PESHAWAR, Aug 9: Differences have emerged between the NWFP finance department and district governments over the allocation of developmental funds to social and non-social sectors, an official said.

Sources said that the finance department had recently sent a circular to all the district planning officers (DPOs) asking them to allocate 70 per cent of their total Annual Development Programme (ADP) funds for social sectors, particularly to the health and education sectors, while the rest for non-social sectors.

The sources said that it was a pre-condition of structural adjustment credit (SAC), a budgetary support for the government sector reforms by the World Bank that the district governments would allocate 70 per cent of their social sector development budget to health and education sectors.

But most of the district governments had expressed their reluctance to do so through their correspondence with the finance department. The district governments had argued that being elected bodies, they would utilize their funds according to their own needs and priorities, sources said.

Likewise, the sources added that one-and-a-half months had passed, but the district government had not prepared their annual development programme (ADP) so far.

In this connection, a high-level meeting was held here on Thursday at the Civil Secretariat which took stock of the situation. The meeting was attended by all the DPOs and officials of planning and finance departments.

In the course of the meeting, most of the DPOs informed the high officials of the province that their respective district governments want to utilize their developmental projects mostly on the betterment of the water supply and sewerage system and therefore they could not allocate fund to health and education sectors, sources added.

The finance department has taken exception to the non- allocation of funds to the health and education sector by the district governments in the last fiscal year of 2002-3. There was not a single new project in education and health sector of all the district ADPs last year. Not only that, but some of the districts, including Shangla and Kohat had not finalized their ADPs by the end of the same financial year.

It is pertinent to mention here that the World Bank has recently suspended the release of $90 millions second instalment of SAC for poor utilization of developmental funds by the departments and non-achieving the targets set for the reforms of government sector departments.

Sources said that all the districts were required to allocate 70 per cent of its total budgetary outlay for health and education sectors in the fulfilment of the WB’s conditions.