing instinct came after the 18th Amendment in 2010. It substantially devolved authority from Islamabad to the provinces. But due to its faulty structure, the provinces were able to recentralize the subjects already devolved to local governments. The 7th National Finance Commission (NFC) award of 2010 reinforced it by devolving financial resources from the Federation to provinces and allocating (rather misappropriating) a share of the local governments, which they used to get in lieu of Octroi & Zila Tax merged in GST since 1999.

Pakistan moved from a powerful Federation and empowered local governments to a fiscally constrained federation and weak local governments, while unprecedented authority and resources accumulated at the provincial level. This arrangement suited the political parties controlling Parliament, the provincial governments and the NFC process.

The results deserve scrutiny.

Average economic growth during the Ayub-Yahya period was around 6–7 per cent, during Zia’s rule above 6 per cent, and during the Musharraf years around 5 per cent. By comparison, growth during the Bhutto period was around 4 per cent, during the democratic 1990s around 4–4.5 per cent, and post-2008 roughly 3.5–4 per cent.

Sindh’s literacy rate increased from 21 per cent in 1961 to 30.2 per cent in 1972. More significant is its performance relative to Pakistan. In 1972, Sindh’s literacy rate was 8.5 percentage points above the national average. That lead declined to 5.2 points in 1981 and only 1.4 points in 1998. By the 2017 Census, the relationship had reversed: Sindh stood at 54.6 per cent against Pakistan’s 58.9 per cent—4.3 points below the national average.

A province that once led Pakistan by 8.5 percentage points now trails it by more than four.

During the Musharraf-era devolution, when education and health functions were substantially devolved to district governments, Pakistan’s primary Net Enrolment Rate (ages 5-9) rose from the low-40s around 2001-02 to about 57 per cent by 2008-09. It has now dropped to around 54 per cent.

Sindh’s NER reached around 54 per cent in 2008-09 but has since fallen to about 50 per cent. After 18 years of enormous expenditure, Sindh has lost the enrolment gains achieved during devolution.