November 27, 2001	Tuesday	Ramazan 11, 1422

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ISLAMABAD, Nov 26: A meeting, presided over by President Gen Pervez Musharraf here on Monday approved Rs40 billion new spending programme for social sector.

The meeting reviewed the government’s spending plan following new foreign aid commitments amounting to $1.2 billion, including $600m received cash from the United States as part of budgetary support.

After the meeting, Finance Minister Shaukat Aziz told reporters that the $600 million, equivalent to about Rs40 billion, had been disbursed to Pakistan.

Giving the details, he said Rs25 billion would be used for narrowing the budgetary gap to ensure that public sector development programme and normal government spending were not effected.

Mr Aziz said Rs15 billion had been allocated for social sector projects, including human development, poverty reduction and job creation. The amount will be allocated to the provinces. He said the allocations for Khushal Pakistan Programme had been increased from Rs7 billion to Rs15 billion. The programmes to be undertaken will cover creation of jobs, improvement of infrastructure, housing, sanitation, water supply, schools, health facilities and community driven programmes. He said 1.5 million jobs would be created through the programme.

The allocation for the education sector in the federal budget has been increased by Rs2 billion, which will be spent mostly on the rehabilitation of primary schools. Under the programme, 5,000 schools will be rehabilitated. Another Rs1 billion has been allocated for feeding girls in 5,000 primary schools of 20 districts.

Another Rs2 billion has been provided for health programme, to be used mostly on primary health, immunization and kits for the lady health workers.

The allocations to provinces from the resources will be laid under the National Finance Commission (NFC) award, but Balochistan will get 10 per cent and NWFP five per cent in addition to their share as they are facing refugee problems.

Mr Aziz said the current total budget of the district governments was Rs14 billion and it would almost be doubled with the additional allocation in the social sector and the Khushal Pakistan Programme.

He said that under the debt swap programme, the debts of Germany, Italy, Canada and Norway, totalling more than $414 million, would not be returned and their equivalent in rupees would be spent on job creation and poverty reduction programmes.

He said the president had directed that the money should be spent transparently in line with the objectives of human development and poverty reduction programmes.

The president said the federal government would monitor the utilization of the funds. He said the federal government had laid down the broad parameters but the implementation would be by district governments with the coordination of the provinces.

In reply to a question the finance minister said as far as domestic debts were concerned the country was on target, the cost of domestic debt had gone down because of lowering of interest rates and the government borrowing from the banking sector was under control.

He said the government was negotiating with the Asian Development Bank for the establishment of a fund to reduce the insurance cost.

Mr Aziz said the president had directed that the war risk insurance problem be resolved at the earliest.