• Proposes up to 30pc salary hike for govt employees, pensions to rise 15pc
• Minimum wage to increase from Rs35,500 to Rs37,000 per month
• Rs959bn goes to development projects; education gets Rs454bn, health Rs300bn

KARACHI: The PPP government in Sindh on Friday presented a Rs3.056 trillion balanced budget for the next fiscal year, proposing a salary hike of up to 30 per cent for provincial government employees and allocating around a third of the total outlay, or Rs959 billion, for development expenses.

In percentage terms, the development budget for the next year is almost equal to the current year’s estimates of Rs735bn, though the provincial government has ended up spending a far lower amount, Rs529.6bn, under this head.

Chief Minister Syed Murad Ali Shah, who has also held the Sindh finance minister portfolio for over a decade, termed it a “record balanced budget” during his over an hour-long speech, which went smoothly without facing any uproar from the opposition.

The opposition, led by Muttahida Qaumi Movement Pakistan (MQM-P) Leader Ali Khursheedi, attended the entire session without putting up any resistance.

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The budget estimates for the next fiscal year mainly focus on rehabilitating flood-affected people and providing social protection for the poor.

At Rs3.056tr, the province’s total projected revenue and expenditure are exactly equal, showing no budget deficit or surplus. The federal government, in its budget announced earlier this week, expects the provinces to deliver a surplus of Rs1.217tr in the coming fiscal year.

Most of Sindh’s revenues, or 62pc, is expected to come from federal transfers, followed by 22pc from provincial receipts.

The remaining revenue will come from current capital receipts of Rs21.6bn, foreign project assistance of Rs334bn, federal gra­nts in the form of PSDP of Rs77bn, foreign grants of Rs6bn, and a carryover cash balance of Rs55bn.

Shah also announced a proposal to raise the minimum wage from Rs35,500 to Rs37,000 and increase salaries by up to 30pc and pensions by 15pc.

“The government of Sindh has proposed a hefty 30pc increase in the salary of employees of grades 1 to 6,” the chief minister said.

He also introduced a personal allowance for these employees to align their monthly salary with the minimum wage of Rs37,000. For employees in grades 7 to 16, a 25pc increase was proposed, and for grades 17 and above, a 22pc increase.

“We have also proposed a 15pc increase in the pension of retired employees,” he added.

Revenue receipts

The total receipts are divided into five categories: current revenue receipts of Rs2.56tr, current capital receipts of Rs21.62bn, other receipts of Rs416.92bn, and carryover cash balance of Rs55bn.

The current revenue receipts include Rs1.9tr of federal transfers in the form of revenue assignment (Rs1.75 trillion), straight transfers (Rs106.415bn) and grants of Rs46.98bn to offset losses due to the abolished octroi and zila tax.

The current revenue receipts also include Rs268.9bn provincial tax receipts, Rs350bn provincial sales tax on services, and Rs42.9bn provincial non-tax receipts.

As for the current capital receipts, Rs6.7bn goes to local repayments and loans and Rs14.9bn to bank borrowing. The “other receipts” head eyes foreign project assistance (FPA) of Rs334bn, “other federal grants” of Rs76.9bn and foreign grants of Rs5.9bn.

Expenditures

The estimated total expenditure includes a current revenue expenditure of Rs1.91tr, current capital exp­enditure of Rs184.8bn and development expenditure of Rs959bn.

The development expenditure includes the provincial annual deve­lo­pment plan (ADP) of Rs493bn, foreign project assistance of Rs334bn, other federal grants of Rs76.9bn and district ADP of Rs55bn.

The CM said the education sector’s budgetary provision has been proposed to be Rs454bn against last year’s budget of Rs334bn.

He said the provision of funds for the Sindh Higher Education Commission is Rs34.5bn against last year’s budget of Rs23bn, an increase of around 50pc.

CM Shah also announced a 32pc increase in the health sector’s budget to Rs300bn against Rs227.8bn last year, claiming that the Sindh government “takes pride in having the best tertiary healthcare system in the country”.

He said the Jinnah Postgraduate Medical Centre (JPMC), National Institute of Child Health (NICH), and National Institute of Cardiovascular Diseases (NICVD) combined now have 4,000 beds.

For transport and commutation, the Sindh government has allocated Rs7.62bn for the next fiscal year.

Published in Dawn, June 15th, 2024