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International Development Committee publishes report on Pakistan

4 April 2013

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Future planned increases in UK development assistance to Pakistan should be conditional on action by the Government of Pakistan to increase the proportion of GDP it collects in tax from the wealthy. In future the UK’s aid programme to Pakistan must also focus more closely on supporting the rule of law and anti-corruption efforts.

Launching the report of an inquiry that examined the scale and efficacy of the UK Government aid programme to Pakistan, Sir Malcolm Bruce, Chair of the House of Commons’ International Development Select Committee said today:

“There is a powerful case for maintaining the UK‘s bilateral aid to Pakistan. Britain enjoys a close relationship and  has long established ties with Pakistan which has real poverty and serious security problems.

“Many people in Pakistan who live below the poverty line gain from the projects supported by the UK Department for International Development’s  valuable programmes in education, health and governance. 

“But the Committee is concerned that not enough tax is raised in Pakistan to fully finance improvements in the quality of life for poor people. In particular, we cannot expect people in the UK to pay taxes to improve education and health in Pakistan if the Pakistani elite does not pay meaningful amounts of income tax.”

Accordingly, the Committee of UK parliamentarians calls on the UK Government to set clear terms under which it may increase or reduce future aid funding.

Sir Malcolm adds:

“As a significant friend of Pakistan, the UK must do all it can to encourage Pakistan to implement effective tax collection as part of wider reforms designed to foster inclusive economic and social development for all sections of society.

“Pakistan’s rich must in turn demonstrate a clearer commitment to improving conditions and basic opportunities for all their fellow citizens by paying more in tax than they do under present arrangements.”

In a wide ranging review of the UK (DFID) aid programme to Pakistan, the House of Commons’ International Development Committee  calls on the UK Government to: 

  • work with other donor countries to encourage joint and concerted efforts to require progress on tax policy and revenue collection within Pakistan;
  • use its influence within the International Monetary Fund to ensure this key institution also presses for urgent reform of Pakistan’s tax system;
  • support a nationwide, strategic communication plan within Pakistan to explain the need and benefits of tax policy change and to build domestic political momentum for reform.

Commenting further, Sir Malcolm Bruce said:

“It is vital for Pakistan, and its relations with external aid donors, that the new Government provides clear evidence that it will own and implement an effective anti-corruption strategy.

“DFID must likewise set measurable targets against which to measure and confirm positive impacts arising from effective investment in anti-corruption measures.

“How Pakistan chooses to reform is a matter for Pakistan, but it’s clear there must be substantial reform grounded in lasting institutional change sufficient to transform the country’s services and social indicators.”

In more detailed comments, the cross party group of UK parliamentarians  acknowledges the value delivered by the DFID Maternal and New-born Health Programme but expresses scepticism about recent efforts to ‘scale-up’ at a provincial level (without the total redesign recommended in the analysis set out in the ICAI report of October 2012*).

Commenting on this Sir Malcolm Bruce added:

“Changes are still required to bring lady health workers and community midwives into harmony within this programme and redesign to deliver this must also reflect the devolution of health budgets to provinces.

“More broadly, the Pakistan government must also take much greater ownership of this crucial programme, which is fundamental to any effort to eliminate political, social and economic inequality.”

On DFID’s education programme in the Pakistani Punjab, the Committee acknowledges progress on school attendance and on the recruitment of teachers by merit. It likewise emphasises the need to improve the quality of education provided by schools and notes that DFID’s education programme in Pakistani Punjab is rightly targeting both teacher quality and exams. 

 “DFID’s Punjab Road Map to improve the quality and coverage of education is clearly valuable,” said Sir Malcolm Bruce, “but this programme must ensure the changes it delivers persist over the long term so that it will survive future changes in political administration. In particular, effort must be made to build informed and lasting demand from parents as well as seeking to ensure educational managers and the teaching profession respond to these demands.”

Closer to home, the Committee also calls on UK DFID to explore innovative ways to work more closely with the UK Pakistani diaspora, to improve their participation in monitoring DFID projects  and, where appropriate, to align diaspora funding and remittance flows to Pakistan with DFID supported programmes.

*Independent Commission for Aid Impact: (ICAI)Evaluation of DFID’s Bilateral Aid to Pakistan, October 2012

Further information

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