June 14, 2002	Friday	Rabi-us-Sani 2, 1423

KARACHI, June 13: The Sindh Finance Minister Abdul Hafeez Sheikh announced on Thursday the outlines of the proposed interim award of the Provincial Finance Commission (PFC) of Sindh which provisionally suggests allocation of 60 per cent funds for the provincial administration and 40 per cent to be shared by the 16 districts.

The interim PFC award, which has been literally pushed through in utmost haste this month on instructions of the National Reconstruction Bureau (NRB), lays down the criteria for distribution of both the revenue expenditure and development funds between the provincial administration and district governments.

Flanked by the Sindh finance secretary Fazlur Rehman and private members of the PFC, Abdul Hafeez Sheikh said the main purpose of drawing up the funds distribution principles and working out criteria for funds distribution is to make both the provincial and the district administrations viable.

“We expect the journalists to handle this PFC award issue with utmost care in their writings as it is a very sensitive issue,” the minister said while informing the newsmen that this interim award will be a part of the next budget likely to be announced next Thursday.

Population, backwardness, income collection and an interim grant constitute the four major criteria for distribution of revenue expenditure funds to the districts, he said.

Population will be given 50 per cent weightage for allocation of both revenue expenditure and development funds. In case of revenue expenditure, backwardness will be given 17.5 percentage points weightage and income collection 7.5 per cent.

For distribution of development funds, population will be given 50 per cent, backwardness 30 per cent and interim backlog grant 20 per cent.

He said that each of the 16 districts in the province has been ranked according to the number of schools, enrolment of students, health facilities and number of houses. “We have worked out development index of each of 16 districts on the basis of 1998 data,” Dr Masood a research scholar of a private research and consultant organization informed newsmen.

The minister was asked that this development rating of district could be misleading as there are reports which suggest that school and hospital buildings in many rural areas have been converted into ‘autaqs’(parlours) and livestock yards by the influential waderas.

In quite a few districts, talukas and town committees these influential waderas have been elected who have neither the vision, nor the will or ability to provide educational and health facilities to the poor people of their areas.

The Finance Minister said that from next year the district governments showing better results in fiscal discipline, utilization of funds and income generation would be awarded in the budget.

The PFC interim award is silent on the distribution of funds between the districts and their respective talukas, union councils and town committees, and the minister was specifically asked to explain. “We expect Islamabad to announce tomorrow the modalities of 2.5 per cent GST collection,” the minister responded to a question stating that the distribution of funds between districts and their respective units would be decided in light of federal government’s directive.

He said that his announcement of the interim PFC award is “informal” as it has to be approved by the cabinet and the Governor. “But we want to inform the public of the progress of the PFC and the hard work put in by the members,” he said.

Answering another question he said the total resources availability of Sindh will indicate share in the projected taxes collection of the federal government plus the direct transfers on account of oil and gas surcharges. Furthermore, Sindh will get a share in Rs32 billion collection of 2.5 per cent GST.

He said that Sindh has agitated on the issue of high interest rated federal government loans and expect some relief in the next NFC award.

The PFC is headed by the Sindh Finance Minister Abdul Hafeez Sheikh and includes additional chief secretary on planning and development, finance secretary, accountant general and five private members.