ISLAMABAD, May 19: The utilisation of Public Sector Development Programme (PSDP) has remained low and stood at Rs103 billion or just over half of the total Rs204 billion allocated in the first nine months of the current fiscal year.
Official documents available with Dawn suggest that actual expenditure during July 2005 to March 2006 was Rs103 billion of the total allocation, including a foreign aid of Rs10.6 billion.
However, the expenditure of 50.5 per cent of the allocated amount is slightly higher than the development expenditure of Rs72.5 billion incurred during the same period last year (2004-05).
“It is still less than expected, owing mainly to the shortfall in foreign aid disbursement, which was only Rs10.6 billion against the provision of Rs41.2 billion,” an official note to the National Economic Council (NEC) said.
Excluding the foreign aid, the rupee expenditure was 57 per cent of the allocation. Similarly, social sectors have also shown mixed utilisation position at 58.2 per cent.
The planning commission claimed that 90.5 per cent of the Rs113.8 billion amount released by the finance ministry was utilised in the first three months of the current year. The planning commission, however, contends that work completed was much more (20-25 per cent) than the expenditure because there is usually a gap of 2-3 months in the work actually done and payments made to the contractors.
The planning commission conceded that full utilisation of the allocated amount would not be possible at the end of the year. “The expenditure is likely to further pick up in the last quarter of the current fiscal year as reported by the projects’ authorities that Rs193 billion (95 per cent) of the total Rs204 billion federal allocation would be spent up to June 30, 2006,” it said.
Furthermore, additional allocations made to the fast-moving projects after the third quarter would result in speedy utilisation of funds. “The provinces are likely to perform better,” said the planning commission.
A senior official said generally the social sector and infrastructure by and large has shown poor utilisation ratio.
The slow utilisation of funds has happened despite a number of steps taken by the National Economic Council last year to speed up and improve utilisation of funds and detailed quarterly reviews of the development projects by the planning commission and relevant line ministries.
In each quarterly review meeting, the federal secretaries and principal accounting officers were asked to ensure that projects were completed on time within the approved cost and project objectives were fulfilled to avoid cost and time overruns to benefit from the public funds.
Poor utilisation could also not be overcome despite the fact that allocations were re-adjusted from slow- to fast-moving projects after each quarterly review.
“The sectoral allocations after these re-adjustments remained more or less the same because as a matter of policy the identified savings where possible were re-allocated within the same sector to fast-moving projects for their timely completion,” the PC claimed.
