PESHAWAR: The Khyber Pakhtunkhwa government has launched the budget performance criteria to jack up the funds utilization that is presently just 17 percent in the districts and 50 percent at the provincial level during the first two quarters (July 1 to December 2) of the current fiscal (2017-18).
Faced with low and ambiguous utilization of the development funds, the Finance Department has launched the budget performance criteria to boost development expenditures and bring transparency to the uplift and other spending.
Like all previous years, the issue of low utilization by the provincial departments and district governments continued in the first two quarters of the final financial year.
The China Pakistan Economic Corridor (CPEC) and Chinese investment projects were among the four projects and departments that could not spend a single penny of the funds released over the last two quarters of the current financial year, according to the document of the Finance Department that was shared with The News.
The provincial government is supposed to spend Rs208 billion on development projects in the current fiscal. From July to December it released Rs67.993 billion to the departments and districts for development projects. The actual expenditures during this period was Rs31.83 billion, which comes to 32.68 percent of the total estimated development budget and 46.8 percent of the total releases in the two quarters.
The budget performance criteria has been launched by the Finance Department as part of the efforts of the new bureaucratic team headed by Chief Secretary Muhammad Azam Khan since September last to cope with the issue of the low utilization.
It is aimed at increasing the utilization of funds on the one hand and making the process transparent at the other, Finance Secretary Shakeel Qadir told The News.
He said the introduction of the new local government system has changed the dynamics of the financial management. The Finance Department had earlier no real-time data on the funds utilization by the districts, Shakeel Qadir added.
Apart from the pension liabilities, the district governments presently get both the current and development allocations of Rs175 billion, he said, adding that these fledgling local bodies institutions have their own dynamics and limitations to spend the amount.
“We have moved towards performance based releases or performance budgeting when it comes to the allocation, releases and utilization of the funds to the districts and departments,” he pointed out. “We have asked the district governments and departments to come up with 60 percent utilization to get the next tranche of the development funds,” Shakeel Qadir explained.
Citing the benefits of initiating the budget performance criteria, he said it saved public exchequer from underperformance on the one hand and improved the funds utilization capacity at the provincial and districts level on the other.
The Finance Department document showed that the district governments received Rs2.74 billion of their total share of Rs28 billion in the Annual Development Programme (ADP) during the last six months.
However, the three tiers of the local government could spend R477.75 million only. It came to 9.80 percent of the total estimated budget and 17 percent of the funds released.
The provincial government has its own ADP of Rs98 billion and from this it has released Rs59.23 billion. In the last six months of the fiscal, the expenditures pitched at Rs29.59 billion forming 50 percent of the amount released to the government departments.
Besides, only 6 percent releases could be initiated for the Foreign Project Assistance (FPA) of which 29 percent could be spent on these projects so far. Also, no amount has been released for the Public Sector Development Projects (PSDP) in the province.
The document indicated that none of the CPEC-related and Chinese investment projects, the pro-poor special initiatives of the provincial government and its Housing and Labour departments could spent a single penny of the funds released to them for July to December.