PESHAWAR: Adviser to the Khyber Pakhtunkhwa chief minister on finance Muzammil Aslam on Saturday feared that the centre would provide the province with around Rs300 billion less than the due funds in the current fiscal year.

“We [KP] are likely to face an over Rs200 billion gap in federal receipts and a Rs100 billion hit in the funds for merged tribal districts,” Mr Aslam told the post-budget news conference in the cabinet room of the civil secretariat.

He said the province was supposed to receive Rs765 billion in federal tax receipts, but the centre was likely to provide it with Rs750 billion.

The aide to the CM also said KP faced a shortage of Rs2 billion under one per cent of the federal divisible pool under the head of war on terrorism, while there was a little likelihood of the province receiving over Rs91 billion in windfall levy.

CM aide says despite financial issues, no compromise on govt’s social welfare commitments

“We’re supposed to receive Rs32 billion under the net hydel profit but got our last tranche in October last year. Similarly, the federal government hasn’t paid us Rs53 billion in hydel profit arrears,” he said.

Mr Aslam said the salary expenditure of tribal districts was Rs60 billion at the time of the region’s merger with KP in 2018, and regrettably, the centre didn’t increase it afterwards.

He said salaries of government employees were increased every year, with the last year witnessing a pay raise of 35 per cent.

The chief minister’s adviser said currently, the salary budget of tribal districts had been pitched at Rs96 billion, while the federal government had allocated just Rs66 billion under that head. He said the other operational expenses were in addition to that amount.

“The merged areas total expenditures are pitched at Rs116 billion for the current fiscal,” he said.

Mr Aslam said in the last fiscal, the federal government released Rs60 billion for tribal districts, though the actual expenses stood at Rs73 billion and therefore, that bill was footed by the province.

He said that the federal government also released Rs41 billion for the Accelerated Implementation Programme for tribal districts against the project allocation of Rs67 billion.

“The centre promised to pay Rs100 billion per annum to us for 10 years to bring tribal districts on a par with the rest of the country, but that hasn’t happened yet,” he said.

The chief minister’s adviser wondered if the federal government could reduce the share of Punjab and Sindh provinces in national resources in the same manner.

“Despite facing financial constraints, we [KP] has given a surplus of over Rs96 billion to meet our targets under the International Monetary Fund’s agreement. We do not want to embarrass the federal government,” he said.

Mr Aslam said amid the economic crisis, the Federal Board of Revenue’s tax collection was very good.

“The FBR has done a good job on the tax collection front,” he said.

The CM’s aide said salary, pension, and non-salary expenditures amounted to a large portion of the province’s budget.

“Our salary and pension expenses total Rs650 billion and over Rs250 billion non-salary expenditures are in addition to it,” he said.

Mr Aslam said despite facing financial issues, the provincial government didn’t make any compromises on its social welfare commitments and spent Rs10 billion under the head of welfare.

He said the government also released Rs8 billion under the Ehsas welfare programme and would release Rs2 billion for it next month.

“We have also released over Rs14 billion for the purchase of wheat,” he said.

The CM’s adviser said the planning and development department was undertaking an exercise to shelve the projects started under political consideration and work on which had yet to start.

“This will result in a reduction in throw-forward liability,” he said.

Published in Dawn, May 12th, 2024

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Military option
Updated 21 Nov, 2024

Military option

While restoring peace is essential, addressing Balochistan’s socioeconomic deprivation is equally important.
HIV/AIDS disaster
21 Nov, 2024

HIV/AIDS disaster

A TORTUROUS sense of déjà vu is attached to the latest health fiasco at Multan’s Nishtar Hospital. The largest...
Dubious pardon
21 Nov, 2024

Dubious pardon

IT is disturbing how a crime as grave as custodial death has culminated in an out-of-court ‘settlement’. The...
Islamabad protest
Updated 20 Nov, 2024

Islamabad protest

As Nov 24 draws nearer, both the PTI and the Islamabad administration must remain wary and keep within the limits of reason and the law.
PIA uncertainty
20 Nov, 2024

PIA uncertainty

THE failed attempt to privatise the national flag carrier late last month has led to a fierce debate around the...
T20 disappointment
20 Nov, 2024

T20 disappointment

AFTER experiencing the historic high of the One-day International series triumph against Australia, Pakistan came...