Minister of Planning, Development and Reforms Ahsan Iqbal recently unfolded a blueprint of the proposed reform agenda of the planning commission.

The reforms are aimed at capacity building of the commission through hiring of specialists in the top hierarchy, comprising members and a chief economist. This machinery is to be used for formulating a document, the Vision 2025.

According to the planning minister, the document will comprehensively cover six themes. It appears that the reform agenda is simply directed at formulation of another document, like the 10-Year Perspective Development Plan (2001-11), the Three-Year Development Programme (2001-04) of September2001, the Medium Term Development Framework (2005-10) of May 2005, and the Vision 2030 of August 2007.

These documents served no useful purpose, as the policy framework and the priorities set in these documents remained far removed from those implemented by the government. This dichotomy was partly attributable to our continued subservience to the conditionalities (policy matrix) given to us by lending countries and multilateral agencies, and partly to our apathy to the goal of national development

As regards the first reason, it may be pointed out that we are presently negotiating with the International Monetary Fund another loan to the tune of $6.2 billion. The conditionalities to be proffered by the IMF are not known. However, if the conditionalities happen to be as sweeping as in the past, there will be very little room for our planning commission to come up with an independent formulation of the Vision 2025. In case they do formulate the document shorn of these conditionalities, the outcome will be no different than what was experienced in the past.

As for the second reason — indifference to long-term national development — it may not be true now. This government is committed to the institutional building of the Commission as an apex body for planning economic and social development. However, it is beset with several significant issues. These should be resolved before undertaking the exercise in view of the experience of the reforms of April 2006. These reforms also envisaged strengthening of organisational structure for policy formulation and coordination, and enhancing its capacity for long-term development planning.

Despite the prime minister replacing the finance minister as the planning commission’s chairman, and the hiring of specialists as its members and their placement in grade MP-1, all the Commission achieved was to formulate a valuable document titled ‘Vision 2030’. The document neither formed the basis of policymaking by the government nor was adhered for sectoral and sub-sectoral development during the past several years.

A key issue is that following the supreme reign of market capitalism for nearly past three decades — it is ruefully recognised that the state has a role to play in economic and social development of the country. This recognition has emerged in recent years across the developing and developed world, including the USA — the champion of the Washington Consensus.

In these countries, a reversal in the policy of ‘liberalisation’ is on the anvil, assigning some functions, if not all, to the government in the realm of economic and social development, rather than keeping all sectors open to the private sector, with the state providing only an ‘enabling environment’ to it to grow.

Similarly, ‘deregulation’ is being substituted with an effective and transparent regulatory framework; ‘privatisation’ with corporate social productivity; ‘openness’ with selective controls, and ‘minimum of government’ with an efficient government as one of the important actors, along with private sector and civil society organisations, for national development.

Another important issue concerns the legal and constitutional framework. Prior to the 18th Amendment in April 2010, the subject of ‘national planning and national economic coordination, including planning and coordination of scientific and technological research,’ under serial number 32, was listed in the federal legislative list-1. In other words, the federal government had an exclusive functional responsibility for it.

After the amendment, it has been included in serial number seven in the federal legislative list part-11 of the fourth schedule. This means that it is no longer in the exclusive domain of the federal government, but falls within the purview of the Council of Common Interest (CCI). It pre-supposes approval of the CCI for any proposal for restructuring of the planning commission and formulation of a national development plan.

It is not clear if the Commission has taken approval of the CCI or not. If not, there is a possibility that the provinces may not own the national development plan. This issue needs to be ironed out in the CCI.

The third significant issue relates to the approach to be adopted for planning. There are two broad types of approaches. The first envisages a ‘top-down’ approach, while the second a ‘bottom-up’ one. The choice depends upon the constitutional structure of the state. If the structure is unitary, both approaches are workable. However, if the structure is federal with defined functional responsibilities, the choice is limited to the ‘bottom-up’ approach.

Under the 18th Amendment, functional responsibilities of the three tiers of the government — federal, provincial and local — are well-articulated and defined. Each government is at liberty to establish its own planning machinery and prepare plans for the subjects assigned to it. The planning machinery in Malaysia is the classic example where the ‘bottom-up’ approach is applied to develop national development plan.

In case the planning commission persists with the ‘top-down’ approach, as was practiced before the 18th Amendment, it should seek the agreement of the provinces, if not of the local governments (which have not yet been formed), to this effect, before formulation of the Vision 2025.

Another point that is very relevant is that the capacity of any institution is not built by hiring specialists on contract for a specified period. Neither do the specialists have a long-term interest in capacity building of the institution that they serve, nor do those working under them owe a ready allegiance to them.

Long-term capacity building has to come from within. As such, the planning commission and the government must resuscitate the dormant ‘Economist and Planners group’. The group churned out economists and planners in the past, who acquired world fame and were the bulwark of the reputation of the planning commission itself.

The writer is former joint chief economist of the Planning Commission of Pakistan. masood_kizilbash@hotmail.com