Rs2,026 bn Punjab budget: Loans for farmers, Sehat Card, health insurance

LAHORE: Punjab Finance Minister Makhdom Hashim Jawan Bakht on Tuesday presented Rs 2,026 billion budget, curtailing the development allocation to Rs238 billion to ensure a surplus of Rs147.8 billion at the federal government’s request.

The revised development budget for 2017-18 was Rs579 billion that was Rs 341 billion higher than this year. The decline in development expenditure, according to the executive summary of white paper on Budget 2018-19, was inevitable because the current expenditure of Punjab government increased sharply in 2018-19. On top of that, the Punjab government accepted the direction of the federal government to ensure a budget surplus of Rs147.8 billion so that the federal deficit could be contained.

It may be mentioned that this request was made to other provinces as well. It is unlikely that Balochistan and Sindh would accede to this request as these provinces are ruled by other parties. The first budget was devoid of many public appeasing schemes like the laptops for students, taxis for youth or subsidised tractors for farmers.

The Punjab government would get Rs1,276.3 billion as its share from the federal divisible pool and Rs25 billion as federal transfers. This amount would hardly cover the current expenditure of Rs1,264.49 billion. This means that the province would have to create its own resources for development. According to the Punjab finance minister, the province would be able generate Rs276 billion from provincial taxes and Rs100 billion as non-tax revenue.

The major current expenditure of Rs520 billion will be consumed in salaries and pensions – salaries Rs313 billion and pensions Rs207 billion. Local government have been allocated Rs 438 billion. For service delivery, an allocation of Rs305 bn has been made.

The provincial government has allocated Rs373 billion for education. For clean water programme, an amount of Rs 20 billion has been earmarked from the Annual Development Programme.

Agricultural allocation has been enhanced from Rs81.3 billion to Rs 93 billion. The government has allocated Rs15 billion for the disbursement of 250,000 interest-free loans to farmers. For irrigation, the total allocation is Rs19.50 billion out of which Rs 6 billion have been earmarked for the Dadhocha Dam that would supply pure water to the twin cities of Rawalpindi and Islamabad.

The PTI government has reserved Rs149 billion for infrastructure out of which Rs68 billion would be spent on road sector and Rs 35.5 billion for transport. For the Orange Line Metro Train, an amount of Rs 33 billion has been allocated.

The provincial finance minister said that the PTI government would involve the private sector to construct highways under public-private partnership. To address environmental pollution issue, an Environment Endowment Fund worth Rs 6.3 billion is being formed.

In the health sector, the PTI government has decided to introduce the Sehat Card and insurance initiatives. The government intends to start Entrepreneurial Development Programme worth Rs 6 billion for SMEs. Another amount of Rs 4 billion has been earmarked for supporting the SMEs under public-private partnership concept. The Punjab Small Industries Corporation would conduct this exercise.

Bakht said that all Punjab departments had been instructed to improve their efficiency and rationalise non-development expenses. In addition, they have been asked to explore all avenues to increase government income.

He said the Punjab government intended to add Rs16 billion in its revenues through resource mobilization. He revealed that a saving of Rs80 billion had been achieved through expenditure rationalisation, thus adding Rs 96 billion new resources.