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Fund shortage threatening KP rehabilitation projects

July 28, 2012


Women pass by destroyed homes in northern Khyber-Pakhtunkhwa. – AP (File Photo)

PESHAWAR, July 28: A number of 2,500 ongoing development projects in the 2005 earthquake-affected areas of Khyber Pakhtunkhwa are likely to experience stoppage of work in the financial year 2012-13 due to lack of funding, according to official sources.

The Khyber Pakhtunkhwa government has curtailed its work plan 2012-13 for the earthquake-hit areas’ reconstruction and rehabilitation by around 50 per cent and left 1,300 projects out due to unavailability of funds, the relevant officials told Dawn on Saturday.

“It appears that at the end, the provincial government will be buried under a huge liability of completing development projects in the earthquake-affected zone as the federal government is dragging its feet to fulfill its commitment,” said a senior government functionary.

The official said the provincial government had sought Rs19.7 billion for the current financial year from the Earthquake Reconstruction and Rehabilitation Authority (Erra) for the completion of 2,562 ongoing development projects in the Khyber Pakhtunkhwa areas devastated by the 2005 earthquake.

He, however, said over 1,300 projects were likely to suffer either stoppage of work or slow implementation due to shortage of funds after the authority has committed to providing Rs1.5 billion only.

According to official sources, the provincial government does not have the capacity to fund the Provincial Reconstruction and Rehabilitation Authority’s entire work plan for the financial year 2012-13 from its own kitty, so it has revised its plan, slashing the number of projects to be funded in the next 12 months.

Under the revised plan, the government will need Rs5.7 billion for implementing around 1,246 ongoing development projects, including 980 education sector development projects on which 80 per cent and above work has been completed.

The provincial government, said the official sources, had included in its revised plan only those projects on which work had been completed by 51 per cent and above.

The 1,246 projects identified for completion under the revised work plan involve an accumulative estimated completion cost of about Rs16 billion. In many of the cases, work on these projects was near completion, said the official.

“The accumulative expenditure on these projects stood at Rs10.5 billion by the end of the last financial year, bringing down the remaining financial requirements to around Rs5.7 billion that the province has asked for from Erra,” said the official.

The provincial government’s concerns, said an official, were not limited only to the funding required for completing the ongoing development projects. A substantial amount of money, added, the official, was pending payment to the contractors against some of the completed projects.

“The revised plan of Rs5.7 billion does not include Rs2.5 billion liabilities pending payable to the private contractors after some of the projects’ completion cost overshot the actual estimates,” said an official.

Officials said the Erra’s refusal to finance the PRRA’s current fiscal year’s work plan had left the provincial government at the ‘cross roads’ as in the final analysis it appeared that the ongoing projects would have to be completed by the provincial government from its resources in the years to come.

According to the government’s estimates, the total completion cost of the development projects come to Rs35.9 billion.

Most of the projects belong to the education sector followed by health sector, water supply, sanitation and solid waste management, transport, house and physical planning, telecommunication, environment and forest, and power generation.

The reconstruction activities in the earthquake-affected areas, said the sources, got underway in the 2008-09 financial year and since then out of about 6,700 reconstruction and rehabilitation projects launched in different earthquake-affected parts around 4,000 projects had been completed, spending over Rs23.7 billion.

“The reconstruction and rehabilitation requirements of the people affected in seven Khyber Pakhtunkhwa districts affected by the earthquake are huge and the provincial government cannot foot the bill all alone in case if the federal government does not provide the required funds,” said a development planner.

Of the total 4,000 completed projects, 1,671 were completed with foreign funding, according to the official. A good number of the ongoing development works were being sponsored by the multilateral and bilateral donors of the government of Pakistan, said the official.

The foreign donors, including Islamic Development Bank, Saudi Fund for Development, and KFW (a German development agency), according to officials sources, are sponsoring development projects involving total completion costs of over Rs6.4 billion.

However, according to officials, foreign donors’ interest in continuing assistance for the earthquake areas’ uplift is apparently diminishing.

Saudi Fund for Development, said an official, had consented in 2006 to provide over $32 million for the rehabilitation and reconstruction activities in the education, health, and governance infrastructure in the province.

However, later, the Fund refused to sponsor a key component of the education sector, declining to provide funding for the government post-graduate college packs (involving the reconstruction of buildings of postgraduate colleges damaged by the earthquake in the affected parts of the province).