PESHAWAR: The Khyber Pakhtunkhwa government unveiled on Saturday its budget for the next financial year with an outlay of Rs404.8 billion, with a whopping 71 per cent of the total expenditure taken away by salary and pension of its employees.

Presenting the budget in the provincial assembly, Finance Minister Sirajul Haq claimed that it was a deficit-free budget and the government had not levied any new taxes.

According to the document, the operational budget for maintaining the existing service delivery network was declining in real terms, while the salary and pension liabilities were rising “at an alarming rate”.

“The estimated budget for pay and pension makes up about 71pc of the total current expenditure for 2014-15, increase in salaries and pension at such a rate leaves little room for the provincial expenditures to set aside adequate funds for operation, maintenance and development sector.”

The general revenue receipts were estimated to be Rs404.8bn, inclusive of Rs227.121bn through federal tax assignment, share for the war on terror Rs27.29bn, straight transfers Rs29.26bn, GST on service (provincial) Rs12bn, provincial own receipts Rs13.93bn, net hydel profit generation Rs12bn, and hydel profit arrears Rs32. 27bn, total general capital receipts of Rs250 million coupled with total development receipts of Rs47.35bn.

The annual expenditures include a huge sum of Rs73.28bn for the general public service, Rs35.42bn for public order and safety affairs, Rs19.34bn for economic affairs, Rs20.98bn for heath (excluding health education) and Rs87.63bn for education affairs and services (including health education) besides cost of environmental protection, social protection. It also includes ADP (provincial) of Rs98.37bn, foreign projects assistance of Rs39.75bn and ADP (districts) to the tune of Rs1.67bn.

The government has increased stamp duty, which ultimately affects the prices of lands.

The taxing of professional educational institutions like medical colleges, engineering and law colleges will make education expensive.

An increase in tax on immoveable commercial property is certain to affect the purchasing power of low-income classes.

The projected allocation for elementary and secondary education is Rs73.68bn _ the biggest slice followed by Rs25.23bn for health.

A sum of Rs28.53bn has been earmarked for police, of which Rs24.15bn is meant for salaries.

DEVELOPMENT PROGRA­MME: The outlay of the Annual Development Programme is Rs139.8bn, which includes Rs39.75bn for foreign-funded projects.

The size of the provincial development programme is Rs100bn, which shows an increase of 20.5pc over the current year’s programme.

There are a total of 1,215 development schemes, including 540 new projects. The remaining 711 are ongoing projects.

The finance minister said the completion of ongoing schemes would reduce throw-forward liabilities.

But interestingly, the government could not utilise Rs118bn out of current ADP because of lack of a proper mechanism, including hiring of consultants.

The minister also presented a supplementary budget of Rs16.36bn, out of which the police got Rs5.87bn. The opposition protested over the supplementary budget and tore up copies of the budget speech.

Earlier, journalists staged a walkout over non-availability of the budget speech and other related documents.

Published in Dawn, June 15th, 2014