PESHAWAR: The adviser to chief minister on finance, Muzammil Aslam, said here on Thursday that Khyber Pakhtunkhwa was facing shortage of Rs42 billion in receipts under federal divisible pool during February-May period of the current fiscal.

Talking to reporters at finance department, he said that during that period, there had been less payment to the province.

However, he said, it was not immediately clear whether it was KP alone that received less or other provinces also faced the same situation.

Mr Aslam said that they took up the issue with federal finance ministry through a letter. Besides, he said, of Rs69 billion allocated for development of tribal districts under Accelerated Implementation Programme (AIP) and Annual Development Programme, federal government released only Rs22.5 billion to the province so far.

Muzammil Aslam says health, education and security will be prioritised in next budget

He said that the province, despite less releases, spent Rs31 billion on development schemes in merged districts. He said that federal government released Rs6.2 billion under AIP and Rs16.2 billion for ADP.

Mr Aslam said that in the current year federal government set up a committee to oversee utilisation of AIP funds. However, provincial government opposed the committee and took up the issue with ministry of planning and development.

He regretted that federal government neither spent the allocated funds itself nor allowed provincial government to do so. He said that recently provincial government was informed about dissolution of that committee but no notification was issued so far in that regard.

Mr Aslam said that federal government increased current budget for Azad Jammu and Kashmir by 50 per cent and for Gilgit-Baltistan by 36 per cent but it allocated only Rs66 billion for tribal districts against expenditures of Rs104 billion. He said when the erstwhile Fata was merged into KP, it had more than 90,000 government employees; however, since then, 18,000 of them attained the age of superannuation.

He said that despite extension of police, judiciary and other departments to merged districts, the number of government employees was still less than it had at the time of merger. He said that the region was now a part of the province, therefore, the grant in aid practice needed to be abolished and its share should be made part of National Finance Commission (NFC) Award.

Mr Aslam said that currently the province’s surplus budget stood at Rs111 billion. “In case province’s pension fund is taken into account, this amount goes up to Rs170 billion,” he added.

He said that in the next budget, the province would prioritise spending on health, education and security. He said that provincial government released more than Rs2 billion for Peshawar’s safe city project while two other safe city projects in the southern parts of the province also received green light.

Mr Aslam said that in the current fiscal, provincial government had set a challenging own tax and non-tax revenue target of Rs93 billion.

He said that tax collecting agencies were poised to cross the target. He said that tax collection during the current fiscal was 40 per cent above the target so far.

He said that the province’s debt stood at Rs679 billion and it recently refused three to four foreign loans. He said that provincial government also announced to initiate several mega projects including Peshawar-Dera Ismail Khan Motorway, Chashma Right Bank Canal and setting up a transmission line.

Published in Dawn, May 16th, 2025