ISLAMABAD: The government has released about Rs144 billion for the Public Sector Development Programme (PSDP) during the first nine months (July-March) of the current financial year, accounting for 48 per cent of the total annual allocation of Rs300 billion.
The Planning Commission, however, said that Rs144.3 billion released as of March 30, 2012 were made against a normal development programme of Rs228 billion being directly monitored by it and hence the spending ratio stood at about 63 per cent.
The commission explained that the foreign aid component of Rs38.65 billion allocated for the current year was directly spent by the executing agencies against the releases made by foreign agencies while Rs33 billion worth of special programmes were separately dealt with by the Cabinet Division.
An official said the PSDP spending during the same period last year was about Rs130 billion that meant the spending this year was almost 11 per cent higher than the last year’s.
He, however, explained that the last financial year was not an appropriate benchmark to examine spending trends in the development sector because the government had cut down the PSDP by over Rs100 billion or almost 25 per cent in view of serious financial constraints the previous year.
He said that even though the government was facing difficulties in meeting financial requirements of some of the key development projects through domestic resources, a relatively higher inflow of funds from lending agencies would help meet the PSDP allocation of Rs300 billion.
He said economic managers would review the overall financial situation over the next few days to see if there was a need for rationalisation of development programme to divert funds from slow moving and problematic projects to more important projects.
The government had allocated Rs158 billion for infrastructure-related projects for the current fiscal but has released only Rs77.9 billion so far, accounting for only 49 per cent of the total allocation.
The official said the Planning Commission had recently given a presentation to President Asif Ali Zardari on big infrastructure projects facing implementation hitches.
The president had directed a ministerial committee to ensure that some of the major road projects, mostly in Sindh, were completed within next six months even if it required diversion of funds from other projects.
Likewise, the government had allocated Rs128.7 billion for the social sector development but released only Rs62 billion in the first nine months of the current fiscal that accounted for only 48 per cent of the allocation.
Another allocation of Rs3.3 billion was made for some projects against which only Rs1.3 billion have been released, only 39.4 per cent of the allocation.
In addition, Rs10 billion had been allocated for the Earthquake Reconstruction and Rehabilitation Authority, against which the commission released only Rs3.2 billion.
The disbursement stood at 32 per cent of the budgetary allocation.
Under a fund release mechanism put in place by the commission in consultation with provincial governments and federal ministries, the government is required to release 20 per cent each in the first two quarters of
the year, followed by 25 per cent in the third (January-March) quarter and 35 per cent in the last (April-June) quarter.
The federal PSDP was put at Rs300 billion in the budget for 2011-12 financial year that included Rs38.6 billion of foreign aid and Rs33 billion for special programmes. As such, the commission is directly responsible for monitoring projects worth Rs228 billion during the current fiscal year.