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Budget FY22: The middle class, new-poor feel left out

  • Published at 07:04 pm June 6th, 2021

No good news came out for them from the proposed budget, they say

In the proposed budget for the fiscal year 2021-22, the middle class and the new-poor, made by the economic hardships of Covid-19 pandemic, fear that it is not going to benefit them and rather will add salt to their wounds.

Talking to Dhaka Tribune, they said that no good news came out for them from the proposed budget.

Rather, they said that their worst fears came true after prices of essential commodities, which kept spiralling out of control since Ramadan, did not witness any impact and remained out of their reach.

Sanjid Khatun, a housewife from Azimpur, said on Sunday that the middle class remained out of any direct assistance from the government, as seen in the budget.

"We would have been very happy if they considered lowering the cost of essential goods. Since Ramadan, grocery prices skyrocketed, with no respite in sight," she also said.

Also Read - How will the budget affect the middle class?

She also lamented that apart from commodity price hikes, bills for mobile and internet, house rent, gas and others keep increasing but their income did not soar as much.

Aminul Islam, a school teacher from the same area, said that although the media reported the proposed budget as pro-people, there is a lot to be desired. 

"Poor people can beg or receive assistance from someone, but we, the middle-class people, are completely dependent on our salaries for our livelihood."

Md Masum Patwary, a banker, said that the country's rapid economic transformation stood for naught if the annual budgets did not include any support scheme for the middle class.

“The middle class contributes more than any other class to society and the economy. The gradual upswing in prices of daily commodities has further cornered them," said Arpan Pal, a former service holder but unemployed for the last few months.

After the budget, the kitchen markets began to hike prices. Steps need to be taken to control unscrupulous syndicates, he added.

Nazrul Islam, former professor of economics at the University of Dhaka (DU) said that it would not be right to think that the country will move forward leaving aside the middle class population. 

The proposed budget will be passed on June 30.  Various suggestions are coming from economists and concerned people, these should be taken into consideration, he also said.

There is room for further discussion and modification at this time, as there is no effective program in the budget for job creation or employment oriented or those who have become new poor due to the pandemic. It is vital to include incentives and facilities in the revised budget for the middle class and the new poor, he added.

Also Read - Leaving the most vulnerable behind

In a post-virtual budget press conference of the South Asian Network on Economic Modeling (SANEM), Dhaka University Professor of Economics and SANEM Executive Director Selim Raihan said that the budget lacks a clear projection for the new poor and middle class who are badly affected by the pandemic. 

Although economic recovery was mentioned in the budget, the issue of social recovery was not seriously reflected, he also said.

"The recovery of education, health, social security, poverty, inequality, etc. due to the Corona epidemic needed to be mentioned more clearly and seriously in the budget. Especially during the pandemic, poor and ultra-poor people are getting some support through various government and social initiatives. However, middle-class people are suffering the worst.”

Development policy researcher Khan Asaduzzaman noted that creating employment for the large youth and aspirant job seekers is one of the major challenges.  It is high time to put a special allocation in the budget to the middle class also.

He also said that middle-class people have lost their jobs due to Covid-19, many have lost their income, but the cost of living, including medical care, has increased. 

Convener of the Citizens' Platform and Distinguished Fellow at the Centre for Policy Dialogue (CPD) Debapriya Bhattacharya said that the proposed budget does not state anything about what should be done for the newly impoverished people in the pandemic. 

Even the real allocation for poverty alleviation has not been increased, he added.

He further elaborated that the minimum poverty line in the country has risen from 10% to 15%. In some cases that is likely to be more than 35-43%. 

Expenditure of the Ministry of Health, Labor, Mass Education, Department of Women and Children, Department of Bridges, Ministry of Defense have also been included as part of poverty alleviation. The government has to give a clear idea about this. It is important to have transparency on how the expenditure of these sectors will be directly covered by poverty alleviation, the economist added.