Weaponising climate: Pakistan's long history of diverting disaster funds

Pakistan's approach to disaster and climate funding follows a decades-old template: collect revenue in the name of emergencies, then integrate it into general federal accounts. This practice, originating from a 10% surcharge after the devastating 1970 Bhola cyclone, has persisted through various governments. The revenue, initially for emergency relief, was later absorbed into general federal accounts without public accounting. Fifty years later, Pakistan still employs this model, now managing a Rs1.55 trillion instrument misclassified as non-tax revenue.

This strategy operates on two fronts. One track collects resources for disaster relief, recently rebranded as climate resilience due to increasing flood frequency. The second involves imposing non-tax revenue through petroleum pricing. The petroleum development levy (PDL), a surcharge dating to 1961, was structurally insulated in 2010 to avoid provincial revenue sharing. It has grown significantly, exceeding Rs200 billion annually by FY2018-19. While not formally a climate instrument, it has gained an environmental association, culminating in the 2026 climate support levy.

The "flooding track" reveals a pattern of federal plans lacking dedicated funding. Since the 1973 floods, Pakistan has implemented multiple national flood protection plans without ring-fencing funds. Similarly, relief funds, like the prime minister's relief fund model activated in 1992, have been deployed repeatedly without legal ring-fencing. This design allows governments to evade parliamentary scrutiny, judicial challenges, and revenue distribution requirements by classifying flood revenue as voluntary donations rather than taxation.

Following the catastrophic 2010 floods, which affected 20 million people and caused $43 billion in damages, the government announced a flood relief surcharge of Rs40 billion. This amount was collected and absorbed into the federal consolidated fund while simultaneously negotiating IMF targets. More recently, after the 2022 floods, the government quietly repurposed its existing super tax. Section 4B, initially for displaced persons' rehabilitation, became Section 4C, a super tax on high earners, further obscuring the allocation of funds intended for humanitarian aid.