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Sindh presents Rs 82.127bn budget

Deficit stands at Rs 2.272bn; Rs 14.328bn earmarked for education, Rs 4.207bn for health, Rs 11.408bn for debt-servicing; police get Rs 6.215bn

30th June ,2001  

KARACHI: Sindh Finance Minister Dr Abdul Hafeez Shaikh presented a deficit provincial budget for the financial year 2001-2002 with a total outlay of Rs 82.127 billion, showing a deficit of Rs 2.272 billion on the current expenditure side. The budget has a current revenue expenditure of Rs 71.702 billion and Annual Development Plan of Rs 10.425 billion.

Presenting the budget live on radio and television, the minister said that the government had neither imposed any new tax nor had the rate of any tax been increased.

In the budget, tuition fee in government secondary schools and Parchi fee in all government hospitals has been abolished. The exemption limit in property tax for widows and the orphan, which was enhanced last year to Rs 7,200 has been further enhanced to Rs 10,000.

The rate of stamp duty for registration of Articles and Memorandum of Association has been reduced by 60 per cent from Rs 5,000 to Rs 2,000 per document. Stamp duty of financing documents of banking companies has been rationalised and reduced from the previous rate of 1 per cent to 0.2 per cent or less.

Dr Hafeez Sheikh said that the budget had been prepared in the backdrop of the devolution of power and resources, taking place in the country this year. In addition to the provincial budget, 16 districts budget have also been prepared. He said that a Provincial Finance Commission had been created to give its first award in December for the distribution of resources between the province and various districts.

The minister said that the current expenditure for the fiscal year 2000-2001 had been pitched at a level of Rs 71.702 billion against total provincial revenue receipts of Rs 69.429 billion, showing a deficit of Rs 2.272 billion. The receipts include Rs 36.911 billion resources transfer from Islamabad, straight transfers of Rs 15.870 billion and Octroi and Zilla tax grant of Rs 4.137 billion. The federal transfers represent an increase of 10.6 per cent over the revised estimates of for 2000-2001.

The provincial receipts for 2000-2001 has been estimated at Rs 12.5 billion, an increase of
10 per cent over the revised estimates of Rs 11.350 billion to be raised by provincial government from its own resources.

According to Dr Hafeez Sheikh, the revenue deficit during 2000-2001 is estimated to be Rs 2.272 billion and capital receipts for the next year Rs 3.262 billion against the capital expenditure of Rs 6.501 billion during the current financial year.

The current revenue expenditure of Rs 71.702 billion represents an increase of 6 per cent over the revised estimates of Rs 67.657 billion for 2000-2001. This increase is primarily meant to clear committed or deferred liabilities in phases, State Bank of Pakistan, controlling the growth in non-development expenditures and diverting surplus resources for development, maintenance of infrastructure and job creation.

In the current revenue expenditure for the next fiscal year, an amount of Rs 1.029 billion has been earmarked for the organs of state, Rs 7.336 billion for finance department, Rs 4.600 billion for superannuation and pension, Rs 6.215 billion for police, Rs 14.328 billion for education, Rs 4.207 billion for health, Rs 6.645 billion for grants and subventions, Rs 1.649 billion for land reclamation, Rs 1.623 billion for irrigation, Rs 1.454 billion for agriculture and food administration, Rs 3.576 billion for subsidies, Rs 11.408 billion for debt-servicing, investible funds and grants and Rs 2.090 billion for other expenditure.

Regarding revenue receipts of the total amount of Rs 69.429 billion, the Sindh government is projecting an income of Rs 60.763 billion from taxes -- Rs 52.782 billion from federal government and Rs 7.981 billion from provincial government's share.

The provincial government is to receive Rs 12.500 billion from tax and non-tax receipts including Rs 4.518 billion from non-taxable income and Rs 7.981 billion from taxes, Rs 82.422 million from income from property and enterprises, Rs 94.680 million from general administration, Rs 83.707 million from community services, Rs 569.023 million from law and order, Rs 476.759 million from social sector, Rs 1.137 billion from economic services, Rs 2.361 million from receipts from civil administration and other functions, Rs 4.147 billion from grants from federal government and Rs 2.074 billion from miscellaneous receipts.

The provincial finance minister said that the estimates for transfers from the divisible pool had been revised to Rs 32.655 billion against the budget estimates of Rs 36.497 billion, showing a decrease of 11.8 per cent. The straight transfers had been revised to Rs 15.064 billion against the budget estimates of Rs 13.057 billion, an increase of 15.4 per cent, he said.

Federal grant for Octroi and Zilla Tax had been decreased to Rs 4.527 billion against the budget estimates of Rs 5.710 billion and the provincial revenue receipts revised down to Rs 11.350 billion against the budget estimates of Rs 11.376 billion.

The fiscal deficit was reduced from Rs 4.08 billion in 1999-2000 to Rs 1.64 billion in 2000-01. The revised estimates for the capital receipts are Rs 2.962 billion and for capital expenditure Rs 5.596 billion. The revised outlay for development programme is estimated to be Rs 8.019 billion against the budget estimates of Rs 11.253 billion.

The minister stated that overdraft with State Bank of Pakistan, which was over Rs 10 billion in mid-1999 had been lowered to Rs 2.10 billion presently. "We are hopeful that on July 1 the overdraft will be entirely wiped out and Sindh will enter the new fiscal year with a positive cash flow with the SBP for the first time after more than a decade," he said.

The blocked account with the SBP requiring the government to pay for the overspending of the past had been reduced from Rs 6 billion in year 2000 to Rs 2.9 billion in 2001, the finance minister said.
 

Agriculture sector 

DROUGHT

The second half of the financial year witnessed a serious drought in Thar and Kohistan endangering human life and livestock because of malnutrition and dehydration. However, with the blessings of Allah, the situation has been averted by timely intervention of the Provincial Government with the assistance of the Pakistan Army by providing relief goods to the most inaccessible areas. Federal Government provided cash grant of Rs 1.0 billion. The voluntary social welfare organisations exhibited a deep sense of responsibility by supplementing the relief operation. The government and people of Sindh appreciates these gestures of goodwill. The Provincial Government with the active support and assistance of the Pakistan Army is also undertaking various roads and water supply schemes in the arid zone to provide long term solution and sustainability in the area.

A Water Management Cell is being established in the Irrigation and Power Department for better co-ordination with Agriculture Department for efficient use of available water resources and increasing the agricultural productivity in Sindh.

 AGRICULTURE SECTOR

TOTAL ALLOCATION(Rs. IN MILLION)..........91.900
NO.OF SCHEMES.....................................27

WATER AND POWER SECTOR

Total Allocation (Rs. in million).........400.00
No. of schemes.............................32

Sindh presents Rs 82.127bn budget

Deficit stands at Rs 2.272bn; Rs 14.328bn earmarked for education, Rs 4.207bn for health, Rs 11.408bn for debt-servicing; police get Rs 6.215bn

30th June ,2001  

KARACHI: Sindh Finance Minister Dr Abdul Hafeez Shaikh presented a deficit provincial budget for the financial year 2001-2002 with a total outlay of Rs 82.127 billion, showing a deficit of Rs 2.272 billion on the current expenditure side. The budget has a current revenue expenditure of Rs 71.702 billion and Annual Development Plan of Rs 10.425 billion.

Presenting the budget live on radio and television, the minister said that the government had neither imposed any new tax nor had the rate of any tax been increased.

In the budget, tuition fee in government secondary schools and Parchi fee in all government hospitals has been abolished. The exemption limit in property tax for widows and the orphan, which was enhanced last year to Rs 7,200 has been further enhanced to Rs 10,000.

The rate of stamp duty for registration of Articles and Memorandum of Association has been reduced by 60 per cent from Rs 5,000 to Rs 2,000 per document. Stamp duty of financing documents of banking companies has been rationalised and reduced from the previous rate of 1 per cent to 0.2 per cent or less.

Dr Hafeez Sheikh said that the budget had been prepared in the backdrop of the devolution of power and resources, taking place in the country this year. In addition to the provincial budget, 16 districts budget have also been prepared. He said that a Provincial Finance Commission had been created to give its first award in December for the distribution of resources between the province and various districts.

The minister said that the current expenditure for the fiscal year 2000-2001 had been pitched at a level of Rs 71.702 billion against total provincial revenue receipts of Rs 69.429 billion, showing a deficit of Rs 2.272 billion. The receipts include Rs 36.911 billion resources transfer from Islamabad, straight transfers of Rs 15.870 billion and Octroi and Zilla tax grant of Rs 4.137 billion. The federal transfers represent an increase of 10.6 per cent over the revised estimates of for 2000-2001.

The provincial receipts for 2000-2001 has been estimated at Rs 12.5 billion, an increase of
10 per cent over the revised estimates of Rs 11.350 billion to be raised by provincial government from its own resources.

According to Dr Hafeez Sheikh, the revenue deficit during 2000-2001 is estimated to be Rs 2.272 billion and capital receipts for the next year Rs 3.262 billion against the capital expenditure of Rs 6.501 billion during the current financial year.

The current revenue expenditure of Rs 71.702 billion represents an increase of 6 per cent over the revised estimates of Rs 67.657 billion for 2000-2001. This increase is primarily meant to clear committed or deferred liabilities in phases, State Bank of Pakistan, controlling the growth in non-development expenditures and diverting surplus resources for development, maintenance of infrastructure and job creation.

In the current revenue expenditure for the next fiscal year, an amount of Rs 1.029 billion has been earmarked for the organs of state, Rs 7.336 billion for finance department, Rs 4.600 billion for superannuation and pension, Rs 6.215 billion for police, Rs 14.328 billion for education, Rs 4.207 billion for health, Rs 6.645 billion for grants and subventions, Rs 1.649 billion for land reclamation, Rs 1.623 billion for irrigation, Rs 1.454 billion for agriculture and food administration, Rs 3.576 billion for subsidies, Rs 11.408 billion for debt-servicing, investible funds and grants and Rs 2.090 billion for other expenditure.

Regarding revenue receipts of the total amount of Rs 69.429 billion, the Sindh government is projecting an income of Rs 60.763 billion from taxes -- Rs 52.782 billion from federal government and Rs 7.981 billion from provincial government's share.

The provincial government is to receive Rs 12.500 billion from tax and non-tax receipts including Rs 4.518 billion from non-taxable income and Rs 7.981 billion from taxes, Rs 82.422 million from income from property and enterprises, Rs 94.680 million from general administration, Rs 83.707 million from community services, Rs 569.023 million from law and order, Rs 476.759 million from social sector, Rs 1.137 billion from economic services, Rs 2.361 million from receipts from civil administration and other functions, Rs 4.147 billion from grants from federal government and Rs 2.074 billion from miscellaneous receipts.

The provincial finance minister said that the estimates for transfers from the divisible pool had been revised to Rs 32.655 billion against the budget estimates of Rs 36.497 billion, showing a decrease of 11.8 per cent. The straight transfers had been revised to Rs 15.064 billion against the budget estimates of Rs 13.057 billion, an increase of 15.4 per cent, he said.

Federal grant for Octroi and Zilla Tax had been decreased to Rs 4.527 billion against the budget estimates of Rs 5.710 billion and the provincial revenue receipts revised down to Rs 11.350 billion against the budget estimates of Rs 11.376 billion.

The fiscal deficit was reduced from Rs 4.08 billion in 1999-2000 to Rs 1.64 billion in 2000-01. The revised estimates for the capital receipts are Rs 2.962 billion and for capital expenditure Rs 5.596 billion. The revised outlay for development programme is estimated to be Rs 8.019 billion against the budget estimates of Rs 11.253 billion.

The minister stated that overdraft with State Bank of Pakistan, which was over Rs 10 billion in mid-1999 had been lowered to Rs 2.10 billion presently. "We are hopeful that on July 1 the overdraft will be entirely wiped out and Sindh will enter the new fiscal year with a positive cash flow with the SBP for the first time after more than a decade," he said.

The blocked account with the SBP requiring the government to pay for the overspending of the past had been reduced from Rs 6 billion in year 2000 to Rs 2.9 billion in 2001, the finance minister said.
  

Text of Sindh budget speech

9. DROUGHT

The second half of the financial year witnessed a serious drought in Thar and Kohistan endangering human life and livestock because of malnutrition and dehydration. However, with the blessings of Allah, the situation has been averted by timely intervention of the Provincial Government with the assistance of the Pakistan Army by providing relief goods to the most inaccessible areas. Federal Government provided cash grant of Rs 1.0 billion. The voluntary social welfare organisations exhibited a deep sense of responsibility by supplementing the relief operation. The government and people of Sindh appreciates these gestures of goodwill. The Provincial Government with the active support and assistance of the Pakistan Army is also undertaking various roads and water supply schemes in the arid zone to provide long term solution and sustainability in the area.

A Water Management Cell is being established in the Irrigation and Power Department for better co-ordination with Agriculture Department for efficient use of available water resources and increasing the agricultural productivity in Sindh.

AGRICULTURE SECTOR

TOTAL ALLOCATION(Rs. IN MILLION)..........91.900
NO.OF SCHEMES.....................................27

WATER AND POWER SECTOR

Total Allocation (Rs. in million).........400.00
No. of schemes.............................32

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