Budget deficit estimated to be Rs3.3tr in FY 2018-19

ISLAMABAD: Despite lower utilisation of development funds by Rs100-125 billion, the budget deficit is estimated to hike by Rs1,100 billion during the first year rule under PTI-led regime in financial year 2018-19.The budget deficit in 2018-19 has been estimated at Rs3.3 trillion in the fiscal year 2018-19 ended on June 30, 2019 under PTI rule against Rs2.2 trillion in 2017-18 under the PML-N-led regime.Therefore, the budget deficit is all set to hike by Rs1,100 billion and might cross the mark of Rs3,300 billion or 8.5 percent of Gross Domestic Product (GDP).The budget deficit under the PML-N-led regime stood at 6.6 percent of GDP equivalent to Rs2.2 trillion in fiscal year 2017-18. The budget deficit, which is considered mother of all economic ills has escalated and witnessed new heights, which had never seen in the history. The massive revenue shortfall on account of both tax and non-tax revenues as well as escalated expenditure paved the way for hiking the deficit to over Rs3.3 trillion in financial year 2018-19.The federal share of Public Sector Development Programme (PSDP) stood at Rs675 billion for financial year 2018-19 out of which the initial estimates suggested that the utilisation of PSDP funding would be standing at Rs550-575 billion during this period. The utilisation of PSDP funds stood at Rs576.1 billion in 2017-18 under the PML-N regime.When contacted one top official of Planning Commission on Wednesday said that they released 95 percent of allocated amount of Rs675 billion. The details of utilised funding will be made available with time lag as it comes under jurisdiction of Ministry of Finance.He said that the reconciled utilised amount of PSDP would be available by September 2019. However, Finance Ministry officials said that the utilisation of federal PSDP remained lower by Rs100 to Rs125 billion during the fiscal year 2018-19 against revised allocation of Rs675 billion.The throw forward (the amount that required to complete all projects of PSDP list) stood at Rs5,500 billion and the government allocated just Rs701 billion for the current fiscal year 2019-20.Now the funds for current and development expenditure shall be released at the level of 20 percent each for Quarter 1 and Quarter 2, and at the level of 30 percent of each for Quarter 3 and Quarter 4, except the funds required for payment of salaries and pension would be released @ 25 percent of budget for each quarter.No funds shall be released for un-approved projects; funds for Quarter 1, not exceeding Rs500 million, shall be recommended/released by the Planning, Development and Reform (PD&R) Division. Amounts exceeding Rs500 million shall be referred to Budget Wing of Finance Division for ways & means clearance; Funds for Quarter 2 onwards will be recommended by Planning, Development and Reforms Division after due examination/scrutiny and shall be forwarded to Finance Division for ways and means clearance along with cash work plan and second utilisation report of funds duly reconciled with AGPR/Accounts Office and approval of Principle Accounting Officer of concerned Ministry/Division; Funds would not be released for unapproved projects. Further, if for any project, no funds have been released during the first two quarters, only 40 percent allocation would be released for remaining two quarters and PSDP releases would be made for each quarter and release for two quarters would not be made in one go.

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