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Benazir income support plan growing into biggest social safety net

Published on 29th June, Edition 26, 2015

 

Presently, the Government of Pakistan has proclaimed an ambitious yearly plan for alleviating poverty and producing more career opportunities, involving levels that may have a far touching impact on the lives of citizens.

REGIONAL& GLOBAL POVERTY

DESCRIPTION

NUMBER OF POOR (MILLIONS)

POVERTY RATE (% POPULATION)

2005

2010

2015

2005

2010

2015

East Asia

304.5

140.4

53.4

16.8

7.4

2.7

Europe and Central Asia

16.0

8.4

4.3

3.4

1.8

0.9

Latin America and Caribbean

45.0

35.0

27.3

8.4

6.2

4.5

Middle East and North Africa

9.4

6.7

5.4

3.8

2.5

1.9

South Asia

583.4

317.9

145.2

40.2

20.3

8.7

Sub-Saharan Africa

379.5

369.9

349.9

54.5

46.9

39.3

World

1,337.8

878.2

585.5

25.7

15.8

9.9

In the present federal budget, the government has grown the amount for Benazir Income Support Programme (BISP) from Rs97 billion FY2014-15 to Rs102 billion for FY2015-16. The number of BISP beneficiaries increased to 5 million during FY2014-15. However, BISP has issued the installment of Rs23 billion to its partner banks for the previous quarter of the present financial year. BISP is the biggest social safety net in South Asia under which 4.9 million beneficiary families are given Rs1500 per month and Rs4500/quarter. Female beneficiaries may withdraw cash from any POS and ATM machines. BISP offers money to its beneficiaries by partner banks such as HBL, Tameer Bank, Sindh Bank, Bank Alfalah, UBL and Summit Bank.

Historically, BISP was introduced during July 2008 with an instant mission of consumption smoothening and cushioning the pessimistic attempts of slow economic development, the food shortages and inflation on the poor, chiefly women, by the provision of cash transfers of Rs1,000 per month to eligible families, now the monthly installment has been improved. Its strategic plans comprise supporting the achievement of MDGs to eradicate great and chronic poverty, to empower of women and to attain worldwide basic education.

Since its inception, BISP has boosted quickly; and experts say that it is now the greatest single social safety net program in the country’s history. The number of beneficiaries has grown from 1.7 million households in FY2008-9 to almost 4.7 million as of 31st December, 2014 and BISP yearly disbursements have increased from Rs16 billion in FY2009 to Rs65 billion in FY2014.

This fiscal year, disbursements to beneficiaries is predicted to touch Rs90 billion. This period of development and consolidation in BISP is characterized by 2 key transitions. In initial level BISP (FY2009 to 2011), beneficiaries were recognized through parliamentarians while in 2011 a key transition occurred and poor households have been recognized by a poverty scorecard review based on household demographics, assets, and other measurable properties.

The nationwide poverty scorecard survey, the first of its sort in South Asia, enables BISP to recognize eligible households by the application of a PMT (proxy means test) that decides welfare status of the household on a scale between 0-100. The survey was opened during October 2010 and has been completed in the entire Pakistan except in 2-agencies of FATA.

 

Debit card

In order to more enhance the efficiency of the payment delivery mechanisms and to offer multiple payment choices to its beneficiaries, BISP inked contacts with numerous commercial banks in FY2012, with a goal to start Benazir debit cards in over 124 districts of Pakistan by December 31, 2012.

It was planned to distribute the debit cards to over 4 million beneficiaries by December 31, 2012. Beneficiaries will be able to gather their cash advantages from ATM machines or bank-designated franchises. Total 4.02 million beneficiaries have been paid by Benazir debit card during July-September 2014 installment.

Smart card

BISP introduced Benazir smart card on test basis in 4 test districts i.e. Mirpur Khas, Multan, Sanghar and Mianwali in collaboration with its partners NADRA and UBL. In this system, beneficiaries were offered smart cards, along with a virtual bank account with UBL, by which beneficiaries withdraw their financial assistance from any of UBL omni franchise transparently and at their convenience in the country.

Cash grant background

In the country, this project was started for poverty alleviation and women empowerment among the socially and economically marginalized sections.

CIVILIAN LABOUR FORCE, EMPLOYED AND UNEMPLOYED IN PAKISTAN (MILLION)

YEAR

2012-13

2013-14

Labour Force

60.34

60.09

Employed

56.58

56.52

Unemployed

3.76

3.58

Unemployment rate (%)

6.24

6.0

Because of the global financial, food and fuel shortages, Pakistan recorded escalating inflation over the previous few eras.

In addition, the country’s economic issues were exacerbated because of the worldwide war on terror and consecutive natural disasters during 2010 and 2011. Furthermore, the number of citizens living below the poverty line is important and more susceptible households are at the risk of declining below the poverty line.

Women are particularly unfavorably affected through chronic poverty as 6 out of 10 of the global’s poorest citizens are women who must, as the main family caretakers and producers of food, shoulder the burden of tilling land, grinding grain, carrying water and cooking.

Conclusion

Through BISP, the Government of Pakistan is trying to provide relief to the poorest of the poor segment of the society by the programmes so that the maximum number of families may become financially independent.

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