Outstanding payments: Govt set to raise hydel payments issue

The chief minister has approved the summary prepared by the Finance Department.

LAHORE:

The Punjab government will take up the issue of Rs15.5 billion arrears of net hydel profit (NHP) with the federal government through the Council of Common Interest (CCI), The Express Tribune has learnt.

An official close to the development says last week, the chief minister approved a summary prepared by the Finance Department to take up the matter of early payment by the federal government.

Article 161-2 of the Constitution reads, “The net profits earned by the federal government, or any undertaking established or administered by the federal government, from bulk generation of power at hydro-electric stations shall be paid to the province in which the station is situated.”

The federal government has not paid the share of NHP to the Punjab its share since 1996.



In 2009, the chief minister had written a letter to then prime minister, saying that while federal government paid Rs13 billion of Rs28.5 billion in outstanding dues, it still had not paid Rs 15.5 billion from financial years 1996-97 and 2004-5.

It was decided the federal government would pay the amount in three instalments in financial years 2010-11, 2011-12 and 2012-13 but no payment has been received.

The provincial assembly two months ago passed a resolution urging the federal government to clear the outstanding NHP dues as early as possible.

The government noted that it was facing shortage of funds to run routine public affairs in the province and was getting overdrafts from the State Bank of Pakistan.

Now it has been decided to raise the issue at the CCI.

Energy Department additional chief secretary has proposed that the CCI be asked to issue directions to the Ministry of Water and Power secretary to decide modalities of the payment.

The chief minister has given his consent to raise the issue at the CCI for a permanent decision, an official of the Chief Minister’ secretariat told The Express Tribune.   

In 2010, the State Bank of Pakistan had enhanced its overdraft limit from Rs27 billion to Rs37 billion, to enable the Punjab government to deal with its financial constraints.

The limit has been raised to Rs46 billion this financial year.

The cash balance for the month of January is at Rs26 billion. “It is not sufficient to meet the monthly expenses,” an official of the Finance Department told The Express Tribune.

Published in The Express Tribune, January 12^th, 2014.