PESHAWAR: The Pakistan Tehreek-e-Insaf (PTI)-led Khyber-Pakhtunkhwa (K-P) government on Tuesday unveiled its annual budget for fiscal year 2016-17 with a total outlay of Rs505 billion, including Rs161 billion for development.
K-P Finance Minister Muzafar Said presented the budget before the K-P Assembly amid intense heckling from the opposition benches, which shouted slogans of ‘Chor Chor’ when Muzafar delivered the budget speech. The budget is 3.4% higher than the Rs487 billion budget of the outgoing year.
Interestingly, the government has increased its current expenditure by 10% to Rs344 billion while reducing the Annual Development Programme (ADP) by 8% to Rs161 billion.
The finance minister said the government has not introduced any new tax in the budget but has increased the values of certain taxes to increase tax receipts.
This includes increase in tax on vehicles special registration numbers sold to vehicle owners at their own choice. “We have proposed increasing stamp duty on certain items along with increase in levy on electricity. The government has decreased the 2% tax on transfer of property to 1%,” he said.
The K-P government has again prioritised the social sector, making huge allocations of Rs111.5 billion for education, Rs38.4 billion for health, Rs32.9 billion for police, Rs3.4 billion for irrigation, Rs3.7 billion for agriculture, Rs1.9 billion for technical education and vocational training, Rs1.6 billion for social welfare and women development and Rs1.9 billion for forestry and environment.
It has set aside Rs2.90 billion for subsidy on wheat and Rs3.2 billion for communications and works. It has earmarked Rs8.7 billion for mark-up on loans and Rs11 billion for foreign and local loans payback and house building and motorcycle advance of government officials. Rs40.9 billion are kept for pensions.
The transgender community celebrate inclusion of social projects which will be carried out during fiscal year 2016-17, with about Rs200 million allocated for their welfare.
This year the government said transgender census will be conducted for the first time in the country’s history, following which authorities will carry out necessary activities including arrangements of housing scheme, special wards in hospitals, along with other health and education facilities imparting basic skills. A rehabilitation centre will also be set up for the community.
The K-P has announced 10% increase in government employees’ salaries and pension. It has merged the total adhoc allowance of 2014 and only 10% of the adhoc allowance of 2013 in the running basic pay, while freezing the remaining 5% of the adhoc allowance of 2013 at its June 30, 2016 position.
Like the federal government the pension of retired government employees above the age of 85 years has been raised by 25%. The minimum wage for workers has been fixed at Rs14,000 per month. The government has announced Rs1,000 conveyance allowance for special people.
“We will create 36,232 employment opportunities mainly in health and education sector. The lady health workers programme is regularised which includes 13,200 job slots,” the minister said.
Like the previous year’s budget, Said also termed this year’s budget a ‘balanced’ one. However, the K-P government has been facing criticism for the inflated figures and wishful estimates of its previous budget.
The government not only failed to achieve its provincial tax receipts targets but also faced notable decrease in tax receipts share from the federal government. Resultantly, it had to cut its Rs174 billion ADP of 2015-16.
Almost 90% of the K-P budget is dependent on revenue transfers from the federal tax assignment, 1 % of the divisible pool for war on terror and straight transfers.
Muzaffar said the K-P is expecting Rs293.6 billion (under federal tax assignment) while under the 1% war on terror head it is expecting Rs35.2 billion. Both figures are 17% more than the outgoing year.
In straight transfers, the government is expecting to get Rs17.1 billion of royalty on oil and gas production in the southern districts. But, according to Said, the production has decreased by 11% of the outgoing year.
The government is expecting Rs18.7 billion in the Net Hydel Profit (NHP) and Rs15 billion in arrears of the NHP as committed by the federal government via a memorandum of understanding signed between the K-P and the Centre in February.
The government has estimated to get Rs49.5 billion from its own provincial revenue receipts which include Rs10 billion from GST on services and Rs3.6 billion from own hydel generation in the province.
By putting these figures in its revenue estimates, the K-P is apparently repeating the mistakes of its outgoing year. In 2015-2016, it failed to utilise an expected Rs8 billion from timber selling and Rs14billion from housing as it outsourced housing units which were not even constructed.
The Rs161 billion ADP comprises 32% of the total budget and it includes Rs36 billion of foreign project assistance and Rs125 billion of the local APD. According to Said, the Rs125 billion includes a loan of Rs12 billion which the government will borrow to meet the ADP.
“The provincial development programme comprises 1,516 development projects of which 1,237 are running and 279 new,” he said
Published in The Express Tribune, June 15th, 2016.