October 1, 2007	Monday	Ramazan 18, 1428

The undergoing reforms, initiated seven years ago in the NWFP, will continue even after the political changes in days to come, according to senior officials here.

Financial managers and officials of lending agencies state that these reforms have made a clear progress because of the commitment on the part of provincial leaders and the official functionaries as well.

The political changes after the next polls cannot derail a process that focuses on human development, fiscal and public expenditure management, strengthens the governance and promotes economic growth, they say.

These reforms are the continuation of a three-year multi-sectoral Provincial Reform Programme (PRP-I) originally conceived by the previous military-cum-civilian government in the province for which the World Bank provided $270 million through Structural Adjustment Credit (SAC)-- a budgetary support.

Officials claim that the first phase of the reforms which focused on improving financial management and fiscal sustainability of the cash-strapped province has yielded positive results. Now the reforms are in the second phase, for which $90 million has been provided and another $130 million is expected to be released this month.

The NWFP--heavily depended on external resources--has managed to explore new avenues of revenue mobilisation from its own resources as these reforms helped the tax-collecting agencies in improving the overall revenue collection.

The second phase of the reforms initiated in the FY2004-05, is mainly based on four pillars: accelerating the human development, fiscal and public expenditure management, strengthening the governance and promoting the economic growth.
The major thrust of the reforms is, however, on education and health sectors where a number of measures coupled with policy initiatives have been taken to improve the overall service delivery and pass on maximum benefit to the poor.

Education Department officials say that the overall education profile has improved as the Gross Enrolment Ratio (GER) for the primary stage shows an increase of 81-83 per cent at the base-line which has to reach 85 per cent target within specified time-period. Similarly, measures for expanding equitable access to education have also brought positive changes showing a rise of enrolment from under 3.2 million in 2004-05 to over 3.5 million in 2006-07.

The monthly stipends for girls in grades 6-10 in seven districts with middle and secondary enrolment rates which were below 12 per cent show an increase of 5-10 per cent.

The government has also converted Parent Teachers’ Association (PTAs) into Parent Teachers’ Councils (PTCs) with more fiscal and administrative authority allowing them to use development funds. Moreover the government has also initiated partnership agreements between the provincial and district governments that will have far-reaching impact on the access and quality of education.

The focus of second-phase reforms is on quality improvement, particularly at the elementary stage for which purpose two separate plans--Teacher Development Framework and Sector Plan--have been put in place.

These plans are considered as an integrated package for expansion of access, quality improvement and strengthening of institutional and management capacity.

Health sector is the second priority wherein a number of initiatives, focusing on improving the quality of primary and secondary health care services, have been taken. Moreover, minimum quality care standards have been set, providing a baseline for future improvement in the health system.

But there are some problems too. The World Bank while commenting on these reforms said: “Two of the three models of innovation including increasing management authority, performance based incentives in the public sector are yet to be approved six months after the first appraisal. It is crucial for these models to be approved and implementesd or else the whole approach to test innovative models is likely to fail.”

Initiatives for promoting private sector-led economic growth have been strengthened by forming an Investment Facilitation Council to be chaired by the chief minister and an Investment Facilitation Committee to be headed by the Chief Secretary.
Officials at Industries Department say the management control of all the 16 industrial estates have been transferred to the private sector, which have showed an improvement in management and an increase in revenue collection. Progress has also been witnessed in the key policy area of mining, as the government has notified the appointment of mine magistrates in 20 districts.

The overall fiscal sustainability of the reform programme seems to be robust, with the budget deficit for current fiscal year within the agreed limits of the Medium Term Budgetary Framework (MTBF). However, the procurement reforms has not been fast enough. A high-level delegation of the World Bank is expected to visit the provincial capital sometime in December to review the government performance and work out the modalities for the next tranche of budgetary support for the reforms.