Senate panel seeks release of funds for small dams

Finance ministry oppose 10% salary increase of govt employees

ISLAMABAD: The Senate Standing Committee on Finance on Thursday directed the Ministry of Planning, Development and Reforms to ensure appropriate release of funds allocated for the construction of small dams and water conservation projects in Public Sector Development Programme (PSDP) for the financial year 2018-19.

With Senator Farooq Hamid Naek in the chair, the committee discussed at length the recommendations on the Finance Supplementary (Second Amendment) Bill, 2019. While the standing committee agreed to most of the recommendations, some of them were declined.

It also unanimously proposed for 10 percent increase in the salaries of government employees due to increasing inflationary impact on an ordinary person. Suggested by Senator Khanzada Khan, it was supported by Senator Ayesha Raza Khan. However, officials of the ministry of finance opposed the suggestion due to increasing fiscal deficit.

Meanwhile, recommendations pertaining to provinces were forwarded by the committee to the concerned provincial departments.

Senator Kulsoom Parveen’s recommendations for cutting tax rate on coal extracted from Balochistan and release of Rs5 billion funds for construction of dams in the same province were approved as well as another proposal for setting up a cancer hospital in Quetta.

The committee also took up Senator Sirajul Haq's recommendation for eradicating interest from the country's economy. Officials from the State Bank of Pakistan (SBP) said that the country was seeing an increase in Islamic banking with 2,850 branches and 22 institutions offering Shariah-compliant financing products. The committee returned the recommendation after SBP officials convinced it that the matter was being addressed.

Senator Muhammad Usman Kakar's proposal to issue air travel allowance to senators in the form of cash rather than 25 air tickets was also approved by a majority while recommendation of the Senate Deputy Chairman Saleem Mandviwalla relating to exemption of sales tax on locally supplied soya bean oil was declined.

Recommendation for continuing regulatory duty on export of recycled material and for inclusion of Pakistani items in the FTA contract with China were also approved.

The committee also approved the recommendation for expediting construction and expansion works of infrastructure projects including the Taxila-Haripur Road and Hawelian to Abbotabad road. The committee was told that road between Shah Maqsood to Mansehra will be completed by December.

It accepted recommendations for expediting distribution of compensation funds for victims affected by land procured for Bhasha and Dasu dams. A recommendation regarding construction of low-capacity hydel projects in KPK was also approved.

The committee was also informed that tobacco growers and industry in the country were facing problems as Federal Excise Duty (FED) of Rs300 per kg was imposed on tobacco, which had forced the industrialists to shut down their businesses. The tobacco sector was contributing about Rs4.5 billion in terms of revenue and each unit was also providing livelihood facility to 100 to 150 people, she said, adding that tax burden was adversely impacting the sector.

Senator Dilawar Khan asked the Federal Board of Revenue (FBR) to rationalise the SRO 1149 to protect the local industry and attract the foreign investment as well as facilitating the tobacco growers across the country.