Countries reopen
AFTER some success in lowering the daily deaths and new cases of coronavirus, several countries are slowly relaxing lockdowns in an attempt to revive economic activity. In Europe, the hardest-hit countries which include the UK, Italy, Spain and France, are rolling out plans for some sectors such as construction and primary schools to open up after nearly seven weeks of closure. In the US, the president has left it to the governor of each state to ease restrictions, which has led to the easing of lockdowns in Georgia, Oklahoma and Alaska. Many of these countries have told citizens to wear face coverings in public and practise distancing at shopping centres, with some — especially in Europe — still limiting public gatherings such as weddings.
While there is no doubt that the coronavirus and forced shutdowns have unleashed economic hardship, the reality of the viruses’ deadly nature persists. Although the emotional and financial toll of this uncertain new era already seems unbearable, the truth is that the world is still in the early stages of the pandemic and must be vigilant. In doing so, it must adapt to rapidly changing scenarios — such as a possible second wave as has been reported in China. As countries open up and the possibility of transmission grows, mistakes made in the first wave will become essential learnings. For example, the UK was too late to lock down and therefore saw its healthcare system become overwhelmed as Covid-19 cases spiked. The situation has forced British authorities to look for local manufacturers for PPE and ramp up daily tests. The increased testing, dedicated isolation centres and mechanisms for contact-tracing developed during lockdowns should help countries that are now opening up. Here, Vietnam serves as an excellent example of the learnings it employed from the Sars outbreak nearly two decades ago. As it recognised its healthcare limitations, it was one of the quickest to alert its citizens and take action. This timeliness, aggressive infection control and targeted awareness campaign for its population are strong factors behind its zero reported deaths. In a country that borders China and with a population of over 90m, this is an undeniable success — and proof that ‘overreaction’ and caution can save lives and also justify the reopening of commercial activity. While many countries have learned these lessons the hard way, after ghastly death tolls and the crippling of healthcare systems, they must remain vigilant and react quickly when the second wave comes.
Mental health helpline
LAST week, Chief Minister Murad Ali Shah announced the launch of a mental health helpline in the province, in light of the psychological toll being wrought on citizens by the Covid-19 pandemic. This facility has been established by the Sindh Mental Health Authority, which was constituted in September 2017, five years after the passage of the Sindh Mental Health Act. If this timeline is indicative of the low-priority status given to mental health by policymakers, it is hoped that the helpline might signal a reorientation. On a macro level, the pandemic has not only revealed how intrinsic public health is to the security and stability of nations, but also exposed how little has been invested in it. The socioeconomic impact of poor health, including poor mental health, can be devastating for individuals, families, communities and countries alike, particularly in times of crisis. A study by AKUH in 2016 estimated the direct and indirect financial costs of mental illnesses in Pakistan at the time at over Rs250bn annually.
Today, as the pandemic upends every aspect of life as we know it and plunges millions into precarious circumstances, addressing people’s mental health needs is as important as ensuring they have food in their bellies, a roof over their heads and other basic rights. In turn, promoting psychological well-being and resilience cannot be done in isolation from the environmental, social and economic factors that may trigger or exacerbate a mental health crisis. Though limited in scale and scope, the Sindh mental health helpline should constitute one in a series of interventions geared towards developing an integrated and holistic suite of social protection services to support vulnerable and at-risk individuals. A woman suffering from domestic violence, for example, may need access to shelter, legal aid, income support, etc as much as she needs psychological counselling. When a lifeline is extended, we must commit to seeing it through — to ensure that, for every call for help, there is a response.
Nepra report
THE State of the Industry Report for 2019 released by Nepra, the power regulator, has brought the focus back on the real problems dragging down the power sector. The recently leaked government-mandated report on IPPs had shifted the direction of the debate on issues plaguing the power sector to the validity of power purchase agreements executed with private producers, as well as ‘excess’ payments made to them at the expense of hapless consumers and the accumulation of a massive circular debt. Indeed, it can be argued that the agreements executed with private thermal power producers since 1994 could have been less generous to the investors, and more favourable to government and consumers had those been negotiated properly. Nevertheless, it is misleading to blame IPPs for the chaos in the power sector. The capacity payments and other costs of IPPs may have contributed to making electricity more expensive for consumers and to a huge circular debt, but governance and other issues raised by the regulator are the real cause of distress in the power sector.
The regulator has called for meaningful governance reforms in the power sector to make it efficient and reduce generation, transmission and distribution costs. It has also advised the government to deregulate and decentralise decision-making powers for improvements in the performance of public-sector distribution firms and follow it up with their privatisation. The report has rightly raised questions over the use of inefficient state-run power plants instead of employing efficient generation capacity and pointed out that the centralised governance model for distribution companies had failed to bring about noticeable improvements in performance over a period of more than 15 years. The companies continue to face distribution losses because of theft, corruption and lack of investment in a crumbling power transmission and distribution network. The previous government had added more than 12,000MW to the system to end rolling outages but failed to invest anything in the distribution network. Then, the distribution firms are unable to fully recover their bills, resulting in a significant rise in the unrecovered amount to Rs1.1tr, or more than half the current circular debt.
These and other inefficiencies of state-run power companies, together with the impact of poor governance, have added to the cost of electricity generation and distribution, which is eventually passed on to consumers through Nepra. The inefficiencies and losses that cannot be recovered through tariff increases are added to the circular debt. The power sector is in dire need of policy, governance and pricing reforms. This effort should focus on eliminating inefficiencies and losses in the power sector rather than a witch-hunt against private producers. But that should not stop IPPs from playing their part and making adjustments in their agreements to help the government reduce electricity prices for consumers who are in trouble because of the economic slowdown and loss of jobs in these times.