Provincial utilisation of uplift funds remains low during FY 2019-2

ISLAMABAD: The provincial utilisation of allocated development funds has remained dismally low during the outgoing financial year 2019-20 as un-utilised funds stood at over 40 percent, it is learnt.

The provinces have utilised development funds of Rs540 billion in outgoing financial year against allocated amount of Rs912 billion. It indicates that the utilisation remained less than 60 percent so un-utilised funds have risen to over 40 percent. The utilisation of development funding has remained dismally low in last two years under the dispensation of PTI-led regime. The provincial authorities always blamed the Center on account of flawed budgeting and lower utilisation of development funds because they argued that they had never obtained their share in accordance with commitment made by the federal government on eve of every budget. When the FBR’s collection decreased then the provinces share into NFC also reduced significantly.

On other hand, the utilisation of funds at federal level through Public Sector Development Programme (PSDP) also remained stagnant in last two years. The federal PSDP utilisation is projected to touch Rs530 billion in outgoing fiscal year against allocated funds of Rs701 billion, indicating that utilisation might touch 75.6 percent for the current fiscal year.

The Ministry of Planning has informed to the National Economic Council (NEC) which is scheduled to be held under chairmanship of PM Imran Khan here on Wednesday (today) that the pace of development expenditure showed a mixed trend.

It improved during first two quarters of current financial year as compared with same period the last year. This trend continued up to February, 2020. However, there was sharp decline in the development expenditure during March–April not only with reference to previous two years but also during the CFY i.e. Rs69 billion on an average was reported as expenditure during December, 2019 to February, 2020.

For instance, the incurred expenditure during February, 2020 was Rs106 billion. Against this, expenditure during March/May, 2020 was Rs112 billion. In rupee terms, utilisation during March – May period also dropped from Rs249 billion in last financial year 2018-19 to Rs112 billion in CFY due to COVID-19 situation.

As a result, 149 projects costing Rs827 billion are completed/likely to be completed against expected 200 projects estimated at the beginning of the year 2019-20. The NEC approved PSDP 2019-20 in its meeting held on May 29, 2019. The PSDP 2019-20 document was placed before the Parliament. However, in line with government’s policy to make targeted interventions in the less developed districts of Balochistan, additional 53 projects mainly water and power were included in the PSDP 2019-20 document. The document of PSDP 2019-20 was published and presented to the Parliament on June 26, 2019 which was voted/approved along with budget 2019-20 (Annex-III). In addition, exercising the authorisation granted by NEC to make adjustments in the PSDP 2019-20, the Ministry of Planning during the financial year, allowed inter and intra sectoral re-appropriations including additional projects to the tune of Rs136 billion to 148 projects primarily to fast track projects implementation/completion.

The project-wise data of release and foreign aid disbursement was regularly uploaded on the website of Planning Commission on weekly basis. Up to May 31, 2020, funds to the tune of Rs661 billion against allocation of Rs701 billion (94% of allocation) have been authorised / disbursed which shows that despite COVID-19 pandemic and financial pressure for government to extend financial support (cash subsidies) to affected societies/families, the flow of PSDP funds was on track without any cut to reach executing agencies so as to continue development activities not only for timely completion of projects but also provide jobs to daily workers.