Sowing the seeds: Major chunk allocated to local govt, districts

Around 30% of ADP for local bodies in addition to Rs102b

PESHAWAR:

The Khyber-Pakhtunkhwa government seems to be delivering on its promises of devolving powers to the grass-roots level by allocating a major portion of the 2015-16 development budget for expenses of the newly-formed local governments.

The provincial government on Monday presented its annual budget of Rs487.884 billion for 2015-16 with Rs174.884 billion set aside for the Annual Development Programme (ADP). Besides Rs42 billion of the ADP 2015-16 going to the local government, an additional Rs102.384 billion would be set aside from the general budget, bringing the total to over Rs144 billion.



This would include Rs98.555 billion for salary expenditures and Rs5.303 billion for non-salary expenditures of the local government.

Presenting the budget at the K-P Assembly, Minister for Finance Muzaffar Said seemed enthusiastic as he announced the prospect of devolving powers to the grass-roots level—a major objective of the PTI-led government.

Said provided details of the ADP allocation for local government and revealed over Rs13 billion was earmarked for village and neighbourhood councils, while more than Rs8 billion would be left at the disposal of district and tehsil governments.





“Rs12.3 billion will be transferred to those government departments that are going to be devolved in accordance with the Local Government Act 2013,” he added.

Opposing opposition

The minister initially faced resistance from opposition parliamentarians when he started his budget speech. Opposition leader Maulana Lutfur Rehman, joined by parliamentarians from Jamiat Ulema-e-Islam-Fazl, Awami National Party and Pakistan Peoples Party, shouted slogans of “shame shame” as the speech commenced. They registered their protest and rejected the budget by walking out of the session. This gave Said the necessary silence to announce K-P’s 2015-16 budget.



Said highlighted the achievements of the K-P government in FY 2014-15 before announcing next year’s budget and a supplementary budget of Rs26.39 billion for the current year.

Not quite tax free

Said called the new budget “tax free” as not a single new levy was imposed. However, there was an increase in existing taxes under certain heads such as commercial property tax. Similarly, the tax on CNG stations, petrol pumps and service stations was increased along with a rise in levies on commercial vehicles and automobiles with heavy engines.

It was also suggested that taxes coming under the transport department such as parking fee, route permits fee and others be increased.



Public benefit

“We have allocated more funds for already running projects so the public can benefit,” the minister said. He added under the ADP, there are 1,525 development projects across the province, including 911 ongoing schemes.

Besides local government and devolution of powers, this year’s budget seems to prioritise education and health by allocating over Rs97 billion and more than Rs29 billion, respectively, for the sectors from the current revenue expenditure heads.

Little solace for govt servants

The 2015-16 budget did not bode well for government employees as there was an increase of just 10% in their salaries and pensions. However, the finance minister said this was a “comprehensive relief package”.

Like the Centre, the K-P government also increased the medical allowance of government employees by 25%.

Talking about the benefit of the China-Pakistan Economic Corridor (CPEC), the minister said 19 development projects were referred to the federal government to be included in the Private Sector Development Programme (PSDP). These included 10 energy and power sector projects, eight schemes for irrigation.  For youngsters, particularly those with technical skills, the government planned to start Youth Challenge Fund Scheme under which they can get loans of up to Rs2 million from the Bank of Khyber to start small and medium level businesses.

Published in The Express Tribune, June 16^th, 2015.