PESHAWAR: The conflict-riddled Frontier government on Wednesday unveiled a deficit budget with a total outlay of Rs 214.181 billion and annual development programme worth Rs 51.156 billion for financial year 2009-10.
NWFP Senior Minister for Planning and Development Rahim dad Khan tabled the budgetary proposals for next financial year in the provincial assembly, which met amid extraordinary security arrangements.
The minister in his budget speech claimed that no new tax has been levied in the next budget, however, the Finance Bill 2009 contains proposals for increasing the ratio of different provincial taxes and duties including property tax besides bringing a number of new sectors into the tax net.
The new sectors to be taxed under professional tax are restaurants, professional caterers, wedding halls and charted accountant firms that is likely to spark resentment from different businesses and service providers, who are already bearing the brunt of worsening law and order situation in the province.
The provincial government anticipates collecting additional resources worth Rs 1.317 billion through increasing the ratio of different taxes and bringing more sectors into the tax net, an official privy to the development told Dawn.
The budget carries proposals of relief measures for serving and retired civil servants, internally displaced persons and creation of a Provincial Employment Fund for unemployed youth are major attractions in the new budget.
The provincial government, according to budget estimates, anticipates total revenue receipts to the tune of Rs 211.114 billion, which is almost 40 per cent higher than the revised revenue receipts of the outgoing financial year.
Against the available resources, the estimated expenditures in the next financial year have been projected at Rs 214.181 billion, showing a deficit of Rs 3.066 billion, which the minister did not elaborate on how it would be tackled in the next fiscal year.
Analysts believe the revenue shortfall of the cash-strapped province will grow further because the impact of 15 per cent pay and pension rise of the government servants have not been taken into account.
As new battlefields are being marked in the southern parts of the province, they say the financial woes of the government will grow because of another spell of mass displacement and massive mobilization of security personnel.
In the outgoing fiscal year total budget outlay was projected at Rs 170.904 billion, however, it stood at Rs 159.451 billion as per the revised estimates because of lower-than-budgeted transfers from the federal government.
The provincial government had projected the outgoing budget as surplus with Rs 345.561 million; however it ended up at a major deficit of Rs 9.149 billion.
According to budget estimates for next financial year, the total general revenue receipts of the province stand at Rs 113.688 billion, which include Rs 67.808 billion from federal divisible pool, Rs 7.549 billion as royalty on gas and oil production, Rs 2.110 billion as province share on GST on services and Rs 7.861 billion to be collected on account of sales tax for district and cantonment boards in lieu of defunct Zilla Tax.
Similarly, special grant worth Rs 14.822 billion from the federal government as determined under interim National Finance Commission (NFC) award and Rs 6 billion-capped proceeds on account of net hydel profit are also part of revenue receipts of the next financial year.
The provincial government’s own contribution to the overall resource pool will be merely three per cent, the lowest-ever, of the total revenue in the next fiscal year.
According to the budget estimates target for provincial own receipts (POR) has been set at Rs 7.537 billion, showing an increase of almost 17 per cent comparing to the recoveries of the outgoing fiscal year.
An amount of Rs 97.244 billion on account of capital and development receipts from federal and foreign lenders and donors are also part of the expected revenue in the next fiscal year.
Against the total revenue collection, an amount of Rs 80 billion would be spent on general administration, Rs 3.266 billion on debt serving, Rs 51.156 billion on development and Rs 79.757 billion on state trading, which mainly deals with procurement of wheat for the local consumption from the open market.
Of the total revenue to be spent on general administration, public order and safety affairs carries an allocation of Rs 11.487 billion, major portion of which will be consumed by the police, fighting militancy in almost 70 per cent areas of the province.
Regular budget of the police has been projected at Rs 9.677 billion in the next financial year, which almost 48 per cent higher than the estimates of outgoing fiscal year. This amount will be spent on creation of special elite force, incentive to the constables and compensation to the heirs of police personnel killed in the line of duty.
The regular budget of health and education, the two traditionally priority areas, have been slightly increased with allocation of Rs 2.989 billion and Rs 3.942 billion respectively in the next fiscal year.
The next year Annual Development Programme (ADP) carries a total outlay of Rs 51.156 billion, which is almost 31 per cent higher than the development budget of the outgoing fiscal year.
Of the total ADP, Rs 32.546 billion would be spent on uplift schemes being executed through own resources, Rs 10.050 billion on federal projects, Rs 574 billion on population welfare programme, Rs 6.644 billion on foreign funded projects and Rs 1.341 billion would be spent on uplift schemes to be executed by the district and Tehsil governments.
Referring relief measures of the budget, the minister announced setting up a Provincial Employment Fund with an allocation of Rs 500 million. This fund, he said, would be utilized for lending soft loans to unemployed youth, particularly from the rural areas.
The main areas of lending would be small cottage industry, food processing industry, small scale trading, setting up of shops and hotels and procuring tractors and auto rickshaws.
Similarly, public sector serving and retired employees have been given 15 per cent raise in salary and pension with effect from July 1st, which is going to consume Rs 3.9 billion in the next fiscal year.
All the government servants from grade 1 to 16 have been exempted from paying professional tax with effect from July 1st, while ratio of Unattractive Area Allowance for government employees, serving in Chitral and Kohistan districts have been substantially increased in the next year budget.
Every displaced woman would be given Rs 10,000 on giving birth in government camps. Similarly, the provincial government will bear one year fee and boarding expenses of the displaced college and university students from restive Malakand region, the minister added.
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