The government is likely to allocate Rs 252 billion for Public Sector Development Programme (PSDP) 2005-06, against Rs 202 billion of 2004-05, it was reliably learnt here on Thursday. Sources said PSDP is an important segment of Pakistan's fiscal policy and its size would be increased for the next fiscal year to ensure sufficient funds for social sector development schemes. The policy-makers said that contrary to the past, now the government was in much better position to allocate more funds for PSDP, as it could be an effective tool in combating poverty. They claim that utilisation of the current fiscal year's PSDP was almost 100 percent. Historically, PSDP utilisation had been much less than the target.
The last year's utilisation was also below the target. The policy-makers are convinced that in the past short spending of PSDP was indicative of poor fiscal discipline and now that shortcoming has been tackled effectively.
The sources said Prime Minister Shaukat Aziz had formed a committee in the first half of the current fiscal year on PSDP and directed it to review progress on public sector development. The committee met every month to monitor that PSDP utilisation was as per the target and all its schemes were getting due share of funds. The sources said the provincial share in 2005-06 PSDP will be around Rs 65 billion. The tentative date for finalisation of PSDP is May 28.
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