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May 23, 2019

Provincial Finance: Commission decides to retain earlier formulas


May 23, 2019

PESHAWAR: A meeting of the 11th Provincial Finance Commission of Khyber Pakhtunkhwa was held under the Chairmanship of KP Finance Minister Taimur Saleem Jhagra.

KP Minister for Local Government and Rural Development Shahram Khan Tarakai, Secretary Finance Department Shakil Qadir Khan, Secretary LG and RD Zahir Shah, Secretary Law Department Zakaullah Khattak, DG Local Government Adil Iftikhar, Assistant Chief P&D Department Muhammad Islam and members of the commission attended the meeting.

The finance secretary briefed the meeting about various matters pertaining to the constitution of the formula and answered the questions raised by the commission members. For the financial year 2019-20, the commission decided to continue with last year’s provincial finance commission formulas, through which 60 per cent of resources will be distributed amongst the districts on the basis of population.

A further 20 per cent will be distributed on the basis of poverty while the remaining 20 per cent will go to districts to shore up infrastructure there. The commission recommended approval of the budget provisions for the districts of newly merged areas for the next financial year, 5 percent annual incremental increase in salary and 10 percent increase on the non-salary component for the merged districts was also recommended. For the establishment of 25 Tehsil Municipal Administration in newly-merged areas, a grant of Rs542.617 million as one-time operational grant during the next financial year was also approved. An operational grant of Rs175 million for the establishment of district and village/neighbourhood councils in newly merged areas Rs25 million per unit/district was also approved. The commission recommended approval of Rs4 billion to merged districts in the developmental programme for the fiscal year, 2019-20. For the newly-created district of Upper Chitral, Rs1485.012 million fund approval was given by the commission. While bifurcating the budget for Lower Chitral and Upper Chitral, the deputy commissioner was also intimated to separate the share of Chitral district on account of salary, non-salary, grant to local councils and development grant, the meeting was told.

Commission Chairman Taimur Saleem Jhagra said after the merger of erstwhile Fata into the province, it was a historic award which would go a long way towards improving service delivery by local governments in Khyber Pakhtunkhwa and newly merged tribal districts. He said the government wanted to empower local governments in the province and soon a new uniform and improved local bodies system would be enforced in the whole province including merged tribal districts.

“The devolution of 30 percent of the total development budget of the province to local governments is a proof of the resolve of the government to ensure devolution of financial authority to local governments,” the minister concluded.

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