Center for the suspension of funding for uplift projects in the provinces

 

Center for the suspension of funding for uplift projects in the provinces

ISLAMABAD: Faced with the increasing scarcity of resources, the Center has decided in principle to stop funding development projects in the provinces, especially those related to decentralized issues, in order to shift the financial burden, which is now over 320 billion rupees, to the federal units.

This is part of a new National Development Framework (NDF) with which the federal government intends to limit its investment priorities to the areas of responsibility of the federal government and to ensure that the federal states assume full financial policy responsibility for all decentralized subjects. The issue was discussed at a special session of the Central Development Working Party (CDWP) on Monday. The chair was chaired by the Deputy Chairman of the Planning Commission (DCPC) Mohammad Jehanzeb Khan.

A high-ranking official of the planning commission informed Dawn that after the 18th constitutional amendment and the abolition of the concurrent list, 16 federal ministries along with development projects had been transferred to the respective provinces. The federal program for the development of the public sector (PSDP) advised against the financing of projects with a provincial character, with the exception of vertical core projects in the area of ​​health and population until 2017.

However, the financial burden on the federal budget continued to increase, although its fiscal share in the divisible pool shrank almost simultaneously from over 57 percent to around 45 percent as part of the award of the 7th National Finance Commission (NFC). The provincial projects have since crept back into the federal PSDP and leave limited fiscal leeway for projects of national importance.

Wants the provinces to take full financial

responsibility for all decentralized subjects

                                                                            

In the 2021-22 PSDP, about 331 provincial nature projects are valued at 1.151 trillion rupees (out of about 1,190 PSDP projects in total), the official said, adding that the center is already about 345 billion rupees for these projects with an Allocation of 330 billion rupees. These projects should be funded by the provinces themselves, he added.

In reviewing the guidelines during the CDWP meeting, the DCPC highlighted that the Planning Commission is in the process of developing an NDF that will guide the federal government's investment priorities, it said in an official statement, adding that there is overlap The business rules exist and there is a need to regulate roles and responsibilities at the federal and state levels.

The NDF will also be presented to the provinces for feedback before being presented to the National Economic Council, the statement said.

The meeting found that the major federal projects of national importance were suffering from cost overruns and delays due to provincial burdens. When allocating the budget for this year, the NEC had already decided in principle that it would be impossible for the center to finance provincial projects, with the exception of projects in the social sector, within the framework of the SDGs.

According to the existing policy approved by the NEC in June, the provinces are required to bear the costs of land acquisition, relocation, provincial taxes and the costs of project monitoring units, and to ensure their sustainable operation and maintenance.

The meeting proposed a review of SDG-related projects to streamline their tax burden on the center, and the provinces would not politically require funding of provincial projects through the PSDP.

The Prime Minister is also asked to approve a policy whereby plans proposed by parliamentarians are referred to the provinces for inclusion in the annual provincial development plans.

The official statement said the CDWP discussed guidelines for funding provincial nature projects by the federal PSDP, allocating a percentage of total PSDP spending to run an effective media campaign for PSDP projects, drafting the gender policy framework, a pilot research study on public sector job creation for women and the Voluntary National Review (VNR).

In the discussion of the draft gender policy framework, the Chair emphasized the need to create opportunities for girls and women, to strengthen them in decision-making processes and to recognize their representation in all areas of life.

He said the national perspective on gender is needed. The importance of gender needs to be understood in all ministries and in the provinces as the gender indicators are not very good. Action plans for gender programming will be developed showing their commitment to this important aspect.

The Planning Commission will issue an annual report on the status of the sexes in Pakistan. To make the workplace women-friendly, quarterly reviews and surveys are carried out to determine progress.

Jehanzeb Khan stated that guidelines and sectoral guidelines should also be developed for the ministry, adding that clarity is needed in various areas and the nature of the projects.