The commission — a provincial version of the National Finance Commission and mandatory under the 18th Amendment — will work out a formula for the allocation of resources across the province.

Questions about the commission were the focus of the post budget press conference held by Finance Minister Mian Mujtaba Shujaur Rehman, Local Government Minister Rana Sanaullah Khan and Finance Secretary Tariq Bajwa on Tuesday.

Rehman restricted himself to reading a written statement. The questions put to the government were answered by Khan and Bajwa.

Asked why the government had not constituted the commission ahead of the budget and how it had determined the amounts to be allocated to various areas of the province, Bajwa said that according to the law, district nazims and tehsil nazims had to be members of the commission. The local governments are yet to be formed, he said, so the Punjab government had distributed the funds among districts “keeping in view the reports of the last PFC”.

He did not know when the last PFC had been constituted.

Khan interrupted him to announce that the Local Government Act might be passed in the next assembly session and local government elections held by October.

Asked for the formula under development funds had been allocated to south Punjab, central Punjab and north Punjab, Khan said Rs93 billion had been allocated for south Punjab “not entirely on the basis of population but also to end the sense of deprivation” in the region.

Reporter wanted to know the exact amount of development funds earmarked for Lahore, Rawalpindi and Faisalabad. Only the Planning and Development Board chairman could answer the question, Khan said.

Asked why the government had not allocated funds for carving out two new provinces (South Punjab and Bahawalpur), Khan said the PML-N would consult its allies and establish a “credible commission” on the creation of new provinces. Funds for new provinces would be allocated after the committee’s recommendations were available.

Khan defended the decision to raise salaries and pensions of government employees by a uniform 10 per cent, instead 10 and 15 per cent like the Khyber Pakhtunkhwa. Civil servants too, had opposed varying raises, he said.

The minister also defended the capital gains tax the government plans to levy. The government, he said, was hoping to collect Rs2 billion from it. Thousands of acres of cultivated land around Lahore has been declared residential but it will be 30 years before they are developed. The tax, said Khan, would “stop speculative buying and selling of property.”

Khan said that taxing the rich showed the ‘wisdom of Chief Minister Shahbaz Sharif’. He recalled that in his last tenure, Sharif had imposed a tax on luxury vehicles “but unfortunately people started registering their vehicles in Islamabad and other provinces”.

Bajwa answered questions regarding the overdraft and utilisation of development funds. About the former, he said that the law allowed the government to borrow up to salaries of six weeks from the State Bank.

Asked why the government had failed to use more of the development funds, he said it was because of the “general elections”.

Published in The Express Tribune, June 19^th, 2013.

The budget has several common themes carried over from previous years’ budgets as the infrastructure-friendly ruling Pakistan Muslim League Nawaz (PML-N) seeks to build roads, highways, power plants, and irrigation canals in the province. The development budget has been set at Rs290 billion, about 74% higher than last year’s spending numbers, though only about 16% higher than the development budget announced last June. Punjab, like Sindh, has a problem with being able to spend all of the money it allocates, largely owing to the inefficiency of the provincial bureaucracy.

In contrast to the federal budget announced by the PML-N, the provincial budget contained far more populist measures:

there was an increase in the provincial minimum wage from Rs9,000 to Rs10,000 and the government announced several new taxes on the more affluent segments of society.

Taxation and austerity

Given the fact that a large proportion of most wealthy Pakistanis’ net worth is tied up in residential real estate, the provincial government has decided to levy a tax on it.

Residential properties of between two and four kanals (1,210 square yards to 2,420 square yards) will have to pay an annual tax of Rs500,000. Properties of between four kanals and an acre (4,840 square yards) will be required to pay Rs1 million in taxes and residential properties larger than one acre will be required to pay Rs1.5 million in taxes.

Analysts suggest that the vast majority of residential real estate in the province will not be affected by the tax, which appears to be the government’s goal anyway. “Our taxation plans target the rich,” said Punjab Chief Minister Shahbaz Sharif.

The finance minister had similar sentiments. “The Punjab government will not levy any tax on the poor. Only those segments will be brought into the tax-net which can pay taxes,” said Shujaur Rehman.

The provincial government also pledged to implement the Punjab Agricultural Income Tax Act of 1997, though they did not specify how this would be done.

Spending priorities

In addition to several populist schemes – including a continuation of the students laptops scheme – the provincial government appears to have largely decided to stick to the formula that worked in their previous term, with only one major exception: the allocation for development projects in the energy sector have been doubled, albeit only to Rs20 billion.

Aside from the massive wheat-buying operation of the provincial government – which is financed through bank borrowing and not taxes – the single biggest expenditure of the Punjab government will be the salaries of local government employees, mostly school teachers and medical professionals working in public health facilities.

The next largest expenditure is on roads and other physical infrastructure, clocking in at Rs97 billion, an increase of over 26% from last year. And in a bid to address the allegation that Lahore monopolises the provincial budget, about Rs10 billion has been earmarked to bring Faisalabad, Multan, Rawalpindi and Gujranwala at par with provincial metropolis.

The provincial government will continue its land record computerisation programme, as a means of trying to secure property rights in a province that is already known to have a relatively stable rule of law. Public safety expenditure in the province is expected to come to about Rs95 billion, up by nearly 12% compared to last year.

The chief minister’s favourite laptop scheme for college students, meanwhile, is expected to cost Rs1 billion. About Rs7.5 billion will be spent trying to run agricultural tube-wells on biogas and solar energy. Another Rs22.5 billion will be spent improving the province’s irrigation system.

Published in The Express Tribune, June 18^th, 2013.

According to party members privy to the developments, Khosa’s request to be included in the Punjab cabinet or to be given the Punjab governorship was “politely turned down” because Nawaz Sharif had given his word to Khosa’s rival Leghari group in DG Khan – when they joined the PML-N – to ‘restrict’ Khosa to the Senate.

Khosa had contested the elections, while occupying a Senate seat, and won a provincial assembly seat from DG Khan, PP-243. According to Article 223 sub clause 4 of the Constitution, if a member of either house of parliament or of a provincial assembly becomes a candidate for a second seat which in accordance with clause (1), he may not hold concurrently with his first seat, then his first seat shall become vacant as soon as he is elected to the second seat. Under the rule Khosa’s Senate seat became vacant as soon as he was elected to the provincial assembly.

Khosa, said the officials, had contested elections from the DG Khan constituency even though the PML-N had decided earlier not to award tickets to any sitting Senators. Senators Zafarullah Khan Dhandla from Bhakkar and Chaudhry Jaffar Iqbal from Rahim Yar Khan also wanted to contest the elections but were not given tickets under the policy.

Party officials, who spoke to The Express Tribune, on condition of anonymity, said that Khosa had approached both Sharif brothers to ask that he be made a senior minister in the Punjab cabinet or the governor but both his requests were turned down. He was asked to contest Senate elections from the seat he had vacated, they said.

Zulfiqar Khosa has yet to take oath and did not cast his vote when the speaker and deputy speaker of the Punjab Assembly were elected. He was conspicuous by his absence when the chief minister was elected.

Khosa was close to the Sharif brothers during their last term in the Punjab, from 2008 to 2013. He was a senior adviser to Shahbaz Sharif, the chief minister, and was in charge of the chief minister’s office located at 90 The Mall.

The relationship became strained in 2012 after Khosa opposed his first cousin Sardar Amjad Khan Khosa’s joining the PML-N, but Chaudhry Nisar Ali Khan and MNA Rana Tanveer were able to convince the Sharifs to overlook Zulfiqar Khosa’s objections. Later, his son Dost Muhammad Khosa spoke against Shahbaz Sharif, which made matters worse. Right before the election his son Saifuddin Khan Khosa joined the Pakistan Peoples Party (PPP). He is also said to have resisted the joining of Leghari group.

Zulfiqar Khosa could not be contacted for his comment.

Published in The Express Tribune, June 16^th, 2013.

LAHORE: Pakistan Muslim League- Nawaz (PML-N) is in talks with the former governor of Punjab Makhdoom Ahmed Mehmood to join the N-League, and if he does so, PPP will lose its two National Assembly seats from Punjab, The Express Tribune has learnt.

PPP had bagged only two NA seats out of total 148 NA seats of Punjab with the blessing of Mehmood. PPP candidate Khawaja Ghulam Rasool Koreja was returned from NA 192 and Makhdom Syed Mustafa Mehmood, son of Ahmed Mehmood, won the NA 195 seat.

According to PML-N sources, Punjab Chief Minister Shahbaz Sharif approached Mehmood a few days ago and discussed Mehmood’s political future. Sources said that Mehmood regretted his decision of joining PPP and blamed his cousin former prime minister Syed Yousaf Raza Gilani for coaxing him to abandon PML-F and join the party.

They said Shahbaz and Mehmood were very old friends. They used to enjoy swimming at Mehmood’s home in Model Town. Mehmood had once helped Shahbaz Sharif in securing victory from Rahim Yar Khan in one of the general elections. Shahbaz in his previous term with the help of Mehmood had launched the idea of Bahawalpur province in order to counter PPP’s South Punjab slogans. But later Mehmood joined PPP and helped the party win two seats from RY Khan.

Mehmood, Sharif talks agenda

Talks between Mehmood and Shahbaz are in a decisive stage, sources said. Mehmood will ask his son and Koreja to resign from their seats and to get re-elected on PML-N ticket in the by-election. He would work with Shahbaz in Punjab while his son Mustafa Mehmood would work in the centre with Prime Minister Nawaz Sharif.

The issue right now is tickets, sources said. The N-League is willing to give ticket to Mehmood’s son, but he also wants ticket for Koreja instead of PML-N’s defeated candidate Makhdom Ahmed Anwar.

PML-N’s officials said that Nawaz would accept Mehmood’s condition in order to uproot PPP from Punjab.

They said PPP in the previous term had claimed that it was the party of federation and PML-N was limited to Punjab.

Zardari wants Mehmood to stay

According to PPP sources, President Asif Ali Zardari when heard Mehmood’s talks with Shahbaz, floated the news that he had accepted the resignation of Punjab governor in order to pressurise him. The president did not want Mehmood to join PML-N.

Though Mehmood had resigned as governor on May 12 the president had not accepted it, sources said.

Contrary to reports party sources claimed that actually President Zardari had signed the summary of resignation of Balochistan governor Zulfiqar Magsi only and Mehmood’s resignation is still in limbo.

They said that the president invited Mehmood through Mian Manzoor Wattoo on Sunday on lunch and tried to convince him to stay with PPP.

According to sources Mehmood told Zardari and Wattoo that he is a Muslim Leaguer by birth and does not have the PPP temperament.

On the other hand, PML-N has delayed appointment of the new governor in Punjab till the end of talks between Shahbaz and Mehmood.

Published in The Express Tribune, June 12^th, 2013.

Sardar Sher Ali Khan Gorchani, the Punjab Assembly deputy speaker, arrived at the 2 Upper Mall house on June 3. He was accompanied by his family members and supporters. He was however told by guards that his predecessor, Rana Mashood, was in possession of the house.

When Mashood refused to vacate the house, Gorchani, forcibly occupied the annexe.

Sources say Mashood has categorically refused to vacate the house. They say the Punjab government too did not reply positively to Gorchani when he informed them about the development.

Sources in the Punjab Assembly and the Civil Secretariat say Gorchani threatened to use his tribesman to evict Mashood. The latter then responded by recruiting men from Bhati Gate and Bund Road to foil the threatened takeover.

They say Mashood, now education minister, says he should be allowed to go on living in the house. Gorchani, on the other hand, has vowed he would not vacate the annexe or move to another residence.

The house has been allotted to deputy speakers since Manzoor Mahal. MPA Sardar Atif Khan Mazari, who is close to Gorchani, says the deputy speaker expects the matter to be resolved soon.

Rana Mashood did not answer his phone when contacted for his side of the story.

Published in The Express Tribune, June 12^th, 2013.

Chief Minister Shahbaz Sharif was also present on the occasion. Of the 21 ministers, five had also served during Sharif’s previous term. Azamul Haq, a technocrat, was appointed as the only advisor to the chief minister.  Chaudhry Muhammad Arshad Jutt, Rai Haider Ali Khan and Rana Maqbool Ahmed were appointed as special assistants to the chief minister.

There are no senior ministers in this cabinet.

None of the MPA’s groups [Dhandla, Leghari and Kanju] that had contested the election as independents and later joined the PML-N were given portfolios. Sharif also did not pick veterans Chaudhry Liaquat (elected MPA six times), Chaudhry Iqbal Gujjar, Chaudhry Manazir Ali and Arshad Lodhi.

Rana Sanaullah has been given charge of local government and community development and additional charge of law and parliamentary affairs. Rana Mashhood has been given the portfolio for school education and the additional charge of higher education and youth affairs, sports, archaeology and tourism. Mian Mujtaba Shujaur Rehman has been given the finance ministry with the additional charge of excise and taxation. Khalil Tahir Sindhu has charge of human rights and minorities affairs and additional charge of health.

The ministers are Rana Sanaullah Khan, Rana Mashhood Khan, Atta Muhammad Manika, Malik Nadeem Kamran, Col (retd) Shuja Khanzada, Tanvir Aslam Malik, Mujtaba Shujaur Rehman, Zakiya Shahnawaz, Hamida Waheeduddin, Abdul Waheed Chaudhary, Bilal Yasin, Iqbal Channar, Dr Farrukh Javed, Raja Ashfaq Sarwar, Yawar Zaman, Asif Malik, Sher Ali Khan, Asif Saeed Khan Manais, Syed Haroon Ahmed Sultan, Chaudhary Muhammad Shafique and Tahir Khalil Sindhu.

Congratulating the cabinet members, Sharif expressed hope that they would rise to the expectations of the people and discharge their duties efficiently.

Talking to media, he said experienced, hardworking and capable persons had been given portfolios. They will work round-the-clock to address public grievances.

When asked whether he would set criteria to judge the ministers’ performance, Sharif said the media would keep a check on them.

Five of the ministers are selected from south Punjab, four from Rawalpindi division, four from Sahiwal division, four from Lahore division and the rest from Faisalabad. Sharif said his cabinet was a balanced team.

Published in The Express Tribune, June 11^th, 2013.

According to sources privy to the matter, the delay took place because the Sharif brothers differed on how many people the cabinet should consist of.

According to law, the Punjab cabinet is entitled to 39 ministries. However, Nawaz Sharif had asked Shahbaz to accommodate only 19 ministers in his cabinet but Shahbaz had refused saying that he should be allowed to appoint 12 to 15 ministers in the first phase and 10 ministers in the second phase.

The brothers have now short listed around 15 ministers so far out of a total of 30 aspirants.

Another reason cited for the delay was the alleged rift between Rana Sanaullah and Rana Mashhood. The chief minister of Punjab had to step in and urge Nawaz to give Sanaullah a major role to play in the provincial cabinet.

Sources revealed that former Punjab law minister Rana Sanaullah is to get the portfolio of senior minister along with the additional charges of law minister and local government minister. The well placed party official added that in the absence of Shahbaz, Rana Sanaullah will head the various meetings and cabinet, and will in effect be in charge of the Punjab assembly as well.

Sanaullah will additionally be assigned with the crucial task of preparing the draft for local government elections and conducting elections across the province, the source said. It will be his job to make sure the party triumphs in those elections.

The party heads contemplated Rana Mashhood’s portfolio and suggested he should continue with his previous part time duty to mobilize the youth and have also decided to assign him the department for the betterment of youth and sports.

Published in The Express Tribune, June 9^th, 2013.

The chief minister discussed the names of potential ministers and their portfolios with his elder brother Nawaz Sharif in a meeting at Jati Umra, in Raiwind, sources in Pakistan Muslim League-Nawaz said. The two leaders concurred that the provincial cabinet would comprise 15 ministers.

The provincial cabinet will take oath in the coming days, sources said, adding that Chief Minister Shahbaz will finalise the names of his cabinet members after receiving input from departments concerned on Saturday.

Sources also shared some of the names Nawaz and Shahbaz discussed at Friday’s meeting. They include former provincial law minister Rana Sanaullah, former deputy speaker in the Punjab Assembly Rana Mashhood, Mian Mujtaba Shujaur Rehman, Zaeem Hussain Qadri, Raja Ashfaq Sarwar, Mehmood Qadir Khan Leghari, Chaudhry Shafique, Arshad Jutt, Iqbal Channar, Begum Zakia Shahnawaz and Ayesha Javed.

According to sources, the chief minister is likely to have a tough time over assigning the law ministry to either Sanaullah or Mashood. While Shahbaz is grateful to Sanuallah for the role he played in the PML-N’s victory in Punjab during his previous tenure as law minister, Nawaz is thankful to Mashood for his role in the creation of the 10-party alliance in Sindh.

Reportedly, the Sharif brothers and some other senior PML-N leaders have decided to satisfy both Sanaullah and Mashood by offering them different portfolios. They agreed that Mashood would be appointed as the law minister while Sanaullah would be appointed as a senior minister and would be given the portfolio for local government as well.

Sanaullah, however, is keen on retaining the law ministry along with the local government portfolio. On the other hand, Mashood insists his legal background makes him more qualified to run the law ministry.

Meanwhile, Ashfaq Sarwar is reportedly lobbying for his appointment as a senior minister. According to PML-N officials, his portfolio is linked with the resolution of the tussle between Sanaullah and Mashood.

Sources say Zakia Shahnawaz is keen on getting a portfolio for social issues like women’s development. Ayesha Javed is also being considered for an important portfolio due to her status as one of the most educated women in PML-N, they added. According to a PML-N official, Zaeem Qadri would most likely receive the education ministry.

Published in The Express Tribune, June 8^th, 2013.

LAHORE: The federal cabinet of Pakistan Muslim League – Nawaz-led (PML-N) government took oath on Friday at the Presidency, Express News reported.

Earlier, PML-N sources told The Express Tribune about the portfolios various PML-N leaders will be getting.

Sources said Chaudhry Nisar Ali Khan will be the Interior Minister, Khawaja Asif Minister of Water and Power, Ishaq Dar Finance Minister, Shahid Khaqan Abbasi Minister for Petroleum, Oil and Gas, Ahsan Iqbal to head Planning and Development and Information Technology, Nawaz Sharif to keep Ministry of Defence.

One young state minister will lead Foreign Affairs, while Tariq Fatemi will work as advisor to the prime minister on foreign affairs.

Sartaj Aziz will also work as advisor to prime minister on economy. The notification for Fatemi and Aziz will be issued in the coming days.

The list further includes:

Federal ministers

Khawaja Saad Rafique

Sikandar Bosan

Abdul Qadir Baloch

Zahid Hamid

Rana Tanveer

Ghulam Murtaza Jatoi

Chaudhry Barjees Tahir

Pervez Rashid

Kamran Michael

Pir Saddurddin Rashdi

Riaz Pirzada

Sardar Yusuf

State ministers

Mian Baleeghur Rehman

Barrister Usman Ibrahim

Pir Aminul Hasnat

Khurram Dastgir Khan

Sheikh Aftab

Jam Kamal

Abdul Hakim Baloch

Anusha Rehman

Saira Afzal Tarar

The plan, which has been in the making since the results of the May 11 polls gave Nawaz the mantle of prime minister, is likely to result in an increase in the power tariff for industries operating round-the-clock, The Express Tribune has learnt.

Faced with the challenging task of delivering on his election promise to resolve the electricity crisis, Nawaz on Thursday presided over a meeting on the energy situation and sought concrete plans for delivering – initially- a short term respite in the debilitating load shedding facing the nation.

The significance of the electricity crisis can be gauged from the newly elected premier’s decision to take over the administrative charge of energy related ministries 15 days ago.

Thursday’s meeting at the State Guest House in Lahore is the first in a series of three high level meetings on the issue, and a plan will only be unveiled after the meetings are complete.

After concrete suggestions for dealing with the spiralling crisis are presented to the newly inducted prime minister, Nawaz is expected to announce his government’s short term measures against the energy crisis, once the plan is finalised in the last meeting scheduled on Friday, June 14. The formal unveiling of this plan will follow shortly afterwards, according to party sources.

A sketch of the plan

According to details, the architects of the new plan are reported to be the managing director of PEPCO and former finance minister Shaukat Tareen. In the initial stage the plan will seek to reduce load shedding to just three to four hours daily within the first six months.

Participants at the meeting have been informed that 1500 MW of electricity has been added to the grid, which improved the unscheduled load shedding. The six month plan is to increase electricity from 12000 MW to 15000 MW by December 2013 which will reduce load shedding duration down to four hours.

Payments to independent power producers (IPPs) and generation companies (GENCOs), last week, in addition to sureties extended to closed units, are also expected to give a welcome sigh of relief to the country.

Under the six months short term strategy, existing units will be operated to their maximum capacities, power generation targets will be established for each month, energy conservation would be encouraged and an audit of Karachi Electrical Supply Corporation (KESC) will be undertaken.

Trouble for KESC?

Nawaz has been informed that KESC is currently receiving 700 MW of electricity from WAPDA, while it has closed its own generation units. KESC has been receiving subsidised electricity to the tune of Rs 80 billion as the same electricity was being purchased by WAPDA from the expensive private sector at higher rates. In addition to the audit, KESC would be asked to produce its own electricity and to route 500 MW back to Punjab, after a few months the remaining 200 MW will also be withdrawn. An inescapable yet difficult decision in the plan is to increase the electricity tariff. Industries operating round-the-clock will now have to pay Rs 18 per unit compared to the existing Rs 15.

However, domestic consumers using less than 100 units will be spared the tariff increase. With the additional revenue, the government expects to purchase 300MW of electricity from the private sector.

Similarly, modern meters will also be installed on all lines emanating from grid stations across the country. These meters are expected to control line losses and electricity theft. In light of their inability to deliver, the government will also announce the replacement of all heads of distribution companies.

Reports suggest that after the initial six month short term plan, the government will start longer term projects addressing the energy shortfall in the country. These projects will include dams, thermal power plants as well as other low cost schemes.

Official statement

According to an official hand out, Nawaz in Thursday’s meeting vowed to put in place effective measures to utilise available resources to rid the country of the energy crisis.

The prime minister said, “I have to put in place initiatives which keep the industrial wheel churning and the fans in every home running.” The energy sector is one of the major priorities of the PML-N government, which would take all stakeholders on board to resolve this grave issue once and for all, he added.

The statement adds that the government plans to retire the crippling circular debt gradually and the premier has directed authorities to determine the viability of all electricity projects, including their financial requirements. Punjab Chief Minister Shahbaz Sharif, Pervez Rashid, Chaudhry Nisar Ali Khan, Ishaq Dar, Khawaja Asif, Shahid Khaqan Abbasi, former caretaker federal minister Dr Musadiq Malik, Shaukat Tareen, Salman Shahbaz, Mian Muhammad Mansha and various energy experts attended the meeting.

Published in The Express Tribune, June 7^th, 2013.

Correction: An earlier version of the story erroneously stated that 1500 MW of electricity will be added to the grid. The error is regretted.