The NWFP government has expressed annoyance over Water and Power Development Authority (Wapda) for not paying rupees six billion Net Hydel Profit (NHP) due to which the provincial government's Account No-1 has gone into red, official sources told Business Recorder on Tuesday.
The sources said the provincial Finance Department, in a letter to Wapda Chairman Shakil Durrani on June 9, said that the disbursement of NHP was being made on most irritatic and irregular manner, causing imbalances to the province's cash flow. "So far we have been paid rupees three billion only and as the current financial year would end on June 30, our cash balance has deteriorated," the sources quoted Provincial Finance Secretary Abdus Samad Khan as saying in the letter.
The provincial government had requested the Wapda that the balance amount of NHP pertaining to the current financial year should be disbursed to the province immediately. The same date, the Wapda dispatched two checks of Standard Chartered Bank (SCB) for Rs 200 million each, totalling Rs 400 million, on account of second instalment of NHP for the third quarter of 2008-09. According to the Wapda, the balance payment due for the third quarter of 2008-09 stood at Rs 1,100 million.
On June 13, the Provincial Finance Department wrote another letter to the Wapda Chairman, saying that during the current fiscal year, the provincial government has received only Rs 3.5 billion as against the total due amount of rupees six billion.
"We point out that payment of second quarter of the 2008-09 financial year was also received in piece meal. The remaining NHP must be disbursed well before the closing of the current financial year," the sources quoted Provincial Finance Ministry as requesting the Wapda authorities.
When contacted, Wapda Chairman Shakil Durrani confirmed delay in payment of NHP to the provincial government and promised that the remaining amount would be cleared during the current week. "Yes, there is some delay in payment of NHP to the provincial government. I hope the remaining amount will be disbursed before the end of current financial year," he added.
Both Wapda and the provincial government are already in litigation over the calculation of NHP as the former challenged the decision of the Arbitration Tribunal in a local court. In July 2006, former prime minister Shaukat Aziz indicated that the government was considering a new formula for NHP distribution, which was against the interests of Punjab and NWFP of their existing entitlements on royalty of hydropower projects.
According to the Constitution, NHP is the right of the province where the powerhouse is located. But the new formula, if approved, would deprive Punjab and NWFP of the royalty of Ghazi Brotha hydropower project (GBHP) and Bhasha-Diamer dam, respectively.
According to the formula (now dead), 15 percent of NHP would be given to the province where the powerhouse is located; 20 percent to the area where the dam or barrage is located; 30 percent for the people whose land would be submerged; 30 percent to the affected population; and five percent for environmental upgradation. Prepared by the former Wapda Chairman Shamsul Mulk, the formula had been opposed by the provinces, especially by Punjab and NWFP, as it could hurt their interest in GBHP and Bhasha-Diamer dam.
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