PESHAWAR, June 8: Keeping in view the next general election, the coalition government of Khyber Pakhtunkhwa unveiled on Friday a Rs303 billion balanced budget for 2012-13, showing a whopping 29 per cent increase over the outgoing fiscal year’s expenditure. An all-time high amount of Rs97.4 billion has been set aside for the annual development programme.
The budget, presented by provincial Finance Minister Engineer Humayun Khan, envisages raising the number of government employees to 385,518 from 377,132.
The government intends to create 8,300 more jobs at a time when its finance managers are finding it difficult to manage a growing salary and pension bill of the province.
“The salary budget of the province is increasing at an alarming rate,” the budget document (white paper) says, adding: “The operational budget for maintaining the existing service delivery network (like provision of medicines, classroom consumables, repairs, agricultural inputs, utilities etc) is declining in real terms.”
The expenditure, including payment of salary, pension, debt-servicing, subsidy, obligatory investments, operation and maintenance, will go up to Rs191.6 billion from Rs161 billion incurred during the current fiscal year ending on June 30.
“Although the provincial government is faced with financial pressure, it is pleased to give in accordance with the federal government’s decision a 20 per cent ad hoc relief in pay and pension to its employees,” the finance minister said.
The decision involves a financial cost of Rs15 billion every year. The coalition government of Awami National Party and Pakistan People’s Party appears to have been carried away by the Punjab government’s laptop computer scheme. Khyber Pakhtunkhwa will launch a Rs1 billion ‘Naway Sahar’ (new dawn) laptop scheme under which some 25,000 students with 16 years of education will be given laptop computers. One hundred laptops will be distributed among ‘top students’ of intermediate level.
Humayun Khan said the government would spend Rs5.2 billion on pro-poor welfare schemes, including the laptop scheme.
In continuation of its previous years’ tradition, the government posted a positive balance sheet reflecting the receipts and expenditures at Rs303 billion for 2012-13. However, the budgetary plan, in greater probability, is most likely to experience hiccups if one goes by the government’s revised budget estimates of the outgoing financial year that shows a net deficit of Rs5.2 billion -- total revenue receipts at Rs254.9 billion and expenditure at Rs260 billion.
The increase has been the result of unbudgeted transfers to the district governments and growth in expenditure on account of “public order and safety affairs”. The government spent a cumulative amount of Rs9.5 billion more than the amount envisaged under the two heads.
Out of the Rs303 billion general revenue receipts estimated for 2012-13, Rs183 billion will be raised through federal tax assignments, Rs22 billion on account of special funds the province receives from the federal divisible pool to compensate its losses because of the war on terror, Rs22 billion to be received as straight transfers, Rs9.8 billion from GST on services, Rs6 billion from the province’s annual share of net hydel profit and Rs25 billion on account of arrears of net hydel profit. The government has estimated that it will raise Rs2.4 billion profits from hydel power generation units run in the provincial public sector and Rs7.8 billion on account of multiple provincial receipts. The province’s own receipts estimated for the next financial year reflects a slight reduction, compared to Rs7.9 billion likely to be raised in the outgoing financial year.
Out of Rs303 billion expenditures, Rs43.9 billion will be spent on general public service, Rs83.8 billion will go to 25 district governments, Rs28 billion to public order and safety affairs, Rs11.4 billion to economic affairs departments, Rs7.2 billion will be spent on health (excluding health education), Rs10.1 billion on education affairs and services, Rs4.5 billion on social protection, Rs604 million on recreation, culture and religion and Rs22 million on environmental protection. In all the government has estimated to spend Rs191 billion on its current budget.
On the current capital expenditure side, the province has planned to retire Rs4.2 billion against its foreign liabilities of Rs121.372 billion. Another Rs3.69 billion will be repaid against Rs9.16 billion federal loans. Another Rs6 billion capital expenditure will be incurred on account of the provincial government’s financial and fiscal affairs.
WELFARE SCHEMES: Under the pro-poor welfare initiatives, the government will spend Rs500 million on farm mechanisation, Rs500 million on Begum Nusrat Bhutto Oncology Services, Rs1 billion on long-term financing facility for development of industries in the province.
For other social welfare schemes, an amount of Rs39 million has been set aside for payment of stipends to unemployed post graduates, Rs10 million for subsistence allowance to senior citizens, Rs15 million for the child protection commission and Rs20 million for the grant-in-aid to disabled persons.
An amount of Rs1 billion has been allocated for the Bacha Khan Khapal Rozgar scheme, Rs1.3 billion for Pakhtunkhwa Hunermand Rozgar scheme, Rs150 million for Riwaiti Hunermand scheme, Rs1 billion for Benazir health support programme (patients of hepatitis-C) and Rs600 million for setting up information technology parks in the province.
The government intends to spend Rs2.5 billion as subsidy on wheat, up from Rs2 billion revised expenditure incurred during the outgoing financial year.
The province’s annual pension bill has been estimated to go up to Rs21.5 billion, an increase of Rs5.6 billion over the outgoing year.
The annual salary bill has been estimated to increase to Rs115.4 billion from the current year’s Rs94.2 billion.
While expenditures on account of pension and salary are slated to go up considerably, the government has reduced monetary allocations on account of ‘repairs and maintenance’.
An amount of Rs2 billion has been set aside for repairing roads, highways, bridges, buildings and structures, showing a reduction of about Rs500 million over the revised estimates of Rs2.5 billion.