The untold story of Punjab

Rs2tr were allocated for development spending in Punjab but govt could spend only Rs1.7tr

A few months ago, I wrote about financial mismanagement in Punjab owing to ambitious infrastructure spending, mounting commercial debt and exponential growth in public expenditure.

But what remained untold was that this mismanagement occurred at the cost of selected impoverished regions of the province, including South Punjab, which stayed severely resource-starved during recent years.

I looked at the data of the last five years (FY13 to FY18), available with Punjab’s Planning and Development Department, about where the provincial and district development funds were spent.

The geographical distribution of resources narrated a shocking story that unfolded in Punjab, featuring rulers of Takht-e-Lahore, lesser citizens of South Punjab and bureaucratic jugglery.

Lahore with 11 million citizens constitutes about 10% of Punjab’s population. Yet out of the total development spending of Rs1.7 trillion during the last five years, a massive 50% or Rs853 billion were spent in Lahore. On a per capita basis, the province spent 25-30 times more on a citizen of Lahore than a citizen of Layyah, Pakpattan or Chiniot.

How did this go unnoticed? It seems that Punjab adopted two strategies to make that happen. First was to unrealistically balloon the annual development programmes, knowing full well that these resources wouldn’t be available.

And the second was to keep the original allocations much more reasonable but changing them altogether after the budget approval, through re-appropriations and supplementary grants.

During the last five years, a total of Rs2 trillion were allocated for development spending in Punjab but the government could spend only Rs1.7 trillion. Despite this 16% unutilised budget, Punjab ended up at the brink of bankruptcy, rather than having a surplus.

This shows a deliberate ‘padding’ of development budget. Moreover out of the original Rs2 trillion allocation, only 19% was allocated to Lahore, which though was double than its population share, it still fell within tolerable limits to keep it off public scrutiny.

The next question then arises is that who paid for this additional 30% that went to Lahore over and above its allocated share. A quick comparison reveals that while rest of the province only had to forego about 7% from its promised allocations, South Punjab was deprived of about 43% of the allocated budget.

The difference was highest for DG Khan division, which actually received less than half of what was promised. So ultimately, it was South Punjab that had to pay for this preferential treatment to Lahore.

While each of the three South Punjab divisions — Bahawalpur, Dera Ghazi Khan and Multan — has roughly the same population as Lahore district, the provincial capital claimed 10 times as much resource as Bahawalpur and DG Khan and 6.5 times as much as Multan division.

The overall development spending in the province was also skewed, as the average per capita expenditure for South Punjab remained less than half of that of the rest of the province.

Interestingly, when one looks at the national resource allocation formula, smaller provinces like Balochistan and Khyber-Pakhtunkhwa get more resources than their population share, on account of backwardness.

Such equitable distribution of resources, in fact, defines what a federation stands for. But it seems that this claim over federation enjoyed by Baloch and Pashtuns was not allowed to the lesser citizens of South Punjab, who received far less than their population share, despite having a severe development deficit.

While politicians keep on discussing whether and how to carve new provinces out of Punjab, sitting in their cosy offices overlooking state-of-the-art infrastructure, shiny ring roads and massive mass transit projects of the provincial metropolis, it becomes quite clear that these marginalised regions will be much better off on their own, rather than being part of a Lahore-dominated province.

Published in The Express Tribune, February 5^th, 2019.

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