LAHORE: In two years the PTI's government in Punjab has managed to meet fiscal challenges, which were left by the previous government, by redefining the priorities to ensure fiscal discipline, said a report released by the Punjab Finance Department.
The Punjab government released its two-year performance report 'Innovations and Reforms Performance Review 2018/19 and 2019/20', in which the performance and achievements by the finance department is highlighted.
"Despite a host of fiscal challenges and systemic impediments inherited by the government at the onset and those brought about by the Covid-19 pandemic, considerable progress has been realised," the report said.
As per the document, fiscal discipline on the non-development side and increasing focus on social sectors on the development side were the hallmarks of Punjab Budget 2018-19. It pointed out that the incoming government in 2018 inherited a struggling economy.
"The Punjab Finance Department had to grapple with total liabilities of Rs97.4 billion and there were a total of more than 20,000 unpaid cheques amounting to Rs56.1 billion. The (previous) government had availed an overdraft up to Rs41.3 billion and GP Fund of its employees was consumed to the tune of Rs102 billion," it added.
The report stated that in Punjab Budget 2018-19, the government redefined its priorities and created fiscal space. "Through prudent fiscal management, an additional Rs97 billion were made available through revenue mobilisation and rationalisation of expenditure. Moreover, as its top priority, the government enhanced allocations in social sectors (health and education) from Rs560.9 billion for FY 2017-18 to Rs631.1 billion for FY 2018-19," it added.
It also highlighted that in support of the Federal government, the Punjab government budgeted Rs147.8 billion as estimated provincial surplus and increased transparency of the budget-making process through improvements in budget documents (white paper, citizen budget and budget highlights).
At the close of the FY 2018-19, the government managed to increase budget releases from 70 per cent in 2017-18 to 96 per cent in 2018-19 and budget utilisation was also increased from 65 per cent in 2017-18 to 90 per cent in 2018-19. Moreover, there were zero pending liabilities at the close of FY 2018-19 and no overdraft limit consumed, the report said.
"These improvements constituted the stepping stone for more purposeful action in the FY2019-20. The new Budget focused on social sector and regional equalisation and thus austerity and fiscal prudence on the non-development side and a major focus on regional equalisation and social protection on the development side were the hallmarks of this budget," it said.
Among the salient features of the Budget were: increasing the Provincial Own Source Revenue target to Rs388 billion from the revised estimate of Rs269 billion of FY 2018-19 (44.6 per cent increase); all-time high additional Resource Mobilisation of Rs24.91 billion through innovative measures/restructuring; saving of Rs55 billion by reducing non-salary current expenditure; mitigating the adverse impact of macroeconomic challenges on vulnerable groups through a comprehensive social protection programme (Ehsaas Punjab); increased allocation for social sectors from 32 per cent in FY 2017-18 to 41 per cent in 2019-20; increased allocation for health sector from 8 per cent in FY 2017-18 to 15 per cent in 2019-20 and 35 per cent of ADP reserved for South Punjab.
However, the report observed that the onset of Covid-19 in the latter half of 2019-20 hindered the achievement of targets, which the Punjab Finance department was well on its way to accomplish. "The unprecedented situation required adroit and deft financial management. The department devised a strategy to reset the priorities given the fiscal constraints, as it was realised very early in the pandemic that a balancing act was in order. Funds available with various entities in the PIFRA System were off-lined, redistribution was effected and was made available again realising the emergent requirements," it added.
Copyright Business Recorder, 2020
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