Budget 2014-15: Govt increases proposed development allocation

Suggests boosting amount to Rs525b from Rs506b.

ISLAMABAD: The federal government has increased the proposed allocation for next year’s development budget to Rs525 billion amid competing demands from ministries that are seeking 50% more funds to keep the pace of work against ongoing schemes than what has been indicated to them.

For the upcoming financial year 2014-15, the Ministry of Finance had initially indicated a development budget of Rs506 billion – 6.2% less than this year’s budget. The budget for Public Sector Development Programme (PSDP) has now been increased to Rs525 billion, said sources in the Ministry of Planning and Development.

Out of that, Rs425 billion will be allocated for ongoing schemes – equal to the amount allocated for ongoing schemes in this year’s budget. A sum of Rs100 billion has been earmarked for new initiatives to implement projects under the ruling party’s development agenda, according to sources.



The formal process to approve financial year 2014-15’s development budget has already begun with the Priorities Committee – the inter-ministerial body – holding its meetings with all the government ministries and departments.

The Ministry of Planning had sought proposals against the Rs425 billion development envelope, set aside for ongoing schemes. Against this amount, the combined demand by all the federal ministries and departments was more than Rs650 billion, according to an official of the Ministry of Planning.

“In total, all the ministries have sought around Rs1.5 trillion to carry out work on both, new and ongoing schemes,” said Minister for Planning, Development and Reforms Ahsan Iqbal while talking to The Express Tribune.

Terming it a wish-list, the planning ministry has already started deliberations with the ministries to reduce the list to a level that is not only in line with the governments’ priorities but also justifies the resources’ allocation.

Over the years, the development projects are facing delays, as the uplift budget always remains an easy target to slash expenditures at the name of austerity. Against this year’s Rs540 billion, actual spending is expected to be even lower than Rs400 billion, according to sources in the Ministry of Planning.

For the current year, the federal government has already decided to slash the Rs115 billion allocation for new projects due to shortfall in tax revenues while the remaining Rs425 billion for ongoing schemes may not be fully disbursed.

To rationalise the ministries’ wish-list, the Minister for Planning, Development and Reforms held a meeting with federal secretaries of the ministries.

Iqbal said that he has directed the ministries to give first priority to only those projects in next year’s programme where at least 70% work has already been completed.

Published in The Express Tribune, April 30^th, 2014.

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