According to verified record of the ministry of finance, an amount of Rs934.3 billion was allocated for the provinces from 2002-03 to 2010-11 under PSDP but only Rs171.75 billion or 18.4 per cent of it was utilised. - File Photo

ISLAMABAD: The federal government has reported non-utilisation by the four provinces of about 82 per cent of the allocation under Public Sector Development Programme over the past eight years.

According to verified record of the ministry of finance, an amount of Rs934.3 billion was allocated for the provinces from 2002-03 to 2010-11 under PSDP but only Rs171.75 billion or 18.4 per cent of it was utilised.

The astonishing revelation was made in a report on PSDP allocations to the provinces, along with year-wise releases and actual utilisation, submitted to the National Assembly in response to a question from MNA Khwaja Sohail Mansoor. It is expected to be taken up for discussion when the house meets on Nov 14.

The report apparently suggests that the provinces, which have been fighting for increased shares from the federal divisible pool under the successive National Finance Commission awards, do not have the capacity to utilise even their allocated funds.

It did not analyse the expenditures made to explain how much of the actual spending achieved desired development goals and how much of taxpayers’ hard-earned money went into the pockets of contractors and officials of executing agencies.

When asked where huge allocations were going when utilisation ratio was so low, Finance Secretary Dr Waqar Masood Khan said the fiscal deficit during the entire period had been on the higher side and perhaps the major amount was utilised for containing budget deficit. He said the information had been provided to the National Assembly after proper verification.

Separately, special secretary and official spokesman of the finance ministry Rana Asad Amin claimed that the information provided to parliament related only to the provincial development programmes and did not include allocations under the federal PSDP. However, officials of the finance ministry’s development wing which had compiled the report said the data pertained to the federal allocations and was collected over a period of two months after collecting and verifying data from all the federal ministries.

Sources said the finance ministry was now trying to withdraw the report from parliament to avoid embarrassment to the government, although it had already reached members of the National Assembly.

The finance ministry’s report available with Dawn indicated that the average utilisation varied between 13 per cent and 25 per cent over the eight years in various provinces. Despite affected by continuous war-like situation, Khyber Pakhtunkhwa achieved the highest utilisation rate of 24.96 per cent, followed by Punjab with 23 per cent. Sindh utilised only 13.69 per cent of the allocations and Balochistan 13 per cent.

The utilisation ratio was generally similar both in military and civilian governments. Interestingly, the finance ministry provided details of Rs172 billion allocated to the provinces during 2010-11 along with releases but reported zero utilisation in all the four quarters.

Spokesman Rana Asad Amin said it was because of delayed reporting of details by the provincial governments.

The data suggest the federal government also had a role in lower expenditures on development activities as its releases remained far short of the allocations. But then the provincial governments failed even to consume scaled down releases to the disadvantage of the people.

For example, an amount of Rs291 billion was allocated to Punjab during the eight years but only Rs110 billion was released, accounting for less than 38 per cent. The Punjab administration utilised only Rs66.7 billion or 23 per cent of the allocation.

About Rs225 billion was diverted for current expenditure, including bridging fiscal deficit.

Likewise, the Sindh government got an allocation of Rs241 billion during the period but only Rs65 billion, or 27 per cent were released. The utilisation stood at only Rs33 billion or 13.8 per cent.

Khyber Pakhtunkhwa, which secured an allocation of Rs162.6 billion, got releases of only Rs62 billion or 38 per cent, but utilised Rs40.6 billion or about 25 per cent.

Balochistan was able to get a higher allocation of Rs238 billion, but could utilise only Rs31 billion or 13 per cent.

The report suggest that utilisation of funds against allocations remained as low as 2.15 per cent and 3.7 per cent in Sindh, Balochistan and Khyber Pakhtunkhwa during 2002-3 and 2005-06, but picked up pace in years preceding elections in 2008.

The utilisation ratio increased to 67 per cent in Khyber Pakhtunkhwa in 2007-08 before coming down again to 22 per cent in 2009-10.