PESHAWAR, June 18: The NWFP Provincial Finance Commission (PFC), has evolved formula for the distribution of resources among the district governments and prepared guidelines for criteria and priorities to carry out development activities, sources told Dawn here on Tuesday.
“Major devolution would take effect from the start of the next financial year,” said one of the members of the commission.
The PFC award, to take effect from July 1, 2002, would be for a period of three years, and the six-member commission would analyse the performance of the new financial system periodically to remove the complexities and problems, if any.
The commission, said the member on request of anonymity, discussed and reviewed different options for evolving a suitable formula for the distribution of resources among the district governments, the quantum of resources to be put at the disposal of the newly formed district governments, diversion of funds for meeting the current expenditure and development needs of each of the district government, criteria for selecting development projects and priorities for focusing the development process in all the districts.
The resource distribution formula has been designed so that apart from meeting the current expenditure requirements of every district, the development needs of all the administrative units would also be taken care of by diverting majority development funds from the provincial government to the district governments.
“Bulk of the development funds would be placed with the district governments,” said the member refusing to divulge the exact proportionate of development funds to be placed with the district governments under the PFC award — to be announced by the provincial finance minister in his budget speech.
However, according to him, after meeting the current expenditure requirements, every district government would have ample funds to spend on development activities.
The resource distribution formula, said another member of the commission, who also requested anonymity, had been evolved on the basis of district governments’ needs in respect of current expenditure.
Apart from meeting the current expenditure requirements of the district governments, population, infrastructure and social and economic indicators of each of the district have also been given weightage in terms of making overall distribution of resources among the district governments.
“This would leave ample funds for development activities apart from meeting the current expenditure requirements of the district governments,” said the member.
In addition to deciding the resource distribution formula, the PFC also chalked out guidelines for the district governments to carry out development activities.
The newly formed district governments, said the PFC member, would spend development funds in accordance with a set framework.
National policies would make priority for the purpose of focusing development activities in districts.
“This has been done to ensure that any of the district governments should not deviate from the measures taken at the national level on any specific issue for example literacy, infrastructure development, skill development in education, etc.,” said the member.