K-P varsities face Rs15 billion fiscal deficit

Report links it to the increase in salaries and pensions

PESHAWAR:

Thirty-four public sector universities in Khyber-Pakhtunkhwa have been grappling with a staggering deficit of Rs 15 billion. Documents obtained by The Express Tribune reveal that the Secretary Higher Education briefed the provincial cabinet about the financial crisis faced by these institutions, urging the government to take immediate and concrete measures to solve the problem.

The documents show that while the universities' total expenditures stand at Rs34 billion per annum, their total income is only Rs18 billion, creating a significant gap. The primary cause of this growing deficit is attributed to the increase in salaries and pensions of the staff members.

According to the documents, a 150 per cent rise in pensions and a 200 per cent increase in salaries have significantly widened the gap between income and expenditures and it is going bigger each passing year.

The financial strain on universities has been exacerbated by the Higher Education Commission's (HEC) freezing of annual grants since 2018.

The HEC had previously provided an annual grant of Rs9.4 billion, but this support has been suspended, leaving the universities to struggle.

In the fiscal year 2023-24, the provincial government issued a grant-in-aid of Rs1.9 billion to help universities cope with the crisis.

However, the documents indicate that universities require an additional Rs13 billion in grant-in-aid and pension liabilities.

Specifically, Rs8.75 billion is needed to clear pending pension payments. The report suggests that if the financial situation isn't addressed soon, universities may face even deeper fiscal difficulties.

To address this issue, the documents propose several solutions.

One of the key recommendations is the establishment of endowment funds to ensure the financial sustainability of universities in the long run. Additionally, there is a suggestion to digitize fee collection and other administrative processes, which would not only streamline operations but also improve transparency and accountability.

On the other hand, the Provincial Minister for Higher Education, Meena Khan Afridi, has acknowledged the financial challenges faced by the universities. Speaking to The Express Tribune, he said that the provincial government is fully aware of the universities' fiscal crisis. He added that the government is working closely with these institutions to develop better policies and allocate necessary funds to pull them out of this crisis.

Afridi emphasized that the government is committed to making universities financially self-reliant and will continue to support them in standing on their own feet. "We are working on both immediate and long-term solutions to ensure that our universities not only survive this crisis but thrive in the future," he added.

The financial difficulties facing K-P's universities are a cause of concern for both the academic community and the students. If left unaddressed, the ongoing crisis could severely affect the quality of education, research, and overall development of these institutions.