December 5, 2002	Thursday	Ramazan 29,1423

PESHAWAR, Dec 4: The looming financial crisis owing to shortfall under direct federal transfers and non-payment of net hydel profit share by Water and Power Development Authority is likely to affect the financial disbursements to the district governments in the Frontier province, according to official sources.

The province recorded around Rs3 billion shortfall under the direct federal transfers during the first four months of the current financial year (on proportionate basis). Whereas, Wapda has yet to start disbursements to NWFP against its Rs6 billion capped share amount on account of net hydel profit.

In all the provincial government’s over all receipts appear to be around Rs6 billion less than the amount it should have raised during the first four months of the current financial year.

“If the situation does not improve in the near future, the provincial government is all set to experience a serious financial crisis,” said a member of the outgoing provincial cabinet.

Revenue raised by Peshawar in the form of direct federal transfers from the federal divisible pool and net hydel profit jointly forms the main stake of the provincial government.

The Rs21.97 billion estimated share from the federal divisible pool for the financial year 2002-03, makes 56.8 per cent of the Rs38.6 billion over all revenue receipts the province is likely to end up during the current financial year. Similarly, the Rs6 billion capped share amount for the financial year 2002-03, makes over 15.5 per cent of the total expected revenue receipts of the province.

Taking up the issue of non-payment of net hydel profit, once more, with the Wapda, the provincial government has pointed out the looming financial crisis’s possible fallout on the disbursements to the district governments in the near future.

According to the sources, in a recently sent letter, the provincial government has pointed out to the utility that continuation of non-payment of net hydel profit share is likely to affect the provincial government’s capacity to release funds to the district governments.

“Disbursement of funds to district governments in accordance with their respective allocations — earlier made for the current financial year — would not remain possible for the government in view of the imminent resource constraints the province is set to undergo in the second half of the current fiscal year due to non- payment of net hydel profit share,” said the sources.

The fresh letter to Wapda has come in line with couple of other reminders the provincial authorities sent earlier since the beginning of the current financial year seeking payment of net profit share.

“All the earlier letters sent to the utility did not receive positive response,” said the sources, anticipating no change in Wapda’s stand in response to the recently sent official communique.