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Sindh govt presents Rs 577.98bn tax-free budget

12 June, 2012

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KARACHI: Sindh Finance Minister Syed Murad Ali Shah on Monday unveiled Rs 577.98 billion tax-free Sindh budget for fiscal year (FY) 2012-13 with Rs 7.166 billion deficit.

The new budge has been raised by 21 percent as compared to FY 2011-12. The provincial government has created 80,000 new jobs for the FY 2012-13. Capital expenditure estimates of Rs 31.5084 billion, non-development expenditure estimates of Rs 315.3013 billion and development expenditure estimates of Rs 231.1742 billion have been made.

The finance minister announced the budget in his speech at the Sindh Assembly. He said 20,000 jobs would be created through Sanction New Estimate 2012-13. He said, "Under various skill development initiatives, more than 300,000 unemployed youth were trained in various trades to build their capacity and enable them to obtain gainful employment in private sector."

The finance minister said, "The total budgetary outlay is proposed to be Rs 577.98 billion as against Rs 236.2 billion in 2007-08. The total receipts are projected at Rs 570.82 billion." He said, "Whereas the total expenditure is estimated to be Rs 577.98 billion, resulting in deficit of Rs 7.166 billion". Despite a healthy 18 percent estimated increase in revenues, the deficit is solely due to the massive jump in development portfolio which has been proposed at a historic Rs 231 billion, up from Rs 164 billion in 2011-12, indicating Pakistan People's Party (PPP)-led government's resolve to focus on poverty alleviation and result-oriented development, finance minister claimed. He added the figure includes Annual Development Programme of Rs 181 billion, Rs 14.5 billion for federal projects and Rs 35.7 billion foreign project assistance.

According to him, the estimated revenue receipts for the FY 2012-13 from the Federal Divisible Pool are Rs 314.36 billion and it is 24.8 percent higher than the budget estimates of FY 2011-12. Receipts under straight transfers are estimated at Rs 59.25 billion, which is an increase from last year's budget estimate of Rs 53.4 billion.

The collection of sales tax on services has been estimated at Rs 96.63 billion, which is 21 percent higher than last year and its provincial own receipts, Shah claimed.

He further said, "On the expenditure side, the current revenue expenditure for FY 2012-13 had been estimated at Rs 315.3 billion which was only slightly higher than the revised estimate of Rs 309.45 billion for 2011-12, he added. This reflects Sindh government's resolve to curtail expenses through fiscal discipline."

In line with the increase in salaries announced by the federal government, it was proposed that employees of Sindh government might also be allowed a pay raise in the shape of ad-hoc relief allowance at the rate of 20 percent of basic salaries.

Similarly, to mitigate the financial difficulties of the pensioners, they would also be granted 20 percent ad-hoc relief allowance.

Federal government's funds transfers estimates are Rs 381.9 billion for the FY 2012-13 and the provincial own receipts/funds estimates will be Rs 570.81 billion in the FY 2012-13.

Easements have been increased in the mode education, health, Thar coal development and to establish girls cadet colleges in entire province, however, budget has been allocated for establishment of two cadet colleges at Garhi Khuda Bukhsh, Larkana and Shaheed Benazirabad.

Shah, presenting the fifth budget of the PPP government, said the government-faced multitude of challenges with many of them passed down from previous regimes; however, under the leadership of President Asif Ali Zardari, the government overcame such challenges with unflinching democratic will.

The Sindh government was facing very unsympathetic situation from the year 2010, that the years were destroying period for the people of the Sindh and Sindh government due to the heavy floods had displaced millions of people, Shah said.

The finance minister further said that the Sindh Board of Revenue is expected to achieve its target of Rs 25 billion during the current fiscal year (CFY) 2011-12. He added the Sindh government had increased 28 percent revenue collection for the fiscal year 2012-2013 in this regard and the estimates for collection had been set at Rs 32 billion.

He said an unprecedented development outlay of Rs 231.17 billion in the upcoming fiscal year was a 63.8 percent increase over budget estimates of Rs 141 billion during the CFY 2011-12. "Current revenue expenditure is projected at Rs 315.30 billion, which is marginally higher than Rs 309.45 billion of the previous fiscal," the finance minister claimed.

He said in the current fiscal year, Sindh Bank would payout its maiden dividend of Rs 1 billion to the Sindh government. "The estimated provincial development expenditure of Rs 231 billion includes Rs 181 billion from provincial own resources, Rs 35 billion through Annual Development Programme assisted Flood Emergency Reconstruction Projects and Rs 14.51 billion through federal grants", Shah added. He said Rs 644 billion had been allocated for development during last five years by the government, while the cumulative development spending from the year 1947 to 2007 was Rs 310 billion, which is less than half of the amount allocated in five-years of the incumbent government, finance minister claimed.

Sindh faces power crises as well as countrywide and the Sindh government has decided to fulfill needs of the power and it is also planning to set up 100 Mega Watts power plant under Public Private Partnership (PPP) at Nooriabad", Shah said. "At present 26 projects of wind energy with installed capacity of 1800 Mega Watts are in progress", he said.

Sindh government would like to develop education sector so Rs 111.96 billion has been allocated for the education, including Rs 12.39 billion for the development schemes", Shah said.

Cadet Colleges: The Sindh government had decided to provide high quality education to the girls of rural areas.

Shah during his budget speech announced that the Sindh government would establish a network of cadet colleges across Sindh. "In education, there have been significant breakthroughs which include establishment of two new universities, seven cadet golleges, including two girls cadet colleges", he said. "Two projects of the girls cadet colleges will be started during the 2012-13 at Garhi Khuda Bukhsh, Larkana and second at Shaheed Benazirabad district, four engineering colleges and institutes, and one law college", the finance minister added.

He said significant progress had been attained in village electrification and provision of gas to rural areas. "During the tenure of this government, a total of 3,000 villages will be electrified and a total of 800 villages will be provided gas by the end of June 2012."

MPA Priority Programme: The allocation for MPA priority Programme has been proposed to be enhanced to Rs 60 million for each MPA. This compares fairly well with the allocation of Rs 5 million for MPAs in FY 2007-08. The finance minister also announced development packages for Hyderabad, Larkana, Sukkur and other cities. He announced Rs 1 billion package for Hyderabad city and said, Hyderabad had been provided approximately Rs 1 billion for schemes relating to roads, flyovers, water supply, sanitation and parks.

Development package: Under the Larkana Development Package, Rs 2 billion were provided to fund major roads and bridges in Larkana. He added a development package for Benazirabad district is Rs 2 billion, which was provided to construct critical infrastructure. "Sukkur received about Rs 700 million for development schemes in roads and sanitation sectors," Shah added. During next financial year Rs 10.6 billion have been proposed for special packages which comprised Rs4.4 billion for Karachi, Rs 2 billion each for Larkana and Shaheed Benazirabad, Rs 1 billion for Hyderabad, Rs 700 million for Sukkur and Rs 500 million for Mirpurkhas, Shah concluded.


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