provincial Govts diverted Rs235.8 billion of local government funds to favoured MPAs

In violation of the constitution, the four provincial governments have diverted Rs235.8 billion of local government funds to favoured members of provincial assemblies, according to a foreign-funded non-governmental organisation working for the promotion of local bodies. In a white paper on local finance, the Jeeway Pakistan Jeeway Maqami-Hakoomat (JPJM) said the illegal allocation of local government funds has gone on for three years.
“The Punjab government doled out Rs119.7 billion, the Sindh government Rs83.5 billion, Khyber-Pakhtunkhwa (K-P) Rs23.8 billion and Rs8.8 billion were given way by the Balochistan government,” the paper states. The federal government realeased large funds to the provinces following the 18th amendment and the National Finance Commission (NFC) award. The share of local governments in the overall transfer of funds came down drastically from 60% of the net divisible pool in 2009-10 to 41% in 2010-11 in Punjab, showed the paper.
Similar ratios were observed in Balochistan, Sindh and K-P.
The paper also showed that provinces received a higher share under the NFC Award. Punjab received Rs205 billion, compared to last year’s Rs151 billion, while Sindh received Rs158 billion, an increase of Rs64 billion from the previous year.
In K-P, the total increase in allocation to local governments was as high as Rs13 billion and Rs17 billion against estimated amounts of Rs10 billion to Rs13 billion in 2010-11. An increase of Rs4 billion was earmarked by Balochistan.
According to details, Rs151 billion intended for local governments was misappropriated by Punjab, despite a substantial improvement in the provincial consolidated fund. In Sindh the figure was Rs121 billion, in K-P Rs54 billion, and in Balochistan Rs4 billion.
The white paper also quoted Pakistan’s Nov 28, 2008 agreement with the International Monetary Fund to increase interest rates to reduce inflationary pressure. However, contrary to the agreement, the State Bank of Pakistan decreased interest rates by 1.5%.
Over the last two years, representatives of local council associations have filed 27 cases in superior courts for the restoration of local governments and against the appointment of administrators in place of nazims. So far there has been no progress in the courts.
Meanwhile, JPJM chairman Daniyal Aziz has decided to launch a campaign against the government for not holding local government elections. “It’s a violation of Article 140-A of the constitution,” he said.
Provinces, he added, had illegally transferred local government funds into MPA’s discretionary funds. “We are going to hold a convention on the restoration of the local government system after holding elections,” he said. The convention will be held in Gujranwala on November 3. Aziz also said that the Punjab government categorically refused to give permission to hold the convention in their province.

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