Sindh presents Rs1.477 trillion deficit budget; no new tax levied

KARACHI: The provincial government on Tuesday presented the Rs1.477 trillion Sindh Budget for the financial year 2021/22 with a deficit of Rs25.7 billion.

The provincial government has not imposed any new taxes during the next fiscal year. Regarding pay and pension, the provincial government has proposed a 20 per cent increase in the salaries, while a 10 per cent increase has been proposed for the pensioners, besides the minimum wages have been proposed to be increased to Rs25,000.

Sindh Chief Minister Syed Murad Ali Shah presented the budget in the provincial assembly, amid uproar from the opposition benches.
The chief minister said the total budget outlay for the financial year 2021/22 has been estimated at Rs1.477 trillion, as against the budget estimates of Rs1.241 trillion for the outgoing financial year, showing an overall increase of 19 per cent.

The current expenditures of the province is projected at Rs1.14 trillion, which includes the current revenue expenditures of Rs1.089 trillion and the current capital expenditures of Rs59.49 billion.

“This is 78 per cent of [the] total expenditures of the province and shows an increase of 14 per cent over the estimates of Rs1 trillion for the last year,” he said.

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For the next financial year, the provincial government has tried to align development, as well as non-development expenditure priorities in line with the post-Covid-19 situation, he added.

The total receipts of the province for the financial year 2021/22 have been estimated at Rs1.452 trillion as against the budget estimates of Rs1.22 trillion for the current financial year, showing an overall increase of 19 per cent.

Receipts from the federal government on account of revenue assignment, straight transfers and grants are estimated at Rs869.68 billion, which constitute 72.5 per cent of the total receipts of the province, showing an increase of 12.6 per cent over the estimates of Rs760.30 billion last year.

However, the budget estimates of straight transfers for the next financial year have decreased substantially by approximately 20.6 per cent to Rs49.50 billion from the budget estimates of Rs62.34 billion of the current financial year. Receipts of the federal Public Sector Development Programme (PSDP) are estimated at Rs5.37 billion.

Receipts on account of foreign project assistance (FPA), budgetary support loans and grants are estimated at Rs71 billion. Receipts from the province’s own resources on account of tax and non-tax receipts are estimated at Rs329.033 billion, which constitute 27.5 per cent of the total receipts, showing an increase of 4.8 per cent over the estimates of Rs313.4 billion of the current financial year.

The development expenditure of the province is estimated at Rs329.032 billion, which include Rs222.5 billion for the Provincial Annual Development Plan (ADP) and Rs30 billion for districts ADP, foreign project assistance of Rs71.16 billion and Rs5.4 billion from the federal PSDP grant for schemes being executed by the government of Sindh.

Shah said that in the financial year 2021/22, around 1,033 schemes have been identified for completion in the first and second quarters and maximum resources will be provided for their timely completion. The ongoing schemes with the remaining throw-forward up to Rs100 million have been fully funded for completion by June 2022. The ongoing schemes where 70 per cent expenditure is made have been fully funded for completion by June 2022.

The chief minister said the output of the government is directly related to the performance of every individual employee. “All the employees of the provincial government have my gratitude,” he added.

For the next financial year, we are proposing an increase of 20 per cent in the basic salary of all employees. For the welfare of the labour class and in line with the increase in the pay of government employees, the minimum wage rate is also being enhanced from Rs17,500 to Rs25,000/month, he said.

In order to remove discrepancy and bridge the gap between gross salary and minimum wages, i.e., Rs25,000, a personal allowance is proposed for the employees of the government of Sindh in BPS-1 to BPS-5. The fixed rate of personal allowance will be BPS-1, Rs1,900/month; BPS-2, Rs1,500/month; BPS-3, Rs900/month; BPS-4, Rs250/month; and BPS-5 Rs250/month.