K-P budget: A governing vision at last

PTI-led government focuses on service delivery, improving infrastructure and tax collection.

PESHAWAR:

The Pakistan Tehreek-e-Insaf appears to be making good on its word to prioritise economic growth and public service delivery in its first governing document, announcing an Rs344 billion budget that offered far fewer complaints directed at Islamabad and significantly expanded allocations for education, healthcare, and infrastructure.

Announced by Finance Minister Sirajul Haq in the Khyber-Pakhtunkhwa Assembly on Monday, the total budget is about 17.3% larger than the outgoing fiscal year’s budget, with a development budget of about Rs118 billion, nearly 40% larger than fiscal 2013. The single largest chunk of the development budget will be allocated towards education, followed by infrastructure development, including drinking water and sanitation infrastructure.

Education has the largest total share of the provincial budget, with nearly 30% being spent on education, a  substantial increase over last year. However, it was quickly learnt that the percentage increase being cited by many television channels on Monday afternoon was largely the result of an account change: the salaries of public school teachers, the single biggest expense on education, was previously being categorised as “general public expenditure” and was re-categorised under the education budget by the PTI-led government, rendering a comparison of this year’s budget with last year’s budget difficult.



The provincial government appears to also have announced an austerity drive, which relies on trying to cut non-salary expenses at the governor’s house and the chief minister’s house, as well as other high-end provincial government properties, by about 50%. It remains unclear, however, how much money this would actually save the government. The PTI-led government also sought to address the extreme reliance of the province on revenue transfers from the federal government. Sirajul Haq announced the creation of the Khyber-Pakthunkhwa Revenue Authority, which would have the responsibility to collect all provincial taxes and levies. It is not immediately clear if this authority would be an independent entity or whether it would amount to simply a renaming of the current provincial revenue department.

Among the revenues that the provincial government is targeting is a general sales tax on the province’s tourism industry. The provincial government has now begun an advertising campaign to lure back tourists and earn more revenues, touting the safety of Swat after the military campaign to rid the region of militants.

Following the lead of the federal government, the K-P government will also be giving its employees a raise, though the 15% raise in the province is higher than the 10% raise announced by Islamabad.

Among the biggest innovations of the PTI-led government was a far higher degree of transparency about the way the province conducts its accounting.



There were, however, some strange blind spots in the budget. In a province wracked by an extremely violent insurgency, the law enforcement budget was increased only by 11.3%, not far above the current year’s inflation number of 8%.

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