Monday 22 July 2019
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KP presents Rs900 bn budget with development outlay of Rs236 bn

PESHAWAR: Khyber Pakhtunkhwa Finance Minister Taimoor Saleem Khan Jhagra on Tuesday presented what he called a historic budget for the new larger Pakhtunkhwa of Rs900 billion at the provincial assembly with the development outlay of Rs236 billion for the financial year 2019-20.The budget envisages a surplus revenue of Rs45 billion, projecting over all expenditures of Rs855 billion against its annual receipts.The KP government proposed 10 percent ad-hoc relief allowance on running basic pay for all provincial government employees from BPS-1 to 16 and five percent ad-hoc relief allowance for all employees in BPS-17 to 19 on running basic pay which would not be admissible to the employees drawing the health professional allowance, special judicial allowance, scheduled post allowance, technical allowance, prison allowance and prosecution allowance.The salaries of the chief minister and cabinet members have been reduced by 12 percent while 10 percent increase has granted in pension to all pensioners and the minimum wage has been increased to Rs17,500.The articulate and young provincial finance minister began his budget speech amid uproar, protest and subsequent boycott by the opposition members who were raising anti-government and anti-prime minister slogans. However, it failed to distract the finance minister who was presenting his second budget. It was the seventh budget of the Pakistan Tehreek-e-Insaf (PTI) government in the province.Speaker Mushtaq Ahmed Ghani presided over the assembly session. The finance minister at the very outset put five salient features that he said would better define the budget. He explained that they managed to successfully control government expenditures and raised revenues to stand up on their own feet.Besides, he said they kept their commitment to bring a historic package for the merged tribal districts. Unlike the past traditions, the minister did not dilate upon the performance of the government during the outgoing financial year, but straightaway turned to the details of the budgetary plan chalked out for the next fiscal year. Budget speeches are not what change the countries. Action does. So I want to get straight to the point, he remarked.In this country, he said, change has been but a word. As a famous author said, everyone thinks of changing the world, but no one thinks of changing himself. We will start with ourselves, the minister remarked.He said the federal ministers salaries were reduced by 10 percent while Chief Minister Mahmood Khan and his cabinet decided to reduce their salary by 12 percent. When it comes to sacrifice for Pakistan, this province and its leadership will be one step ahead. Senior civil and public servants of grade 22, 21 and 20 serving in the provincial government will forego any increase in salary, he added.However, he pointed out that five percent increase would be given to all other civil and public servants in grade 17, 18 and 19 as ad-hoc relief allowance and a 10 increase to all civil and public servants in grade 16 and below, also as ad-hoc relief allowance. Of the Rs900 billion budget, Rs693 billion have been allocated to be spent in the settled districts and Rs162 billion in the newly-merged districts showing Rs45 billion as a surplus, he said. We are allocating a record Rs319 billion as development outlay which is only 8.9 percent lower than Punjab s Rs350 billion and Rs34 billion greater than Sindh s Rs285 billion, Taimoor Jhagra said. He added that a huge amount of Rs236 billion has been allocated for the settled districts and Rs83 billion would go to the development schemes in the merged tribal districts. He claimed both amounts are record high for the province.He said the KP government would spend Rs256.0 billion to pay salaries, Rs69.9 billion for pensions, Rs93.5 billion on Non-salary (O M and Contingency and District Non-Salary), Rs108.0 billion for the Provincial Annual Development Programme (ADP), Rs46.0 billion for the district ADP, Rs82.0 billion for the projects under foreign development assistance and Rs37.6 billion for other projects.About the receipts, Taimoor Jhagra said the province would receive Rs453.2 billion as Federal Tax Assignments and Rs54.5 billion as its one percent share of the divisible pool for its suffering as a result of the war on terror.He said the province would receive straight transfers such as Rs25.6 billion as oil and gas royalties and surcharges, an estimated Rs21.2 billion as Net Hydel Profit (NHP) and Rs34.5 billion as NHP arrears carried over the last year in accordance with the AGN Kazi formula.The province from its revenue resources including provincial tax and non-tax revenue would receive Rs53.4 billion while Rs82 billion would come as Foreign Project Assistance (FPA). A grant of Rs151 billion would be received for merged districts while Rs24.7 billion would come from other sources during the next financial year.Dilating further upon the salient features of the budget, the finance minister said the provincial government had strived to reduce cost of government and conducted a detailed expenditure review of every department to assess as to where costs could be cut without impinging on the service delivery. He said an additional Rs95 billion were made available for development through this extensive exercise.He said the cabinet has approved a proposal to change the mandatory retirement age to 63 and early retirement to 25 years of service or 55 years of age, whichever comes later to save around Rs20-plus billion a year.He insisted it would not reduce job opportunities for the youth in the province as the government was planning to recruit around 30,000 individuals in the settled districts and over 17,000 in the tribal districts over the next year.The additional money saved would have the potential to create 40,000 to 50,000 jobs in the private sector in the next year alone, he argued. Taimoor Jhagra said the provincial government is broadening the tax base to raise revenue as no country can develop without generating resources to fund its development. He added that in the wake of reforms the revenues of the Khyber Pakhtunkhwa Revenue Authority (KPRA) over the last 11 months (non-telecom) increased by 49 percent which will double next year to reach the Rs53.4 billion slab. In KPRA, we are now placing 28 out of the 58 taxable services at a reduced tax rate of below 15 percent versus nine today. These include restaurants, wedding halls, electronic media, property dealers, automobile dealers, rent-a-car businesses, contract manufacturing, legal and medical services as well as other professional services, cinematographic services, photographers, broadcasting figures, call centres, amusement and entertainment services, beauty parlours and gyms among others, the minister said. In particular, we are reducing the tax rate on ride hailing services to two percent, and on online marketplace services to five percent, because we believe that these will go a long way toward job creation for the youth, he maintained.The minister said that the KP would be the first province to expand Sehat Cards to every family in the province by the end of the year while government servants would also have the option of subscribing to state-of-the-art medical programmes through the initiative.He explained that the government would spend over Rs7 billion across the current and development budgets for the enhancement of facilities at tertiary care hospitals including the Peshawar Institute of Cardiology, KTH, LRH, HMC, Institute of Kidney Diseases, Saidu Hospital, Fountain House Peshawar and others. The government is improving 28,000 schools and recruiting 21,000 teachers to address multi-grade teaching. About 65,000 teachers are required to make four teachers in every school. About 3,000 new ASDOs would be the recruited to improve school leadership, he said.The government, he said, would launch Pakhtunkhwa da Para programme to put graduates from the top universities into government schools. He said for promoting Green Growth, Rs2.8 billion has been allocated as part of the Billion Tree Tsunami project in the province, Rs195m for Development and Management of National Parks, revamping agriculture, livestock and addressing water issues. He added that over Rs2.5 billion were allocated for various schemes under the Prime Minister Agriculture Emergency programme to increase productivity, conserve more water, develop cultivable areas and promote organic lifestyle. He said Rs9.5 billion has been allocated for the construction and improvement of small dams, flood protection walls, water supply schemes and canal roads throughout the settled districts.


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