Human Security in Pakistan Box 14.2: Level of Pro-Poor Spending Major Pro-Poor Expenditures by the Federal and Provincial Governments (Rs in Billion) 2020-21 2021-22 2022-23 (B.E) • Cash Transfers(BISP) 246 362 400 • Social Security and Welfare (Provincial Governments 56 62 70 • Differential Subsidy on Electricity to 242 194 355 Small Domestic Consumers • Others*(PASSCO, USC, PBM) 32 40 37 TOTAL 576 658 862 (% of GDP) 1.2 1.2 1.0 Implementation of the Financing Plan will have major positive consequences, as follows: i. It will enable a big increase in the level of poor spending by 150%. This will be tantamount to additional support of Rs 1275 billion 1 for the support of the poor at a time when it is most needed. ii. Development spending has sharply contracted with respect to the GDP. It will become possible to raise it back to the level of almost 3% of the GDP, close to the level four years ago. iii. One of the major findings of factors limiting the HSI in Pakistan, as identified in Chapter 12, is the low total public expenditure on education and health. It will become possible to raise it from 2.2% of the GDP to 3% of the GDP. iv. Finally, the increased fiscal space will be used to bring down the budget deficit from over 6.5% of the GDP to 4.5% of the GDP. Very importantly, this will reduce the inflationary pressures and exert a restraining influence on the size of the external current account deficit and therefore help in sustaining foreign exchange reserves. It will lead to the generation of a primary surplus in the consolidated budget of over 1% of the GDP. The subsequent chapter will specify in detail how the above potential developments can be used to maximize the positive impact on the HSI for the people of Pakistan. 1 At current GDP. 118