Centre fails to disburse subvention payment to NWFP
By Our Correspondent
PESHAWAR, Aug 26: The finance division in Islamabad has not paid heed to the NWFP government's requests vis-à-vis the payment of remaining amount of Rs1 billion the province has claimed on account of subvention for the last financial year, officials say.
In accordance with Prime Minister Shaukat Aziz's promise, the NWFP was supposed to get Rs5 billion on account of subvention during the financial year 2005-06.
After the province ended up the last fiscal, with total proceeds of Rs3.89 billion on account of subvention, it raised the matter with the federal government in July this year.
The officials said the provincial government in a letter to the federal government few weeks back made a request for the provision of remaining amount of Rs1.1 billion in fulfilment of prime minister's announcement.
The officials said the NWFP was paid Rs3.89 billion subvention, the amount it had been receiving for the last four years, whereas Balochistan was released much higher amount.
The federal government, they said, distributed a total of Rs9.4 billion between Balochistan and the NWFP as subvention during the last financial year, including Rs5.5 billion put at the disposal of the Balochistan government and the remaining Rs3.89 billion released to the NWFP.
In line with the last National Finance Commission (NFC) award (which remained enforced till June 30, 2006), Balochistan and the NWFP received special grant from the Centre to offset their under development in addition to their normal share from the federal divisible pool.
On the basis of a formula, 55 per cent of the total size of the subvention pool was diverted to Balochistan and the remaining 45 per cent to the NWFP every year.
"The federal government neither fulfilled prime minister's promise nor it paid heed to the 55:45 formula thereby funds from the subvention pool should have been distributed between Balochistan and the NWFP," said an official.
He said while the government of Balochistan was released 58.5 per cent out of the Rs9.4 billion subvention pool, NWFP's share of Rs3.89 billion came to about 41.5 per cent which was against the spirit of the previous NFC award.
"Reduced payment made to the province on account of subvention was not only in violation of its due constitutional right, but the anomaly has resulted in financial complication for the province," said a finance official. He said the provincial government had decided to make a proper representation to the federal government to remind it of the commitment made by none other than the prime minister and also to reserve its right to the remaining amount.
However, according to sources, apart from the recent request made in July, the provincial government had also written a similar letter to the federal authorities concerned much ahead of June 30, requesting them to remove the anomaly by making sure that the province was released full amount of Rs5 billion by June 30.
"None of the two letters received yielded desire results after the federal government did not take note of any of the two reminders," said the sources.
