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| May 17, 2005 | Tuesday | Rabi-us-Sani 8, 1426 |
NEC to be asked to raise PSDP by Rs70bn
ISLAMABAD, May 16: The Annual Plan Coordination Committee (APCC), which meets here on Tuesday, is likely to recommend an increases of Rs70 billion, in next year’s Public Sector Development Programme (PSDP) from the current figure of Rs202 billion to Rs272 billion. The recommendation will be made to the National Economic Council (NEC).
Prime Minister Shaukat Aziz, who holds the finance minister’s portfolio, will preside over the first session of the meeting and then leave for the National Defence College. The Deputy Chairman of the Planning Commission Dr. Akram Sheikh will look after the rest of the day-long proceedings.
A senior government official told Dawn that the APCC would formally approve a Rs234 billion PSDP finalised by the priorities’ committee, which is 15.8 per cent or Rs32 billion higher than the current year’s PSDP. This involves the highest share of 37 per cent to social sectors and poverty-related expenditure, 32.8 per cent to transport and communication, 20 per cent for the water sector and eight per cent for the power sector.
The APCC would, however, recommend an increase in PSDP allocations to Rs272 billion on the ground that Rs234 billion was lower than that envisaged in the Poverty Reduction Strategy Paper (PRSP) and the Medium Term Development Framework (MTDF).
The allocations under the PRSP and MTDF involved Rs240 billion and Rs272 billion respectively. As such, the final PSDP 2005-06, to be approved by the NEC, at Rs272 billion would be 34.6 per cent or Rs70 billion higher than the current year’s Rs202 billion. The meeting of the NEC will be convened on May 27, 2005, the official said.
The sources said the PSDP was likely to further increase to Rs280 billion at the time of announcement of the federal budget, as some projects were traditionally included in the budget on the recommendations of the President and the Prime Minister. The ministers for finance and planning and development of the four provinces and Azad Kashmir and the secretaries of all the federal ministries would also attend the APCC meeting.
The APCC will also review the implementation of the annual plan for 2004-05, besides finalising next year’s annual plan. It will also review utilisation of PSDP allocations for 2004-05 and finalise PSDP for 2005-06. But the most difficult question before the APCC and NEC would be the deteriorating utilisation capacity of the federal and provincial governments and the slow movement of about 82 projects costing more than Rs500 million each out of a total of 192 such projects.
Of the total Rs272 billion PSDP to be approved by the NEC, Rs204 billion would be for federal projects and the remaining Rs68 billion would be for provincial projects and various corporations. Of this, about Rs137 billion would be allocated for infrastructure sectors which include water resources, transport and communication, power and fuel. The social sectors like education and training, higher education, information technology, science and skill development would get about Rs90 billion.
The low funding utilisation, although significantly higher than last year, during the current year despite higher allocation has been attributed to low disbursements of foreign aid component, law and order and land acquisition problems.
During the current year, too, the highest share was given to the social sectors and poverty-related expenditure with an allocation of 27 per cent of the total, followed by transport and communication sector at 26 per cent of the total allocation.
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