Govt seeks approval to cut expenditures on new development projects
Government has moved a summary before the National Economic Council (NEC) seeking its approval to finalise 12th five-year plan, prepare framework for sustainable development goals and review performance of development programmes.
Prime Minister Shahid Khaqan Abbasi is scheduled to head NEC meeting soon in which the government would seek approval to stop expenditures on the new development projects whose allocation was less than 25 percent of total approved cost during the current fiscal year of 2017/18.
The 12th five year plan will be in line with Vision 2025 and its preparation will be finalised by June while it will be implemented from next fiscal year of 2018/19.
The government has envisaged raising GDP growth to 7.5 percent over the five years (from 2018 to 2023).
“We will move towards inclusive growth,” the official said. “After getting approval from NEC on approach paper the preparation of detailed five year plan would get momentum.”
The summary, moved to the NEC, which is the highest economic decision making forum of the country, said the ministries/divisions are requested not to make expenditures on the projects for which allocation for 2017/18 is less than 20 percent of approved cost without approval of ministry of planning, development and reforms. However, the limit has been raised to 25 percent on the direction of Public Accounts Committee.
“The ministries/divisions informed the Planning Commission that 257 projects would be completed by end of June 2018,” it said. “Other 44 projects can also be completed during the current financial year if additional fund of Rs16.6 billion could be arranged for these projects.”
The government released Rs550 billion in July-February period out of Rs1,001 billion earmarked for public sector development programme (PSDP).
Government spent the whole disbursement of Rs51 billion meant for special allocations, including Rs30 billion for Prime Minister’s global SDGs (sustainable development goals) achievements programme, utilised through members of parliament, just in the July-September period.
The government disbursed Rs42.075 billion for special federal development programme for temporarily displaced persons and security arrangements out of the total allocation of Rs90 billion and Rs9.199 billion for PM’s Youth and Hunarmand (skilled) Programme out of the allocation of Rs20 billion.
Other decisions, which have been submitted for the perusal of NEC, include the PSDP performance review in the context of actual funds released during July 2017 to Feb 19.
The summary further said additional demands for funds could not be considered due to small savings.
The Planning Commission said meetings were held with finance division, at the start of the current fiscal year, to work out modalities for release of funds to ensure maximum utilisation and reduce time required for release of PSDP funds.
Subsequently, the finance division waived off the ‘ways and means’ condition for clearance of development funds during the first quarter (July-Sept). The funds of ongoing projects were provided to ministries/divisions/corporations on a fast track basis during the first quarter.
Planning ministry undertook the first quarter review under the direction of NEC and held meetings with all the ministries/divisions and provincial governments. In these meetings, it was decided that planning ministry would request all ministries/divisions to provide information of all those projects which could be completed in second, third and fourth quarters of the current fiscal year. The government also sought details of those projects which could be completed with additional allocations by June 30.
During the first quarter review, the ministries/ divisions raised demand for additional fund of Rs69.4 billion and major demands were from ministry of water resource (Rs23.9 billion), Earthquake Reconstruction and Rehabilitation Authority (Rs21.1 billion), maritime affairs division (Rs5.4 billion), National Highway Authority (Rs2.5 billion), and ministry of housing and works (Rs2.5 billion). The ministries/division identified savings of Rs0.8 billion which was quite negligible keeping in view the additional fund demand of Rs69.4 billion.