ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has sought details of subsidies given to provinces during the last three years along with share contributed by the provinces, official sources told Business Recorder.
The Committee headed by Finance Minister, Shaukat Tarin, gave these instructions to the Ministry of National Food Security and Research during a discussion on its proposal titled “extension of the date for a subsidy to farmers of Sindh and Balochistan under PM’s Package for the agriculture year 2020-21.”
According to sources, the Ministry of National Food Security and Research stated that the Federal Cabinet on March 9, 2021, ratified the decision of ECC taken on February 19, 2021 which pertained to subsidy on DAP fertilizer, cotton seed and whitefly-related pesticides for Kharif Crop 2O2l on a sharing basis (Federal Government 75% & Provincial Government 25%).
The Ministry maintained that the provincial governments had agreed to use their existing subsidy disbursement mechanisms. It was added that Punjab had already developed an E-voucher scheme, KPK had a coupon system, and Sindh had developed an E-card system and was also in process of registering small farmers for subsidy disbursement, whereas Balochistan was also developing its own system. It was further noted that the federal government had already released Rs 3.890 billion to Sindh and Rs 0.541 billion to Balochistan for the subsidy scheme and that there was no additional financial liability on the part of the federal government.
ECC likely to okay fertiliser subsidy today
Ministry of National Food Security and Research stated that as per ECC decision the provincial governments were required to disburse subsidy amount and submit funds utilization certificate by January 1, 2022. Accordingly, Punjab and Khyber Pakhtunkhwa had submitted their requisite report/ certificate; however, Sindh and Balochistan could not disburse their allocated subsidy within the stipulated time and requested for an extension.
The Ministry requested the ECC to grant an extension in date for subsidy disbursement to the farmers on Kharif crop during 2021 on DAP fertilizer, cotton seed and whitefly-related pesticides.
The Finance Division stated that previous approval of the ECC was for last year. However, as the funds were not utilized; therefore, it required fresh approval and the ECC may consider it. Accordingly, Secretary Finance Division requested the ECC to direct the Ministries/ Divisions to follow up utilization of the funds allocated to them. They should either be utilizing the funds released to them within the timeframe or surrender them to the Finance Division without any delay. After detailed discussion, the ECC granted extension of the date for subsidy to farmers of Sindh and Balochistan under PM’s Package for the agriculture year 2020-21.
Provinces to be asked to share subsidy burden
The ECC further directed the Ministry of National Food Security and Research to devise a transparent tracking mechanism to ensure that the Federal and Provincial contribution/ shares were released and utilized, effectively.
The ECC also directed the MoNFS&R to present details of subsidies given and shares contributed by the provinces in the last three years in the next meeting.
Copyright Business Recorder, 2022
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