LGs denied Rs74 billion funds in four-year term

Updated Sep 09 2019


Minister claims KP local govts received more money as compared to other provinces. — Reuters/File
Minister claims KP local govts received more money as compared to other provinces. — Reuters/File

PESHAWAR: In a gross violation of Khyber Pakhtunkhwa Local Government Act, 2013 and election manifesto of the ruling PTI, the provincial government deprived the local bodies of their Rs74 billion share in funds throughout their four-year tenure, which ended on August 28.

Data available with Dawn shows that under the Provincial Finance Commission (PFC), the four-year share of LGs amounted to Rs144 billion.

However, the finance department never released Rs74 billion or over 50 per cent of the total amount allocated for LGs that adversely affected development activities at district, tehsil and village and neighbourhood councils.

Minister claims KP local govts received more money as compared to other provinces

Several former nazims, Dawn talked to, said that denial of funds forced them to revise their annual development estimates time and again. They said that they either had to drop development schemes or the projects faced considerable delays.

However, KP Finance Minister Taimur Saleem Jhagra told Dawn that as compared to allocations in other provinces and the Musharraf-era LBs, release of Rs70 billion was a huge amount and a positive development. “So much money was never given to LGs in the history,” he said.

The minister said that Musharraf-era LBs in KP were given only Rs10 billion in a decade and looking at things positively, Rs70 billion was significantly greater amount. He said that due to huge releases of funds to the local bodies, the PTI won elections for the second term in the province.

Details available with Dawn show that in the first financial year 2015-16, after establishment of local governments, the provincial government slashed Rs27 billion from the share of the LG funds and released only Rs15 billion to them of the allocated Rs42 billion.

In the second financial year 2016-17, the share of local governments was Rs36 billion out of which the provincial government released Rs27 billion, depriving the LGs of Rs9 billion.

In the 2017-18, which was the third year of the local governments, the provincial government released only Rs10 billion to the three tiers of the LGs against their share worth Rs37 billion.

In 2018-19, which was the last year of the LG tenure, under the PFC award, the share of local bodies amounted to Rs29.3 billion, however, only Rs18.3 billion was released.

Local Council Association provincial president Himayatullah Mayar told Dawn that declining release of funds to the local governments was violation of KP Local Bodies Act, 2013 and Section 140-A of the Constitution.

Section 53 of the KPLGA states:“---in addition to the establishment charges budgeted for the devolved functions and transfers in lieu of Octroi and Zilla taxes, the development grant for local governments shall be so determined that it is not less than thirty per cent of the total development budget of the province in the respective year”.

While Section 140-A of the Constitution sates: “Each province shall, by law, establish a local government system and devolve political, administrative and financial responsibility and authority to the elected representatives of the local governments.”

Mr Mayar, the former nazim of Mardan, said that provincial government considered the local bodies a stepson and never awarded them their due share in the provincial ADP.

He said that local governments including district, tehsil/town and village and neighbourhood used to prepare annual budgets keeping in view their share intimated to them by the finance department under the PFC award. Unfortunately, he said, the nazims were compelled to change their ADPs for not getting the required funds.

A senior official said that finance department had framed criteria under which only those districts that utilised 60 per cent of the released funds would receive the remaining amount. “There is no logic to release second or third quarter of the funds to the local bodies if the earlier released funds are unspent,” he said.

However, Mr Mayar said that finance department never released the funds on time. Under the financial rules, he said, the finance department must release the first quarter in July, however, it was never done rather the first quarter was often released in October or November.

Published in Dawn, September 9th, 2019