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ISLAMABAD: The government cut the development budget by about Rs87 billion or 16 per cent during last fiscal year ending June 30, 2015, and yet its budget deficit exceeded the target by 0.4pc of the GDP to 5.3pc.
In its fiscal operations data on fiscal year 2014-15, the ministry of finance confirmed on Friday that the federal and provincial governments actually utilised on development projects Rs987.7bn of the Rs1.175 trillion earmarked in the budget.
It said the federal government’s public sector development programme (PSDP) for 2014-15 concluded at Rs489bn against a budgetary allocation of Rs525bn, showing a shortfall of about 6pc.
The provincial annual development plans (ADP) were also contained at Rs499bn from the budgetary allocation of Rs650bn. The cuts in development projects were imposed to meet the fiscal deficit limit set at 4.9pc of the GDP. The limit was exceeded by a margin of 0.4pc of the GDP.
The finance ministry said the year-long efforts for tax expansion contributed a negligible 0.1pc of the GDP (about Rs27bn). The total revenue during fiscal year 2014-15, stood at 14.4pc of the GDP against 14.3pc of the GDP a year before.
This was despite some improvement in tax revenue. During the last fiscal year it amounted to 11pc of the GDP against 10.1pc of the GDP a year earlier. Non-tax revenue, however, dropped to 3.3pc of the GDP in 2015 from 4.2pc in 2014.
Total expenditure, on the other hand, worked out at 19.7pc of the GDP last year compared to 19.8pc a year earlier. A significant increase was, however, witnessed in current expenditure that rose to 16.2pc of the GDP last year from 15.8pc a year before.
While the defence expenditure remained static at 2.5pc of the GDP, the expenditure on mark-up payments rose to 4.8pc of the GDP in fiscal 2015, compared with 4.5pc a year before.
Development expenditure on the other hand declined to 4.2pc of the GDP last year from 4.9pc of the GDP a year before.
Published in Dawn, August 29th, 2015
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