The UK Parliament’s International Development Committee has delivered a stinging blow to the Department for International Development over its aid policy to Pakistan. A report published this week by the committee recognises the importance of the UK’s bilateral aid to Pakistan, but notes that in the past British aid money has “not been spent effectively” in Pakistan.
It says that such aid spending cannot continue unless there is “clear evidence that the newly elected Pakistan Government is also willing to make the necessary changes so as to contribute more to improving the livelihood of its people”.
At present only 0.57 per cent of Pakistanis – around 768,000 people – pay income tax. The rich pay nothing, nor do more than 70 per cent of elected politicians. No-one has been prosecuted for income tax evasion during the last 25 years.
The committee says that DFID should only increase official development assistance to the planned £464 million per annum “if there is evidence that the newly elected Pakistan administration will increase tax revenues in general and income tax, in particular, and if it subsequently succeeds in increasing the amount of tax taken.”
It adds: “If the Pakistan Government is unwilling to take action to increase its revenues and improve services for its people, it cannot expect the British people to do so in the long run. We cannot expect the citizens of the UK to pay taxes to improve education and health in Pakistan if the Pakistan elite is not paying income tax.”
The committee also recommends that Britain and other donors encourage the Pakistan government to strengthen the powers and independence of the country’s National Accountability Bureau in an effort to reduce corruption in the country.