Development budget: CDWP clears 17 projects but at a higher cost

Faulty planning, scarcity of resources cited as reasons for escalated price.

ISLAMABAD: The federal government has cleared about one-and-a-half dozen projects at a revised but escalated price of Rs225 billion, highlighting the cost overruns due to faulty planning and scarcity of resources.

Headed by Planning and Development Minister Ahsan Iqbal, the Central Development Working Party (CDWP) considered 17 projects that were already approved at different forums and are being implemented.

However, the increase in cost due to several factors necessitated their approval at the revised cost. Most of the projects are being delayed due to a resource crunch. Like the previous government, the Pakistan Muslim League-Nawaz government, too, has cut the development budget to make room for non-development spending – the core reason behind the delay in hundreds of projects each year.

Some of the projects are approved at the revised cost after a change in their design during construction.

On Friday, the CDWP held a meeting where it reviewed 17 revised development projects related to energy, transport and communication, health, education and governance.

While approving the projects at a higher price, the minister vowed to make accountable use of every single penny and said the purpose of scrutiny and monitoring is to reduce the chances of leaving any deficiency in development projects.

The CDWP is authorised to approve projects costing up to Rs1 billion. The projects having cost over Rs1 billion are recommended to the Executive Committee of National Economic Council (ECNEC) for final approval, which is headed by Finance Minister Ishaq Dar.

The CDWP considered 17 projects, already approved, but resubmitted them with a revised cost. It approved seven projects at Rs22 billion and recommended nine projects costing Rs202 billion to ECNEC for final approval.

In the power sector, five projects including Keyal Khawar Hydropower Project, acquisition of land for Diamer-Bhasha Project, Rehabilitation of Guddu Power Project, CASA transmission line were cleared by the CDWP.

Two transport and communication projects, including ‘Acquisition of Land for Gwadar Port Free Zone’, were discussed and a committee, including Balochistan chief secretary and representatives from the Planning Commission and the ministries of finance and ports and shipping is constituted to review and rationalise the cost.

For the next financial year 2014-2015, the government has proposed Rs525 billion for development projects – a sum that is three times less than what has been sought by ministries to complete ongoing projects. To make room for projects that are near completion, the government has directed the ministries to shelve projects that are less than half done.

This will increase the cost of these projects, if these are revived any time in the future.

The PML-N government has so far given priority to non-development projects that is increasing the cost of ongoing schemes, according to planning ministry officials.