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PESHAWAR: The caretaker government in Khyber Pakhtunkhwa has unveiled a spending plan of Rs462.4 billion for the first four months (July to October) of the coming fiscal year.
It plans to spend roughly a quarter of the total outlay on development projects and, in line with the federal budget, raised salaries by up to 35 per cent and pensions by 17.5pc.
With total expenditure of Rs462.4bn and revenue of Rs442.6bn, the four-month budget estimates a deficit of Rs19.8bn.
The KP adviser on finance Himayatullah Khan, presented the salient features of authorised expenditure at a press conference at the Civil Secretariat’s cabinet room on Tuesday.
Under the July-October spending plan, Rs350.4bn has been allocated for current expenditure, including Rs 309.5bn for settled districts and Rs40.5bn for merged districts, formerly called the Federally Administered Tribal Areas (Fata).
Revenue projected at Rs443bn; salaries, pensions raised in line with federal budget
The caretakers also plan to spend Rs112.4bn on development, of which Rs92.1bn would go to the settled and Rs20.3bn to merged districts.
Some Rs35.4bn would be spent on increasing salaries, pensions and other allowances of the provincial government employees.
As for the receipts of Rs442.6bn, the province would receive over Rs249bn from federal taxes, Rs29.9bn from the 1pc of the divisible pool on account of the war on terrorism, Rs13.2bn from straight transfers, Rs10bn in net hydel profit (NHP), and Rs18.3bn in NHP arrears.
The province is also expected to generate Rs28.8bn in its own tax and non-tax revenue — i.e. Rs18.8bn from taxes and Rs9.5bn from non-tax sources. Similarly, foreign funding for development projects has been pitched at Rs37bn.
The receipts for merged areas are projected at over Rs42bn, including Rs22bn for current expenditure, Rs8bn for development projects and over Rs10bn for the Accelerated Implementation Programme.
Of the Rs309.5bn total current expenditure for settled districts, over Rs84.5bn has been allocated to provincial salaries, Rs77.7bn for district salaries, Rs42bn to pensions, Rs76.6bn for non-salary expenditure, Rs9.8bn for district non-salary, and Rs8.4bn for capital expenditure.
Similarly, of the merged districts’ Rs40.5bn current expense, Rs18.2bn will go to provincial salaries, Rs12.5bn to district salaries, and Rs361 million to pensions. The non-salary expenditure is estimated at Rs9.5bn.
As for development spending in settled areas, Rs43.3bn has been allocated for settled districts’ annual development plan (ADP) and Rs8.6bn for district ADP. Besides, Rs37bn would be spent on donor-funded projects and Rs2.99bn on the Public Sector Development Programme.
The merged districts’ development expense includes Rs8.6bn ADP, Rs10.3bn Accelerated Implementation Programme, and Rs 1.26bn donor assistance.
The provincial government will provide Rs3.5bn to the Peshawar Bus Rapid Transit in subsidy, while the Sehat Card insurance scheme funding will also remain unchanged.
The KP caretaker government has approved a 35pc ad hoc allowance to provincial government employees in Grades 1 to 16, and 30pc to those in Grades 17 and above.
This will cost the province Rs29.7bn in four months. Similarly, a 17.5pc pension raise will cost Rs5bn.
In addition, the caretakers have also increased the travelling allowance for provincial government employees by 50pc and doubled the secretariat allowance to 100pc. The two measures will cost the province over Rs600m.
Besides, the deputation allowance of the provincial government employees has been increased by 50pc. The government has also increased the minimum wage to Rs32,000 from the existing Rs26,000.
In his press conference, Mr Khan, the provincial finance adviser, said the caretaker government was running the affairs of the province in difficult circumstances, but it still didn’t resort to borrowing from the State Bank of Pakistan.
He said the province received Rs5bn out of the Rs62bn arrears of the NHP. Moreover, taxes levied in the outgoing fiscal year would remain during the next four months as the caretaker government could not impose taxes, he said.
Published in Dawn, June 21st, 2023
