LAHORE: The caretaker Punjab government on Monday has presented a budget, which surprised many financial experts, due to its tilting tune of paying-off provincial debts and providing a ‘public relief’, without providing much monetary details.
As per caretaker cabinet, comprises of Provincial Information Minister, Amir Mir, Industries and Commerce Minister S.M Tanveer, the provincial budget 2023-24 figures, under the article 126 of the constitution, are for the next four months of upcoming fiscal year i.e. from July 1st 2023 to 20th October 2023.
The total expenditures for this said period will be Rs1719 billion. The original expenditures figure for the current fiscal year were set at Rs3,101.4 billion, which have later been revised to Rs3,663.3 billion.
On revenue front for the said period, the province is expecting to get Rs881 billion tax receipts from federal government, whereas Punjab’s own revenue collection is expected to be at Rs194 billion.
The provincial government has not imposed any new tax in the budget, as a gesture for promoting Information Technology led businesses, all taxes on IT sector have been abolished. Additionally, Rs10 billion have been set aside for IT sector, which will be spent on developing IT parks in Lahore Knowledge Park.
The provincial government has also provided a 30% adhoc relief allowance on basic salary, whereas 5% increase in pensions for persons aged under 80 and 20% increase for above the age of 80 has also been announced in the budget. An amount of Rs721 billion would be spent on salaries and pensions.
For health sector, Rs183.7 billion, whereas for education, an amount of Rs195.1 billion have been allocated for next four months of FY 2023-24. For the first time in the history of Punjab, a Journalist Endowment Fund of Rs1 billion has also been established.
On development side, an allocation of Rs325 billion has been set aside for next four months. The amount will be spent to complete 2500 development projects out of total ongoing 4800 projects.
The surprising step of care taker provincial government was to clear-off the Punjab’s circular debt of Rs600 billion in next four months. According to the cabinet ministers, Punjab government owed Rs600 billion to various banks on account of wheat procurement and Rs250 million mark-up was being paid daily in this regard.
This debt could go up to Rs1100 billion by end 2023 and Rs2000 billion by end of 2025, therefore, the caretaker government has started the process of paying off the debt of Rs600 billion with the approval of the cabinet and it would be paid in next four months.
The province has earmarked Rs 70 billion for targeted social protection to provide relief to the poor people. For the purpose of giving targeted subsidy, different data base including BISP will be used to identify the right family.
For strengthening rural economy, Rs47.6 billion would be spent on agriculture initiatives against the total allocations of Rs12 billion for the current fiscal year.
Capital investment in energy sector would be Rs16.4 billion during next four months. Punjab Thermal Power (Private) Limited (PTPL), incorporated under the Companies Act, 2017 would be completed with this amount to eliminate the energy crisis in the province.
Service Delivery expenditure would be Rs120.4 billion, while proposal of increasing stamp duty to 3% has been rejected and it would be maintained at 1% to promote construction sector.
Responding to queries, the information minister said that from the day of retirement, government employees would be paid 65% of their salary for one year so that they did not have to wait for pension because it took almost a year to complete all the paper work. This would be a huge relief for the retiring employees, he remarked.
He said that minimum wage would be kept equal to that of the federal government. The employees were drawing higher salaries compared to the federal government that was why pension increased at five percent.
However, the cabinet ministers did not give a satisfied answer of getting the money inflow to complete the development projects and paying off the huge Rs600 billion debt. The minister, nevertheless claimed that Punjab will end this fiscal year in a surplus of Rs400 billion. Whereas when the caretaker setup will be ended, we are expecting to leave the government with another surplus amount of Rs112 billion in the provincial kitty.