ISLAMABAD: Finance Minister Ishaq Dar blamed provincial governments on Wednesday for the lack of proper implementation of the seminal 18th Amendment, claiming this was why the federal government couldn’t proceed with a fresh National Finance Commission (NFC) award before presenting the budget for 2016-17.

“The implementation of the 18th Amendment remains a challenge, requiring the federal government to make regular interventions in provincial affairs in the form of subsidies, apart from giving them their due share in the federal divisible pool,” Senator Dar explained before the passage of the finance bill.

The National Assembly passed the Finance Bill 2016, along with supplementary grants for expenditures incurred in FY2015-16, worth around Rs261 billion.

The version of the money bill that was passed on Wednesday contained several amendments based mostly on recommendations made by the Senate. While some of the opposition’s concerns were incorporated, none of the opposition-sponsored amendments were passed.


Finance Bill 2016, Rs261bn supplementary grants approved


During his policy speech, Mr Dar highlighted the health and education sectors as areas where the provinces were found wanting, adding that the federal government had to come to their rescue every now and then.

He also told the house how two provinces had waited until April to nominate new members for the commission, which hampered the federal government’s efforts in proceeding with resource distribution under the NFC.

The minister expressed dissatisfaction with the collection of revenues by the provincial governments. However, Mr Dar reiterated that the postponement of the NFC award did not bar the government, constitutionally, from managing the national economy.

Several opposition lawmakers, including Leader of the Opposition Syed Khursheed Shah, had accused the government of committing a constitutional violation by not constituting a fresh award within the stipulated five-year period after the last one was finalised in December 2009.

Shedding light on the bifurcation between the federal and provincial governments regarding the collection of revenues and their distribution, Mr Dar said that through an amendment to the finance bill, it was being made mandatory for the provinces to make timely payments of the dues they owed the federation. “Payables are payables and receivables are receivables, no one can be above the law,” the minister maintained.

In response to queries about how Chinese investment specific to the China-Pakistan Economic Corridor (CPEC) was distributed among the provinces, the minister said that out of $45bn, $35bn would be spent on energy projects funded through the private sector. “Electricity produced as a result of these projects will be added to the national grid, hence the whole country will benefit,” he explained.

The minister clarified that there would be no change in CPEC’s western route, as was feared by some quarters. He also said the government was renegotiating the free trade agreement with China, signed in 2007.

Referring to the government’s initiatives to bring looted money back from Swiss banks, Senator Dar said that talks were ongoing, with Swiss authorities and to become part of the multi-lateral Organisation of Economic Cooperation and Development (OECD).

He said the OECD forum, which was due to become operational in July next year, would be of great help as all its members would be able to quickly and digitally exchange information about foreign investments made by their citizens.

This statement was made in response to PTI’s Dr Arif Alvi, who reminded the minister that he had promised in 2013 to bring back the around $200bn stashed away in Swiss banks, which was more than enough to pay off the entire national debt.

Throughout the budget session, the government remained under attack for its massive borrowing, which constituted over 63pc of the GDP. Senator Dar admitted this was a serious issue, which required across-the-board consensus to bring loans down to the constitutionally-mandated 60pc of the GDP.

He said successive governments needed to make concerted efforts for effective management of the national debt.

Nothing for Gwadar

After hearing lengthy speeches about the government’s plans for the port city, the house on Wednesday heard from Gwadar MNA Sayed Essa Nori. The picture he painted was nowhere as rosy as the one painted by the treasury.

“We’re told that there is Rs 800bn in the budget for development, but Balochistan finds no mention there. There is not even a small scheme for Gwadar in this budget. Everyone who speaks on the house floor talks about the CPEC, but it is surprising that there is not a dime’s worth of allocations for Gwadar or Balochistan, where the corridor is located.”

He rued that while a port was being established in his town, there were no schemes to uplift the local population, least of all to impart skills training.

“We were hoping there would be something in this budget for the education of Gwadar’s people, but there is nothing. I understand it’s not possible to establish a university there right now, but the least you could do was give Gwadar’s youth allocations in some other university. We are being given the impression we are not important.”

He called for an end to the attitude of “otherness” towards the people of Balochistan, saying it should be replaced by an air of “inclusiveness”.

Published in Dawn, June 23rd, 2016

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