ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has approved Rs250 billion to adjust excessive spending by the provinces during the current fiscal year with Khyber-Pakhtunkhwa overrun budgeted allocation by Rs214 billion.
The ECC meeting presided over by Finance Minister Ishaq Dar was put up a summary by the Finance Division stating that supplementary grant (SG)/technical supplementary grant (TSG) of Rs250 billion is required to adjust the overspending by the provinces.
The ECC was informed that the existing ways and means advance limits for all four provinces stood at – Punjab 77 billion, Sindh 39 billion, Khyber-Pakhtunkhwa 31.3 billion, and Balochistan 17 billion. An amount of Rs10 billion was allocated under the headways and means advances to provinces during the current fiscal year.
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However, the government of Khyber-Pakhtunkhwa has availed advances to the tune of Rs224 billion, cumulatively, from ways and means, during the current fiscal year till 24th May 2023.
In order to adjust the expenditure of Rs214 billion incurred in excess of the allocated budget and the likely future requirements of provinces during the current fiscal year, Rs250 billion SG/TSG is required.
The ECC was further told that the above expenditures would have no impact on the overall fiscal deficit of the federal government as the advances are availed for a brief period and the SBP reverses the transactions together with mark-up as and when sufficient cash balance is available in the provincial governments’ accounts.
The same is booked as capital receipts/non-tax receipts of the federal government. The ways and means advances availed so far during the current fiscal year have already been replenished. The Finance Division sought approval of the ECC for the proposals in terms of Article 84 of the Constitution of the Islamic Republic of Pakistan.
On a summary moved by the Ministry of Commerce regarding the extension of the period for export of sugar quota by sugar mills in Sindh, the ECC allowed the export of the remaining sugar quota of 32,000 metric tonnes within 60 days with effect from 12th June onwards in accordance with the Sindh High Court’s decision.
The ECC also considered a summary of the Ministry of Railways for the provision of additional funds in grant in aid to Pakistan Railways for the discharge of pending liabilities including salaries and pensions of the staff. It was decided that an additional grant-in-aid of Rs2.5 billion may be released to address the shortfall in order to ensure the continuation of operations without interruption.
The ECC considered and approved (i) Rs3.628 billion as TSG in favour of the Ministry of Housing and Works for execution of development schemes in all provinces; (ii) Rs172.001 million as TSG in favour of Ministry of Housing and Works for ERE liabilities; (iii) Rs1,200 million as TSG in favour of Ministry of Housing and Works for the execution of 16 development schemes; (iv)Rs1,238 million as TSG in favour of the Ministry of Energy (Petroleum Division) for the fulfillment of government’s commitment to fund Balochistan Mineral Resources Limited’s obligatory contribution in the Reko-Diq project for the fiscal year 2022-23.
The meeting was attended by the Federal Minister for Commerce Syed Naveed Qamar, Minister of State for Petroleum Musadik Masood Malik, SAPM on Finance Tariq Bajwa, Coordinator to the PM on Economy Bilal Azhar Kayani, federal secretaries and other senior officers attended the meeting.
Copyright Business Recorder, 2023
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