RAWALPINDI, June 20: The Punjab government has waived off the outstanding loan liabilities of Rs4 billion due to the Tehsil Municipal Administrations (TMAs) and Water and Sanitation Agencies (WASAs) throughout the province.

Officials said the TMAs and the WASAs owed this amount to the provincial government on account of water supply, sewerage and drainage schemes. Water and Power Development Authority (Wapda) dues paid by the government on behalf of the TMAs and the WASAs up to June 2003 have also been waived off.

The officials said the decision would help the TMAs get full share from the Urban Immovable Property Tax during the financial year 2003-2004.

The decision, they said, would reduce receipts of the provincial government from the head of recovery of loans and advances but would improve the financial health of these institutions.

The government took this decision to provide a sufficient fiscal space to these bodies for improved services delivery. The district governments, local bodies and autonomous bodies like development authorities and WASAs falling under the control of the provincial government owe Rs47,634.2 million to the Punjab government.

According to the breakdown of this outstanding amount, Rs2575.297 million were due to local bodies; Rs43,328.52 million to autonomous bodies and Rs1,730 million to the district governments.

The debt burden of the local bodies in the province was adversely affecting their performance for the past decade or so, the officials said. They said this decision was continuation of the government’s policy of ensuring adequate flow of funds to the nascent local governments.

The provincial government has also enhanced the annual allocation for the local governments during the financial year 2003-04 by Rs 5billion.

Besides, the Tehsil Municipal Administrations would also be able to get an additional Rs2 billion from property tax transfers.

Meanwhile, the officials said the provincial government would further support the TMAs by allocating over Rs8 billion in the next three years in addition to their own resources, thereby increasing access to potable water and sanitation.