Keynesian prescriptions upended the laissez-faire model of Adam Smith through a benign governmental intervention for public weal. Scholars like Paul Samuelson later came up with “Theory of Public Good” wherein a public good was defined as something that all people could benefit from and enjoy without rivalry and exclusion. National security, air, rivers, and human security are those public goods whose non rivalrous and non- excludable nature makes those equally applicable to all without class, race, or any other distinction. Public welfare is also a public good that is germane to all classes and more so for those who were excluded from those goods due to economic exploitation or any other peculiar nature of their social status.
Provision of public goods therefore demands an economic theory lying in between the market entrepreneurship and welfare economics. The capitalist societies based on laissez-faire economics like the USA have social safety nets and insurance mechanisms to minister to the needs of deprived communities. The welfare states like UK, Nordic countries, and Canada rely on taxation for redistributive justice while the communist societies have based their whole political ideology on economic egalitarianism. That leaves the developing countries already on the dole of international economic institutions scurrying desultorily for economic solutions for endemic poverty and economic inequality. While the states fail in such countries to provide a viable model for public welfare for general populace, the responsibility devolves on niche players to cater to the welfare needs of their constituency. The militaries the world over have found solutions to the healthcare, education, and post retirement needs of their veterans it is only in Pakistan that a unique model has been successfully tested and applied.
The British Indian Army that along with British Navy laid the foundation of a global empire introduced the concept of providing public goods through an institutionalized system of welfare other than normal pensions for the war veterans of subcontinent in 1945 known as Post War Services Reconstruction Fund. At the time of partition (1947) when Pakistan came into being, the balance fund of 18.2 million rupees was transferred to Pakistan as per the proportion of its post WW-II veterans. Till 1953, the fund remained in the custody of the civilian Government while in 1954 it was transferred to the Army. Interestingly in India where the fund was distributed to the veterans no basis of a sustainable welfare organization was laid. Present Department of Ex Servicemen Welfare (DEWS) in India relies on periodic doles from Ministry of Defence and does not have an independent sustainable source of welfare spending for war veterans. In Pakistan however the story was different.
The Army instead of disbursing the balance fund of about Rs 18.2 million (USD 0.2 million) among the beneficiaries, established a foundation called “Fauji Foundation”, under a charitable trust, and invested the money in establishing a Textile Mill. Later from the income of the textile mill, it established first 50 bedded TB hospital at Rawalpindi.
Fauji foundation is proud that from Rs 18.2 million in 1953, it today runs more than 18 industries, the income from which is utilized to serve about 9 million beneficiaries (five percent of country’s population). Generally, more than 80 percent of the income goes towards the welfare activities every year. The welfare is conducted through health care, education and vocational/technical training. To a limited extent welfare is also a by- product of employment generated for the beneficiaries through commercial and welfare activities. Presently, the welfare is conducted through 115 medical facilities, 104 Schools & Colleges, 66 Vocational Training Centres and 10 Technical Training Centres. 58 percent of the welfare budget is spent on healthcare. The 50 bedded hospital has blossomed into a state of the art 750 bedded hospital with the Fauji Foundation Health Care System today being the largest medical chain outside the Government sector, spread all over Pakistan.
