PESHAWAR, Jan 7: The NWFP government's efforts to secure additional funds from the centre to offset the impact of increased annual salary bill failed as the federal government did not pay heed to its requests, official sources said.

The provincial government had requested the federal government to provide Rs4.5 billion as grant during the current financial year to help it meet the enhanced salary bill, the sources said.

The annual salary bill of the province grew by around Rs2.5 billion during the current financial year because of the 15 per cent pay increase announced recently by the federal government for the public-sector employees.

The province has around 282,000 employees and its salary bill stood at Rs18.9 billion in financial year of 2003-04. The province saw its annual salary bill going up to over Rs4 billion during the last four years because of three raises announced by the federal government for the public sector employees, the sources added.

In an attempt to offset the impact of the latest pay raise, the provincial government sought help from the federal government, requesting it to provide Rs4.5 billion grant.

However, the federal government has so far not responded to the request made a few months back. "The federal government should also help provinces in implementing its decisions by providing them additional funds so that they could meet the financial burden caused as a result of them," said the officer.

The move forced the provincial government to cross the four per cent limit the World Bank did not want it to cross, they added. An official said the provincial government was comfortably adhering to the donor agency's ceiling envisaged under a multi-million dollar loan agreement between the two sides.

Without the pay raise, the ratio of establishment cost in proportion to the provincial GDP, according to the sources, would have settled at around 3.7 per cent to 3.8 per cent.