ISLAMABAD: The country’s development programme seems to be in tatters, incapable of meeting even a fraction of its infrastructure and growth potential, while budgetary allocations are flowing to constituency politics and deficit financing, in what is deemed a blatant violation of the decisions of the National Economic Council (NEC), the apex economic decision-making body.
This is the crux of a formal summary, presented by the Ministry of Planning, Development and Special Initiatives to the Annual Plan Coordination Committee (APCC) and the NEC, for course correction as part of the next year’s budget, with instructions to the Ministry of Finance to stay within the financial limits granted by the NEC to avoid stymieing national development.
Specifically, it required the finance ministry to “provide the foreign exchange component (FEC) cover wherever required and also exempt the development spending from austerity measures”, not to make at-source deductions of cash development loans (CDL) and not to divert development funds to the non-development side during a specific year.
The summary suggested that the Ministry of Finance’s boasting about surpassing the primary balance target — even significantly higher than committed to the IMF — during the outgoing fiscal year was at the expense of development projects, increasing their costs, delaying beyond repeated annual deadlines and losing significantly on opportunity cost.
It said the current year’s Public Sector Development Programme (PSDP) was cut by 25 per cent to Rs717 billion against Rs950bn allocation approved by the NEC and the parliament.
Against this backdrop, the PSDP for the next year faced a series of critical challenges. The ministries and divisions came up with demands for Rs2.8 trillion as the project throw-forward surged to Rs9.8tr this year against Rs3tr in 2013-14. The size of PSDP allocation and expenditure remained stagnant at an average of Rs630bn during the decade.
This is the crux of a formal summary, presented by the Ministry of Planning, Development and Special Initiatives to the Annual Plan Coordination Committee (APCC) and the NEC, for course correction as part of the next year’s budget, with instructions to the Ministry of Finance to stay within the financial limits granted by the NEC to avoid stymieing national development.
