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Tuesday March 19, 2024

Provinces to get Rs2.38tr in new fiscal

By our correspondents
May 27, 2017

ISLAMABAD: The provinces will get Rs2.38 trillion in the new fiscal year of 2017-18 from their share in federal revenues, showing an increase of about around 12.4 percent from the outgoing fiscal.

After transfer to provincial governments, the net revenue of the federal government is estimated at Rs2.92 trillion in 2017-18 as compared to revised estimates of Rs2.61 trillion in the current financial year.

While presenting the budget proposals for 2017-18, Finance Minister Ishaq Dar said out of the total revenues, the provincial governments’ share is estimated to be Rs2,384 billion as compared to Rs2,121 billion revised estimates for 2016-17, showing an increase of about around 12.4 percent. “These resources will be utilised by the provincial governments in enhancing human development and security of the people,” he said.

The federal government recognises that the provincial governments have increased responsibilities of social sector services delivery under the new arrangements, therefore, the Centre is constantly raising the level of provincial transfers to enable them to improve social services and law and order.

In accordance with the framework for distribution of resources structured by the 7th NFC Award, the net transfers to the provinces are Rs2.531 trillion in the budget estimates 2017-18 and these transfers were estimated at Rs2.21 trillion in the budget estimates of 2017-18 and Rs2.17 trillion in revised estimates 2016-17.

Punjab will get Rs1.16 trillion, Sindh Rs612 billion, Khyber-Pakhtunkhwa Rs389.854 billion (including one percent for war on terror) and Balochistan Rs219 billion in 2017-18. In the outgoing fiscal year 2016-17, Punjab was allocated Rs1.04 trillion, but its revised estimates were Rs1.02 trillion, Sindh was allocated Rs527.841 billion, yet in the revised estimates for the ongoing fiscal year their allocation will be 554.111 billion, KP was allocated Rs346.194 billion for the fiscal year 2017-18, but in revised estimates, they will get Rs343.547 billion and Balochistan was allocated Rs203.594 billion.

The provinces agreed sharing divisible pool under the National Finance Commission (NFC) Award that will take place on the basis of 82 percent population, 10.3 percent poverty and backwardness, five percent on revenue collection/generation and 2.7 percent on inverse population density. One percent of the net proceeds of the divisible pool would be assigned to the government of KP to meet the expenses on the war on terror.

The Federal Budget  2017-18 document also revealed that according to the Seventh NFC Award, the provinces would be transferred Rs2,384.243 billion from the federal divisible pool of taxes against the revised transfer of Rs2,121.347  billion of the ongoing fiscal year.