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PFC Award 2017 may be delayed, linked to census outcome

By Jawwad Rizvi
July 22, 2017

LAHORE: Provincial Finance Commission Award 2017 is also attached with the outcome of the census results as the required data and information for distribution of the resources among the districts could not be objectified without authentic population data.

The PFC Award 2017 might be delayed and turned into PFC Award 2018 due to the results of the Census 2017. The districts will get resources on the basis of existing Interim PFC Award 2017 for the first two quarters of the ongoing fiscal year 2017-18.

Provincial Minister for Finance Dr Ayesha Ghaus Pasha talking to The News confirmed that data plays vital role in policy making while the government also faced number of issues while awarding Interim PFC Award 2017. “We have started working on PFC Award 2017 and a technical committee headed by MPA Makhdoom Hashim Jawan Bakht and comprising Dr Waseem, secretary finance, secretary local government, secretary education, secretary health, technical members Faisal Rasheed and Ali Cheema, has been formed for reconstitution of formula”, she said. However, the committee has instructed to keep provision of changes in the light of Census 2017 results.

"We faced lack of verifiable and correct data in Interim PFC Award 2017 which affects the thorough analysis and limits the policy making. The census data will clear the picture. This will be helpful in evolving a good comprehensive PFC Award 2017 which will cover social sector spending and allocation of resources in a better way”, the minister believed.

Existing Interim PFC Award 2017 which was evolved around District Education Authorities (DEAs), District Health Authorities (DHAs), need of population, school going children, fertility and rate of poverty.

The distribution of the resources among DEAs is based on the ratio of district variables of inverse population density, school-going-age children in the population, poverty rate, girls’ middle class enrolment, and out-of-school children to the respective provincial figures.

The distribution of resources to the DHAs is based on the ratio of district variables of inverse population density, share of population less than nine-year old and greater than 65-year old, share of women population aged between 15 to 49 and poverty rate to the provincial averages.

These are the basic information around which PFC Award formula is evolved. However, actual population size of the province is not available at the time of the formulation of the Interim PFC Award 2017. The population of the Punjab was around 78 million according to 1998 census. The government allocates and distributes the resources on the basis of estimation by adding annual population growth rate to 1998 census data which estimated around 100 million people.

But census department officials expected that the Punjab population is likely to exceed 130 million on the basis of the census conducted this year. They said more than expectations facts about the population of the province were revealed during the census. In such situation, apprehensions of the Punjab finance minister for awarding the PFC Award 2017 on existing population data are correct. The Punjab government should wait for the results of Census 2017 for better policy making and planning, they observed. According to the Interim PFC Award 2017, the formula of calculating the share of distribution of resources among metropolitan corporations, municipal corporations, municipal committees and district councils is based on the ratio of district figures of inverse population density, poverty rate, and share of population without access to improved drinking water sources on premises to the provincial figures. The share of district council in General Purpose Grant for municipal corporations, municipal committees, and district council was decided to be equal to half of the share of rural population in the district. The balance of the General Purpose Grant is divided among the municipal committees and municipal corporations on the basis of their share in the number of union councils/wards in the district.

All the formulation is mainly based on population. Once the population numbers will change the resources allocation will also move accordingly.

The share of DEAs, DHAs, metropolitan corporations, municipal corporations, municipal committees and district council in the existing formula based component of provincial allocated amount is DEAs 66.9 percent, DHAs 16 percent, metropolitan corporations, municipal corporations, municipal committees, and district councils 12.8 percent and union councils 4.3 percent. Each union council will get Rs3.6 million annually.

The Punjab government has allocated Rs368 billion under PFC Award for the fiscal year 2017-18. Out of Rs368 billion, Rs227 billion are allocated for the DEAs, Rs73 billion for DHAs, Rs57 billion for metropolitan corporations, municipal corporations, municipal committees, and district councils which further divided into development grants is Rs14 billion and Rs43 billion for non-development expenditures and Rs14.5 billion for the union councils.

Once the increased population numbers will be released by the Pakistan Bureau of Statistics in the light of outcome of the Census 2017 will change the electoral constituency’s limits as well as increase the number of union councils and other bifurcations of metropolitan corporations, municipal corporations, municipal committees, and district councils. Hence a comprehensive revamping of planning will require.

Provincial finance minister believed that due to limited resources of provincial governments, it is necessary that local governments should increase their own resources and pay attention to resource mobilisation. “We have assured the members of the PFC that the room of change will be kept in the award in case of change in facts and figures, needs and results of recent census”, the minister said.

The officials involved in the constitution of the PFC Award 2017 also apprehended delay in formulation in PFC Award 2017. They foresee delay until next year which will turn it into PFC Award 2018.