NFC award: Govt to dole out Rs2.6b to provinces

[Edevelop]

ISLAMABAD: The government on Monday announced that it would dole out Rs2.6 billion among the provinces for maintaining cash surplus during the first quarter of the current fiscal year that helped finance burgeoning federal expenditures.

The announcement was made by Finance Minister Ishaq Dar during the second bi-annual meeting of the National Finance Commission (NFC), convened to review implementation on the 7th NFC Award for the period of January-June of last fiscal year.

The biggest share of Rs2.6 billion federal award went to Khyber-Pakhtunkhwa (K-P) and Punjab provinces, as both federating units preferred to transfer their accumulated surpluses to the centre rather than spending on cash-strapped education, health care and infrastructure projects.

According to a statement issued by the finance ministry, the payments were doled out as an incentive for provinces for maintaining surpluses during July-September.

It added that the Council of Common Interests (CCI) – the highest inter-provincial constitutional body, had allowed paying an interest rate equal to three-month treasury papers to the provinces as a reward for saving the funds.

Out of the Rs2.6 billion allocated for the provincial award, K-P secured Rs1.1 billion, while Punjab received roughly Rs1 billion, Balochistan Rs533.7 million and Sindh secured Rs18.1 million.

In the first quarter, Punjab saved Rs32.6 billion, Sindh Rs9.3 billion, K-P Rs3.6 billion and Balochistan Rs11.6 billion, according to a summary of fiscal operations of finance ministry.

Critics, however, argue that rewards linked with savings would discourage the provinces from spending on development schemes. They added that it also goes against the principle of provincial surplus -a sum that province saves and helps to reduce the overall national deficit. Paying interest rate on savings will convert it into borrowings, they added.

According to the report, FBR claimed that it had collected Rs 2.254 trillion in taxes during the FY 2013-14. Out of this amount, Punjab received Rs 645.8 billion, Sindh Rs384.6 billion, K-P Rs232 billion and Balochistan Rs137.9 billion on account of share in the divisible pool and royalties and grants provided to the provinces.

Speaking to The Express Tribune, Haji Adeel, K-P government’s technical member of the NFC, complained that the centre was not transferring the province’s due share on account of net hydel profit.

NFC award: Govt to dole out Rs2.6b to provinces – The Express Tribune

and then PTI walas say Federal Govt is ignoring KP Govt...

 

[BetterPakistan]

ISLAMABAD: The government on Monday announced that it would dole out Rs2.6 billion among the provinces for maintaining cash surplus during the first quarter of the current fiscal year that helped finance burgeoning federal expenditures.

The announcement was made by Finance Minister Ishaq Dar during the second bi-annual meeting of the National Finance Commission (NFC), convened to review implementation on the 7th NFC Award for the period of January-June of last fiscal year.

The biggest share of Rs2.6 billion federal award went to Khyber-Pakhtunkhwa (K-P) and Punjab provinces, as both federating units preferred to transfer their accumulated surpluses to the centre rather than spending on cash-strapped education, health care and infrastructure projects.

According to a statement issued by the finance ministry, the payments were doled out as an incentive for provinces for maintaining surpluses during July-September.

It added that the Council of Common Interests (CCI) – the highest inter-provincial constitutional body, had allowed paying an interest rate equal to three-month treasury papers to the provinces as a reward for saving the funds.

Out of the Rs2.6 billion allocated for the provincial award, K-P secured Rs1.1 billion, while Punjab received roughly Rs1 billion, Balochistan Rs533.7 million and Sindh secured Rs18.1 million.

In the first quarter, Punjab saved Rs32.6 billion, Sindh Rs9.3 billion, K-P Rs3.6 billion and Balochistan Rs11.6 billion, according to a summary of fiscal operations of finance ministry.

Critics, however, argue that rewards linked with savings would discourage the provinces from spending on development schemes. They added that it also goes against the principle of provincial surplus -a sum that province saves and helps to reduce the overall national deficit. Paying interest rate on savings will convert it into borrowings, they added.

According to the report, FBR claimed that it had collected Rs 2.254 trillion in taxes during the FY 2013-14. Out of this amount, Punjab received Rs 645.8 billion, Sindh Rs384.6 billion, K-P Rs232 billion and Balochistan Rs137.9 billion on account of share in the divisible pool and royalties and grants provided to the provinces.

Speaking to The Express Tribune, Haji Adeel, K-P government’s technical member of the NFC, complained that the centre was not transferring the province’s due share on account of net hydel profit.

NFC award: Govt to dole out Rs2.6b to provinces – The Express Tribune

and then PTI walas say Federal Govt is ignoring KP Govt...

Has your govt paid Royalty to KPK? KPK produces gas, hydel power and oil is being deprived of its rightful share of funds by the federal government which is ignoring all the smaller provinces As a result KPK is being deprived of and being adversely treated on all fronts by federal govt.

1. Federal govt has yet to pay KPK agreed upon payments of net hydel profits amounting to Rs 6 billion.
2. In addition, the decision regarding uncapping of Net Hydel Profits which was finalised by the Technical Committee of the federal govt in March 2013 and duly notified has yet to be implemented. These arrears stand in excess of Rs 138 billion - owed to KPK govt.
3. Levy of excise duty on crude oil under Article 161 of the Constitution. This is provincial revenue but the federal govt has to notify it which they are refusing to do. As a result the annual loss of revenue for KPK is in excess of Rs 15 billion.
4. Provision of Windfall Levy under Clause 4.1 of the Petroleum Policy 2015 of which 50 % was to go to KPK has not been levied. This has caused a loss of more than Rs 25 billion per annum to KPK.
5. Non payment of royalty on LPG as decreed by PHC is resulting in losses of hundreds of millions of rupees annually.
6. Foreign loans/grants from donors by provinces under Article 167 of the Constitution. This right has remained inoperative because the federal govt has not put into place the requisite framework prescribed by the NEC nor have the provinces been given their borrowing limits.
7. Compensation for unutilised share of water under the 1991 Accord: As a result of a lack of infrastructure which the federal govt was to put in place is leading to 34 % less utilisation of water by KPK than the entitled share of KPK. The federal govt must compensate for this economic loss based on the formulas agreed upon in the feasibility study of Mangla Dam raising - which amount will be Rs 119 billion.
8. The shameful ban on wheat movement from Punjab to KPK which was only lifted in a clear political muk muka between the CM Punjab and the Governor KPK timed to influence by elections in KPK

Now give answers to these questions to prove that your federal govt isn't ignoring KPK.


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