Economics & Business

Poor development spending in Sindh slows socio-economic uplift

Karachi: Development spending of the Sindh government over first three quarters of the current fiscal year has moved at a significantly slower pace compared to the same last year. Much of allocations for water, drainage, health and education, in particular, are un-utilized so far.

Experts say, spending on such sectors are instrumental to human development. Inadequate utilization of budgetary amounts earmarked for these important sectors clearly demonstrates disinterest of the government officials, responsible for utilizing the funds, in socio-economic development of the people of Sindh.

According to quarterly review of the spending of Sindh’s development budget, more than 71 per cent of the Sindh development budget has gone unspent despite passage of three quarters (July-March) for different reasons cited by the provincial planning department. On the other hand, nearly 60 per cent of the development budget was utilized during the same period last fiscal year (FY).

According to the progress report of the Sindh Planning and Development (P&D) department, the overall utilization of uplift funds from July 2011 to March 2011 stands at around 21,612 billion (28 per cent), while Rs37,520.123 billion (57.6 per cent) were released by the provincial finance department during the period under review out of revised Rs77 billion provided for the annual development program (ADP) 2011. The ADP embraces 34 development sectors, further categorized into 105 sub-sectors.

The Sindh government had approved an amount of Rs115 for development ongoing and new schemes of various departments for the FY 2010-11, nearly 35 per cent up from Rs75 billion for FY2009-10. But later in December last year, it had to sharply revise down the development expenditures announced in the budget for 2010-11 to Rs77 billion for creating space to finance post-flood rehabilitation exercise.

Review of the development budget utilization progress report for nine months indicates that despite sufficient releases (57.6 per cent) for implementation of different uplift schemes of various provincial departments, the departments have shown poor performance as far as utilization of the released amounts is concerned.

According to sector-wise ADP funds utilization against releases,

  • > the agriculture sector spent Rs238 million out of Rs2.182 billion released from the Rs2.113 billion revised allocation.
  • > The food department utlized Rs77 million out of the released amount of 175 million against Rs188 million allocation,
  • > fisheries and livestock department spent Rs211 million out of Rs852 million against Rs1.9 billion allocation,
  • > industries department spent 301 million out of Rs387 millions released against 842 million allocation,
  • > investment development department spent 5.428 million out of Rs30 million released against 312 million allocation,
  • > mines and mineral development department utilized Rs17 million out of Rs116 million released against 325.5 million allocation,
  • > water and drainage department spent 1.422 billion out of Rs1.981 billion released against Rs 2.6 billion allocations,
  • > transport and communication department utilized 4.784 billion out of Rs6.412 billion released against 8.450 billion allocation,
  • > education department utilized 2.547 billion out of Rs3.184 billion released against 4.560 billion allocation,
  • > health department spent Rs1.209 billion out of Rs2.608 released against 4.095 billion allocation,
  • > environment department utilized Rs22 million out of Rs45.4 million released against Rs179 million allocation,
  • > rural development department spent Rs61 million out of Rs162.5 million released against 284.5 million allocation and
  • > public private partnership department spent Rs369 million out of Rs596.5 million released against Rs3.265 billion allocation for the current FY.

Officials in the provincial P&D department spelled out different reasons for poor spending of the development budget. Adviser to Sindh Chief Minister for planning and development, Qaiser Bengali, said that

  • > slow flow of receipts from federal government,
  • > transfers of NFC funds,
  • > poor revenue generation from province’s own resources,
  • > low recovery from different Kharif crop,
  • > which were damaged by the ravaging floods of last year,
  • > had left the provincial government with inadequate availability of financial resources to implement uplift schemes of the different provincial departments.

“Although revised uplift budget is Rs77 billion, but there is unlikely that such an amount would be available till end of the current FY,” he said.

Qaiser Bengali said that given the tight financial and revenue situation, overall development budget utilization by the end of current FY would be around Rs55 billion as against the revised Rs77 billion allocation. Senior officials in the provincial finance department have voiced their concern over slow spending of the amounts for implementation of uplift schemes.

“Although adequate funds from the allocated development budget have been released to different provincial departments, but they have not shown good performance in using the released funds,” said a senior finance official.

The official pointed out that usually the spending gets momentum in the last quarter of the year, which often leads to corruption and mal-utilization of the development funds. We have raised this issue with the heads of different departments to check such practices once for all and utilize the funds when they are released, but in vain, he said.

About the author

Saleem Shaikh

The writer is a development journalist. He writes on water, sanitation, environment, climate change, agriculture, women development, human rights, education, health, development budgets and economy.

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