Budget in Brief 2019-20
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Page 1
PREFACE
Budget in Brief is a synopsis of the Federal Budget 2019-20. It provides
aggregated information on revenues and expenditures, budgeted for fiscal year
2019-20 alongwith budget estimates and revised estimates for the fiscal year
2018-19. Detailed information is available in the relevant budget documents.
Budgeting and accounting classification system used in the budget continues to
be same. It was adopted under the New Accounting Model introduced in fiscal
year 2004-05.
The Medium Term Budgetary Framework (MTBF) process, initiated in
the fiscal year 2009-10, has been strengthened. Indicative Budget Ceilings for
the current and development budgets are issued to all Principal Accounting
Officers of the Federal Government on a three-year rolling basis. The annual
budget estimates for relevant fiscal year (e.g. 2019-20) are then finalised in
consultation with various Federal Ministries. Linkage between allocations and
public service delivery has been established through Output Based Budgeting.
Performance of Federal Ministries/Divisions has been monitored against
precisely defined key performance indicators.
This document also includes medium term macroeconomic indicators to
provide strategic economic perspective, and contextualize the Budget 2019-20.
For the convenience of readers, some additional information regarding
subsidies, loans and advances and public sector development programme has
been shown separately. After approval by the parliament, all budget books,
including the Budget in Brief, will be uploaded on the website of the Ministry of
Finance: www.finance.gov.pk.
‘Budget at a Glance’ given at the end of this document offers a quick
overview of the federal budget. I hope that this document will be beneficial to all
those who seek a simple and clear understanding of Budget 2019-20.
Naveed Kamran Baloch
Secretary to the Government of Pakistan
Finance Division
Islamabad, the 11th June, 2019Page 2
C O N T E N T S
Page
Chapter 1: Review of the Budget 2018-19 1
Salient Features 1
Summary - Budget and Revised Estimates 2
Resources 3
- Internal Resources 3
{Net Revenue Receipts 3
{Net Capital Receipts 4
{Estimated Provincial Surplus 4
- External Resources 5
Expenditure 6
- Current 6
- Development 6
Chapter 2: The Budget 2019-20 7
Salient Features 7
Comparative Budgetary Position 8
Chapter 3: Resource Position 2019-20 9
- Internal Resources 10
{Net Revenue Receipts 10
{Net Capital Receipts 13
{Estimated Provincial Surplus 13
- External Resources 14
Chapter 4: Provincial Share in Federal Taxes 15
NFC Award 15
President's Order No. 5 of 2010 16
President's Order No. 6 of 2015 20
Details of Provincial Share in Federal Taxes 21
Net Federal Transfers to Provinces 22
Chapter 5: Current Expenditure 2019-20 23
Current Expenditure (Summary) 23
Comparative Position (Comparison) 24
General Public Service 25
Defence Affairs and Services 26
_______________________________________________________________
Contd.........Page 3
C O N T E N T S
Public Order and Safety Affairs 27
Economic Affairs 28
Environment Protection 29
Housing and Community Amenities 29
Health Affairs and Services 30
Recreational, Culture and Religion 31
Education Affairs and Services 32
Social Protection 33
Chapter 6: Subsidies & Grants/Transfers 34
Details of Subsidies 34
Details of Grants and Transfers 36
Chapter 7: Loans and Investments 38
Current Loans and Advances 38
Development Loans and Advances 39
Current Investments 40
Chapter 8: Public Sector Development Programme 41
Salient Features of PSDP 41
Size of PSDP 42
Development Expenditure Outside PSDP 45
Chapter 9: Medium Term Budgetary Framework (MTBF) 46
Budget Strategy Paper 46
Performance Budgeting 46
Performance Monitoring 47
Budget Preparation Process 47
Macroeconomic Indicators 48
Working of Fiscal Deficit and Financing for
Budget 2019-20 49
Budget at a Glance for the Fiscal Year 2019-20 51
Glossary of Terms 53________________________________________________________________Page 4
CHAPTER - 1
REVIEW OF THE BUDGET 2018-19
SALIENT FEATURES
1.1 The budget 2018-19 had the following salient features:
a) The total outlay of budget 2018-19 was Rs 5,932.5 billion. This size was higher
by 16.2% than the size of budget 2017-18. The size of outlay increased further
to Rs. 6,409.3 billion in revised estimates for FY. 2018-19.
b) The resource availability during 2018-19 had been estimated at Rs 4,917.2
billion, which increased to Rs 5,062.8 billion or by 3% in revised estimates 2018-
19.
c) The net revenue receipts for 2018-19 had been estimated at Rs 3,070.4 billion,
which decreased to Rs 2,569.0 billion or by 16.3% in revised estimates
2018-19.
d) The provincial share in federal revenue receipts was estimated at Rs 2,590.1
billion during 2018-19, which decreased to Rs 2,462.7 billion or by 4.9% in
revised estimates.
e) The net capital receipts for 2018-19 had been estimated at Rs 443.1 billion,
which increased to Rs 1,031.7 billion in revised estimates 2018-19 or by 132%.
f) The external receipts in 2018-19 were estimated at Rs 1,118.0 billion, which
increased to Rs 1,403.2 billion in revised estimates or by 25.5%.
g) The overall expenditure during 2018-19 had been estimated at Rs 5,932.5
billion, out of which the share of current expenditure was Rs 4,780.4 billion.
Current expenditure in revised estimates 2018-19 showed an increase of Rs 809
billion from budget estimates.
h) The expenditure on general public service for budget 2018-19 was estimated at
Rs 3,340.4 billion, which was 69.9% of the total current expenditure.
i) In budget 2018-19, the development expenditure outside Public Sector
Development Programme (PSDP) was estimated at Rs 180.2 billion, which
dereased to Rs 17.3 billion in revised estimates 2018-19.
00:08Page 5
j) The size of Public Sector Development Programme (PSDP) for 2018-19 was Rs
1,650 billion. Out of this, Rs 850 billion was allocated to provinces. Federal
PSDP was estimated at Rs 800 billion, out of which Rs 420.4 billion for Federal
Ministries/Divisions, Rs 246.1 billion for Corporations, Rs 5 billion for Pak
SDGs & Community Development Programme, Rs 8.5 billion for Earthquake
Reconstruction and Rehabilitation Authority (ERRA), Rs 5 billion for Special
Provision for CPEC Projects, Rs 10 billion for FATA 10 Year Plan, Rs 45 billion
for Relief and Rehabilitation of IDPs, Rs 45 billion for Security Enhancement, Rs
10 billion for Prime Minister's Youth Skill Dev. Initiative and Rs 5 billion for Gas
Infrastructure Development Cess.
k) To meet expenditure in fiscal year 2018-19, bank borrowing was projected at
Rs 1015.3 billion, which has been revised upwards to Rs 1,356 billion.
1.2 Table-1 below presents a Summary of comparative position of the budget and
revised estimates for fiscal year 2018-19:
TABLE - 1
SUMMARY OF ESTIMATES FOR 2018-19
(Rs in Million)
Budget Revised
Classification
2018-19 2018-19
RESOURCES ( A + B ) 4,917,162 5,062,796
A Internal Resources 3,799,139 3,659,640
- Net Revenue Receipts 3,070,439 2,568,977
- Net Capital Receipts 443,096 1,031,676
- Estimated Provincial Surplus 285,604 58,987
B External Resources 1,118,024 1,403,156
C Privatization Proceeds 0 0
EXPENDITURE (I + II) 5,932,464 6,419,111
I Current Expenditure on Revenue Account 4,780,359 5,589,431
- Current Exp. on Revenue Receipts 4,780,359 5,589,431
II Development Expenditure 1,152,105 829,680
- Federal PSDP 800,000 500,000
- Development Expenditure outside PSDP 180,238 162,929
- Development Loans & Grants to Provinces 171,867 166,751
BANK BORROWING 1,015,302 1,356,315
00:08Page 6
RESOURCES
INTERNAL RESOURCES
1.3 The internal resources come through net revenue receipts, capital receipts and
estimated provincial surplus. Table-2 provides the details of budget and revised
estimates for 2018-19 in respect of net revenue receipts, while Table-3 provides the
details of net capital receipts.
NET REVENUE RECEIPTS
1.4 After the share of Provinces in gross revenue is transferred, the net revenue
receipts of Federal Government were estimated at Rs 3,070,439 million in the budget
2018-19, which have now been revised downwards to Rs 2,568,977 million in the
revised estimates 2018-19 showing a decrease of 16.3%. Table-2 provides the
details:
TABLE - 2
NET REVENUE RECEIPTS
2018-19
(Rs in Million)
Budget Revised
Classification
2018-19 2018-19
TAX REVENUE ( A + B) 4,888,645 4,393,876
A. FBR TAXES 4,435,000 4,150,000
- Direct Taxes 1,735,000 1,659,000
- Indirect Taxes 2,700,000 2,491,000
B. OTHER TAXES 453,645 243,876
NON-TAX REVENUE 771,860 637,751
- Income from Property and Enterprise 236,869 285,127
- Receipts from Civil Administration and Other
Functions 305,837 170,625
- Miscellaneous Receipts 229,155 181,999
Gross Revenue Receipts 5,660,505 5,031,628
Provincial Share in Gross Revenue 2,590,066 2,462,651
NET REVENUE RECEIPTS 3,070,439 2,568,977
00:08Page 7
1.5 The tax revenue was estimated for budget 2018-19 at Rs 4,888,645 million,
which decreased to Rs 4,393,876 million or by 10.1% in revised estimates 2018-19.
The non-tax revenue for 2018-19 was estimated at Rs 771,860 million, which
decreased to Rs 637,751 million or by 17.4% in revised estimates 2018-19.
NET CAPITAL RECEIPTS
1.6 These receipts comprise proceeds of borrowing, money received in repayment
of loans, recoveries of advances/investments, proceeds of saving schemes, net
receipts from transactions under deposits and remittances heads. The net capital
receipts for the fiscal year 2018-19 were budgeted at Rs 443,096 million. The revised
estimates are Rs 1,031,676 million, which indicates an increase of 132.8%. Table-3
provides the details:
TABLE - 3
NET CAPITAL RECEIPTS
2018-19
(Rs in Million)
Budget Revised Classification 2018-19 2018-19
I. CAPITAL RECEIPTS ( A + B + C ) 685,770 1,236,155
A. Recovery of Loans 152,989 159,831
B. Public Debt (Net) 406,095 793,670
- Permanent Debt 113,557 624,255
- Floating Debt 292,538 169,415
C. Public Account 126,686 282,653
II. DISBURSEMENTS 242,675 204,479
NET CAPITAL RECEIPTS (I-II): 443,096 1,031,676
ESTIMATED PROVINCIAL SURPLUS
1.7 The estimated provincial surplus was budgeted at Rs 285,604 million for
2018-19, which decreased to Rs 58,987 million in revised estimates 2018-19 or by
79.3%.
00:08Page 8
EXTERNAL RESOURCES
1.8 The Government obtains foreign loans and grants to use for capital and
development expenditure. The external loans for 2018-19 were budgeted at
Rs 1,079,968 million, which are now projected at Rs 1,352,876 million in revised
estimates showing an increase of 25.3%.
1.9 External grants increased from Rs 29,452 million in the budget estimates
2018-19 to Rs 34,209 million in the revised estimates 2018-19 or by 16.2%.
1.10 Overall external resources were estimated at Rs 1,118,024 million, which
increased to Rs 1,403,156 million or by 25.5% in the revised estimates 2018-19.
Table-4 below presents the details:
TABLE - 4
EXTERNAL RESOURCES
2018-19
(Rs in Million)
Budget Revised
Classification
2018-19 2018-19
I. EXTERNAL LOANS ( a to d ) 1,079,968 1,352,876
a. Project Loans 290,071 362,359
b. Programme Loans 87,897 59,847
d. Other Aid 702,000 930,669
II. EXTERNAL GRANTS 29,452 34,209
A. EXTERNAL RESOURCES (I + II): 1,109,419 1,387,085
B. PROJECT LOANS & GRANTS OUTSIDE PSDP 8,605 16,071
Loans 8,024 13,599
Grants 581 2,472
TOTAL EXTERNAL RESOURCES (A + B): 1,118,024 1,403,156
00:08Page 9
EXPENDITURE
1.11 The budget estimates 2018-19 of the overall expenditure were Rs 5,932,463
million, which increased to Rs 6,419,111 million in revised estimates 2018-19 or by
8.2%.
1.12 The components of expenditure are current and development. Table-5 below
shows the comparative position of the budget and revised estimates of current and
development expenditure for the fiscal year 2018-19:
TABLE - 5
CURRENT AND DEVELOPMENT EXPENDITURE
2018-19
(Rs in Million)
Budget Revised
Classification 2018-19 2018-19
A. CURRENT 4,780,358 5,589,431
- General Public Service 3,340,430 4,048,341
- Defence Affairs & Services 1,100,334 1,137,711
- Public Order and Safety Affairs 132,289 133,021
- Economic Affairs 80,750 142,440
- Environment Protection 1,261 1,271
- Housing and Community Amenities 2,339 2,318
- Health Affairs & Services 13,897 13,991
- Recreation, Culture and Religion 9,242 10,512
- Education Affairs and Services 97,420 97,155
- Social Protection 2,396 2,672
B. DEVELOPMENT 1,152,105 829,680
- Federal PSDP 800,000 500,000
- Development Expenditure outside PSDP 180,238 162,929
- Development Loans & Grants to Provinces 171,867 166,751
TOTAL EXPENDITURE (A + B): 5,932,464 6,419,111
00:08Page 10
CHAPTER - 2
THE BUDGET 2019-20
SALIENT FEATURES
2.1 The budget 2019-20 has the following salient features:
a) The total outlay of budget 2019-20 is Rs 8,238.1 billion. This size is 38.9%
higher than the size of budget estimates 2018-19.
b) The resource availability during 2019-20 has been estimated at Rs 7,899.1
billion against Rs 4,917.2 billion in the budget estimates of 2018-19.
c) The net revenue receipts for 2019-20 have been estimated at Rs 3,462.1 billion
indicating an increase of 12.8% over the budget estimates of 2018-19.
d) The provincial share in federal taxes is estimated at Rs 3,254.5 billion during
2019-20, which is 25.7% higher than the budget estimates for 2018-19.
e) The net capital receipts for 2019-20 have been estimated at Rs 831.7 billion
against the budget estimates of Rs 443.1 billion in 2018-19 reflecting an
increase of 87.7%.
f) The external receipts in 2019-20 are estimated at Rs 3,032.3 billion. This shows
an increase of 171.2% over the budget estimates for 2018-19.
g) The overall expenditure during 2019-20 has been estimated at Rs 8,238.1
billion, out of which the current expenditure is Rs 7,288.1 billion.
h) The expenditure on General Public Services is estimated at Rs 5,607.0 billion,
which is 76.9% of the current expenditure.
i) The development expenditure outside PSDP has been estimated at Rs 85.8
billion in the budget 2019-20.
00:08Page 11
j) The size of Public Sector Development Programme (PSDP) for 2019-20 is
Rs 1,613 billion. Out of this, Rs 912 billion has been allocated to provinces.
Federal PSDP has been estimated at Rs 701 billion, out of which Rs 348.2
billion for Federal Ministries/Divisions, Rs 348.2 billion for Corporations, Rs 5
billion for Earthquake Reconstruction and Rehabilitation Authority (ERRA), Rs 17
billion for Relief and Rehabilitation of IDPs, Rs 53 billion for Security
Enhancement, Rs 5 billion for Prime Minister's Youth Skill Development
Initiative, Rs 2 billion for Clean Green Pakistan Movement/Tourism, Rs 1 billion
for Gas Infrastructure Development Cess, Rs 48 billion for Merged Areas of
FATA 10 Years Development Plan and Rs 24 billion for Pakistan Sustainable
Development Goals (SDGs) and Community Development Programme.
k) To meet expenditure, bank borrowing has been estimated for 2019-20 at Rs
339 billion, which is lower by 688.7 billion than the revised estimates 2018-19
reflecting decrease at 75%.
2.2 Table-6 below presents the comparative position of budget and revised estimates
for fiscal year 2018-19 and budget estimates for fiscal year 2019-20.
TABLE - 6
COMPARATIVE BUDGETARY POSITION
2018-19 AND 2019-20
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
RESOURCES ( A + B ) 4,917,162 5,062,796 7,899,077
A Internal Resources 3,799,139 3,659,640 4,716,753
- Net Revenue Receipts 3,070,439 2,568,977 3,462,099
- Net Capital Receipts 443,096 1,031,676 831,659
- Estimated Provincial Surplus 285,604 58,987 422,995
B External Resources 1,118,024 1,403,156 3,032,325
C Privatization Proceeds 0 0 150,000
EXPENDITURE (I + II) 5,932,464 6,419,111 8,238,073
I Current Expenditure on Revenue
Account 4,780,359 5,589,431 7,288,179
- Current Exp. on Revenue Account 4,780,359 5,589,431 7,288,179
II Development Expenditure 1,152,105 829,680 949,895
- Federal PSDP 800,000 500,000 701,000
- Dev. Expenditure outside PDSP 180,238 162,929 85,791
- Dev. Loans & Grants to Provinces 171,867 166,751 163,104
BANK BORROWING 1,015,302 1,356,315 338,996
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CHAPTER - 3
RESOURCE POSITION
2019-20
3.1 There are two type of resources i.e. internal and external. The internal
resources comprise of revenue receipts, capital receipts and estimated provincial
surplus. The external resources come from foreign loans and grants. Table-7
below presents the overall comparative resource position for the year 2018-19
(budget and revised) and 2019-20 (budget).
TABLE - 7
RESOURCE POSITION
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
A Internal Resources 4,041,814 3,864,119 4,902,044
I. Net Revenue Receipts [(i) - (ii)] 3,070,439 2,568,977 3,462,099
(i) Gross Revenue Receipts 5,660,505 5,031,628 6,716,624
(ii) Less Provincial Share in Taxes 2,590,066 2,462,651 3,254,526
II. Total Capital Receipts 685,770 1,236,155 1,016,950
III. Estimated Provincial Surplus 285,604 58,987 422,995
B External Resources 1,118,024 1,403,156 3,032,325
TOTAL RESOURCES ( A + B ) 5,159,837 5,267,275 7,934,369
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INTERNAL RESOURCES
I. NET REVENUE RECEIPTS
3.2 The gross revenue receipts in budget 2019-20 are estimated at Rs 6,716,624
million showing an increase of 18.7% over the budget estimates 2018-19 and 33.5%
over revised estimates of outgoing fiscal year 2018-19.
3.3 The provincial share in taxes for 2019-20 is estimated at Rs 3,254,526 million,
which is 32.2% higher than the revised estimates of 2018-19. After the share of
Provinces in gross revenues is transferred, the net revenue of Federal Government
has been estimated to be Rs 3,462,099 million for fiscal year 2019-20.
3.4 The tax revenue for 2019-20 is estimated at Rs 5,822,160 million, which
reflects an increase of 33% over revised estimates 2018-19. Out of which FBR
collection is Rs 5,555,000 million. Non-tax revenue is projected at Rs 894,464
million in 2019-20 as compared with Rs 637,751 million in revised estimates
2018-19.
3.5 Tables 8 to 10 presents information on various components of tax revenue and
non-tax revenue.
TABLE - 8
NET REVENUE RECEIPTS
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
TAX REVENUE (A + B) 4,888,645 4,393,876 5,822,160
A. FBR TAXES 4,435,000 4,150,000 5,555,000
- Direct Taxes 1,735,000 1,659,000 2,081,945
- Indirect Taxes 2,700,000 2,491,000 3,473,055
B. OTHER TAXES 453,645 243,876 267,160
NON-TAX REVENUE 771,860 637,751 894,464
- Property and Enterprise 236,869 285,127 269,582
- Civil Administration and Other Functions 305,837 170,625 430,961
- Miscellaneous Receipts 229,155 181,999 193,921
Gross Revenue Receipts 5,660,505 5,031,628 6,716,624
Provincial Share in Gross Revenue 2,590,066 2,462,651 3,254,526
NET REVENUE RECEIPTS 3,070,439 2,568,977 3,462,099
00:08Page 14
TABLE - 9
TAX REVENUE
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
A. FBR TAXES (I + II) 4,435,000 4,150,000 5,555,000
I. Direct Taxes 1,735,000 1,659,000 2,081,945
- Income Tax 1,709,939 1,651,584 2,073,000
- Workers Welfare Fund 18,636 4,186 5,050
- Capital Value Tax 6,425 3,230 3,895
II. Indirect Taxes 2,700,000 2,491,000 3,473,055
- Customs Duties 735,000 735,000 1,000,500
- Sales Tax 1,700,000 1,490,000 2,107,738
- Federal Excise 265,000 266,000 364,817
B. OTHER TAXES 453,645 243,876 267,160
- Other Taxes (ICT) 37,555 7,492 11,100
- Airport Tax 90 30 35
- Gas Infrastructure Development 100,000 25,000 30,000 Cess (GIDC)
- Natural Gas Development 16,000 8,000 10,000 Surcharge
- Petroleum Levy 300,000 203,354 216,025
TOTAL TAX REVENUE: 4,888,645 4,393,876 5,822,160
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TABLE - 10
NON-TAX REVENUE
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
NON-TAX REVENUE (A+B+C) 771,860 637,751 894,464
A. Income from Property and Enterprise 236,869 285,127 269,582
- Pakistan Telecom Authority (Surplus) 12,787 12,787 1,000
- PTA (3 G Licences) 6,854 66,620 52,730
- Regulatory Authorities (Surplus/
penalities) 325 1,221 1,282
- Mark up (Provinces) 16,782 22,935 24,112
- Mark up (PSEs & Others) 123,649 120,958 124,495
- Dividends 76,471 60,607 65,963
B. Receipts from Civil Administration
and Other Functions 305,837 170,625 430,961
- General Administration 5,754 4,028 4,284
- SBP Profit 280,000 147,395 406,070
- Defence 15,960 14,730 15,453
- Law and Order 1,412 1,587 2,034
- Community Services 1,214 1,312 1,454
- Social Services 1,497 1,572 1,666
C. Miscellaneous Receipts 229,155 181,999 193,921
- Economic Services 8,596 3,555 4,127
- Foreign Grants 15,902 13,738 18,795
- Citizenship, Naturalization & Passport
Fee 31,000 23,000 25,000
- Discount Retained on Local Crude Price 10,000 14,029 16,000
- Royalty on Crude Oil 16,826 26,931 24,673
- Royalty on Natural Gas 36,516 51,225 51,560
- Windfall Levy against Crude Oil 5,000 6,974 7,000
- Petroleum Levy on LPG 2,000 3,736 4,000
- Extraordinary Receipts (UNO) 34,001 26,852 30,000
- Extraordinary Receipts (Others) 50,062 53 57
- Others 19,252 11,906 12,711
00:08Page 16
II. NET CAPITAL RECEIPTS
3.6 Capital receipts on net basis in the budget 2019-20 have been estimated
at Rs 831,659 million against Rs 443,096 million in the budget estimates 2018-19
and Rs 1,031,676 million in the revised estimates 2018-19. Table-11 below
presents the details of capital receipts, disbursements and net capital receipts.
TABLE - 11
NET CAPITAL RECEIPTS
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
TOTAL CAPITAL RECEIPTS (I + II) 685,770 1,236,155 1,016,950
I. Recoveries of Loans & Advances 152,989 159,831 183,520
- Provinces 61,596 71,393 79,371
- Others 91,393 88,438 104,150
II. CAPITAL RECEIPTS (A + B) 532,781 1,076,324 833,430
A. Public Debt Net (1 + 2) 406,095 793,670 582,677
1. Permanent Debt 113,557 624,255 211,930
- Pakistan Investment Bonds 100,000 705,947 200,000
- Ijara Sukuk Bonds 10,620 (82,480) 8,993
- Foreign Exchange Bearer
Certificates (FEBCs) -5 -1 -5
- Foreign Currency Bearer
Certificates (FCBCs) -5 -1 -5
- U.S. Dollar Bearer Certificates -3 0 -3
- Special US Dollar Bonds -50 -40 -50
- Premium Prize Bonds (Regd.) 3,000 830 3,000
2. Floating Debt 292,538 169,415 370,747
- Prize Bonds 92,538 137,711 70,747
- Treasury Bills Auction 200,000 31,704 300,000
B. Public Account 126,686 282,653 250,753
- National Savings Schemes 128,698 315,882 275,628
- G.P. Fund 2,000 2,500 3,000
- Net Deposits (4,012) (35,729) (27,875)
III. DISBURSEMENTS 242,675 204,479 185,291
- Government Investments, Loans,
Advances and Others 68,512 60,812 76,991
- Repayment of Short Term Credits 174,163 143,666 108,300
NET CAPITAL RECEIPTS (I + II - III): 443,096 1,031,676 831,659
Net Lending to Others: (22,882) (27,626) (27,158)
III. ESTIMATED PROVINCIAL SURPLUS
3.7 The estimated provincial surplus has been projected at Rs 422,995 million for
2019-20 as against Rs 58,987 million in revised estimates 2018-19.
00:08Page 17
EXTERNAL RESOURCES
3.8 The government obtains loans and grants to bridge the gap between the
receipts and expenditure. The external resources for 2019-20 have been projected at
Rs 3,032,325 million, which are higher by 171.2% and 116.1% respectively when
compared with budget and revised estimates 2018-19. Table-12 below presents the
details of receipts from external resources.
TABLE - 12
EXTERNAL RESOURCES
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
I. EXTERNAL LOANS (A to C) 1,079,968 1,352,876 2,990,579
A. Project Loans (i+ii) 290,071 362,359 211,171
i Federal Government 152,635 261,932 118,872
- Ministries/Divisions 22,576 34,878 16,118
- Corporations/Autonomous Bodies 130,060 227,054 102,754
ii Provinces 137,435 100,427 92,299
B. Programme Loans 87,897 59,847 276,958
C. Other Aid 702,000 930,669 2,502,450
- Islamic Development Bank 117,000 99,330 165,000
- Saudi Arabia (Saudi Oil) 0 0 480,000
- Euro Bond/International Sukuk 234,000 543,950 300,000
- Commercial Banks 351,000 6,875 450,000
- China Safe Deposits 0 275,000 0
- Eco. Trade Bank 0 5,514 0
- Budgetary Support from Friendly 0 0 750,000 Countries
- IMF Loan for Budgetary Support 0 0 357,450
II. EXTERNAL GRANTS 29,452 34,209 27,950
- Project Aid Grants 29,452 34,209 27,950
Federal• Departments 6,439 8,986 6,130
Autonomous• Bodies 1,228 11,661 1,677
Provinces• 21,784 13,562 20,143
D. External Resources (I + II): 1,109,419 1,387,085 3,018,529
E. Project Loans & Grants Outside
PSDP 8,605 16,071 13,796
Loans 8,024 13,599 13,250
Grants 581 2,472 546
TOTAL EXTERNAL RESOURCES (D+E): 1,118,024 1,403,156 3,032,325
00:08Page 18
CHAPTER - 4
PROVINCIAL SHARE IN FEDERAL TAXES
NFC AWARD
4.1 Pakistan is a Federal democracy. In order to maintain inter-governmental
fiscal relationship, Article 160 of the Constitution provides for setting up of a National
Finance Commission (NFC) with intervals not exceeding five years. The mandate of
NFC is to make recommendations to the President for the distribution of resources
between the Federal and Provincial Governments. The recommendations of the NFC
are given legal cover through a Presidential Order.
4.2 Presently, 7th National Finance Commission (NFC) Award is in practice.
Through this Award, the financial autonomy of the provinces has been ensured by
increasing their share in the Divisible Pool (taxes) from 46.5% to 57.5% from
2011-12 onwards. For the first time in history, multiple indicators were adopted for
distribution of provincial shares (horizontal distribution) in the divisible pool, whereas
in all the previous Awards, population remained as sole criterion for distribution of
provincial share with special grants (subventions) to smaller provinces.
4.3 A special feature of the 7th NFC Award is recognition for requirements of
Balochistan. Its share from the divisible pool was guaranteed at Rs 83 billion in
financial year 2010-11, which was more than double from the actual divisible pool
share of financial year 2009-10. It has also been ensured that Balochistan province
would receive its share in the divisible pool, based on the budgetary projections
instead of actual FBR collection. Shortfall, if any, based on the actual collection,
reported by FBR, is being made up by the Federal Government out of its own share.
This arrangement is in practice since financial year 2011-12 and shall continue till 7th
NFC Award remains in field. In this regard, an amount of Rs 119.18 billion has been
provided to Government of Balochistan, as additionality, from 2010-11 to 2018-19
(upto May, 2019).
4.4 The 8th NFC Award was constituted on 21st July, 2010, but it did not give
any Award as the latest Award was just implemented. The 9th NFC was constituted
on 24th April, 2015 and its 1st meeting was held on 28th April, 2015. the 9th NFC, in
its 1st meeting, constituted four working groups to undertake thematic studies to
assist the commission to make its deliberation meaningful. The reports of Working
Groups were presented and discussed in the 3rd meeting of the NFC held on 19th
December, 2016.
4.5 After General elections 2018, the 9th NFC was reconstituted in consultation
with provincial governments. The reconstituted NFC held two meetings on 6th
February 2019 and 29th March 2019 at Islamabad and Lahore respectively. The NFC
also set up set up six Sub Groups which are working as per ToRs assigned to them
and it is expected that the working groups would be able to finalize their
recommendations shortly.
00:08Page 19
4.6 The deliberations for new NFC Award are under active consideration. It is
expected that new NFC Award would be announced as soon as the consensus
among all stakeholders is arrived. However, the ongoing 7th NFC Award will remain
operative till a new Award is concluded and implemented.
4.7 The 7th NFC Award has also been given legal cover through President’s Order No.5 of
2010 as amended vide P.O. Order No. 6 of 2015, which are
"PRESIDENT'S ORDER No. 5 of 2010
AN
ORDER
to provide for distribution of revenues and certain grants
WHEREAS in pursuance of clause (1) of Article 160 of the Constitution of the
Islamic Republic of Pakistan hereinafter referred to as the Constitution, the President,
by the Finance Division's Notification No. S.R.O. 739(I)/2005, dated 21st July 2005,
as modified by the said Division's Notification No. S.R.O. 693(I)/2009, dated 24th July
2009, appointed a National Finance Commission to make recommendations, among
other matters, as to the distribution between the Federation and the Provinces of the
net proceeds of certain taxes;
AND WHEREAS the said Commission has also submitted its recommendations
with regard to the said distribution;
NOW, THEREFORE, in pursuance of clauses (4) and (7) of Article 160 of the
Constitution, the President is pleased to make the following Order:-
1. Short title and commencement.- (1) This Order may be called the
Distribution of Revenues and Grants-in-Aid Order, 2010.
(2) It shall come into force on the first day of July, 2010.
2. Definitions.- In this Order, unless there is anything repugnant in the
subject or context, c
(a) "net proceeds" means, in relation to any tax, duty or levy, the proceeds
thereof reduced by the cost of collection as ascertained and certified
by the Auditor General of Pakistan; and
(b) "taxes on income" includes corporation tax but does not include taxes
on income consisting of remuneration paid out of the Federal
Consolidated Fund.
00:08Page 20
3. Distribution of Revenues.-(1) The divisible pool taxes in each year shall
consist of the following taxes levied and collected by the Federal Government in that
year, namely: c
(a) taxes on income;
(b) wealth tax;
(c) capital value tax;
(d) taxes on the sales and purchases of goods imported, exported,
produced, manufactured or consumed;
(e) export duties on cotton;
(f) customs duties;
(g) federal excise duties excluding the excise duty on gas charged at
well-head; and
(h) any other tax which may be levied by the Federal Government.
(2) One percent of the net proceeds of divisible pool taxes shall be assigned to
Government of Khyber Pakhtunkhwa to meet the expenses on war on terror.
(3) After deducting the amounts as prescribed in clause (2), of the balance amount
of the net proceeds of divisible pool taxes, fifty-six percent shall be assigned to
provinces during the financial year 2010-11 and fifty-seven and half percent from the
financial year 2011-12 onwards. The share of the Federal Government in the net
proceeds of divisible pool shall be forty-four percent during the financial year 2010-11
and forty-two and half percent from the financial year 2011-12 onwards.
4. Allocation of shares to the Provincial Governments.-(1) The Province -
wise ratios given in clause (2) are based on multiple indicators. The indicators and
their respective weights as agreed upon are:-
(a) Population 82.0%
(b) Poverty or backwardness 10.3%
(c) Revenue collection or generation 5.0%
(d) Inverse population density 2.7%
00:08Page 21
(2) The sum assigned to the Provincial Governments under Article 3 shall be
distributed amongst the Provinces on the basis of the percentage specified against
each: c
(a) Balochistan 9.09%
(b) Khyber Pakhtunkhwa 14.62%
(c) Punjab 51.74%
(d) Sindh 24.55%
Total: 100.00%
(3) The Federal Government shall guarantee that Balochistan province shall
receive the projected sum of eighty-three billion rupees from the provincial share in
the net proceeds of divisible pool taxes in the first year of the Award. Any shortfall in
this amount shall be made up by the Federal Government from its own resources.
This arrangement for Balochistan shall remain protected throughout the remaining
four years of the Award based on annual budgetary projections.
5. Payment of net proceeds of royalty on crude oil. Each of the provinces
shall be paid in each financial year as a share in the net proceeds of the total royalties
on crude oil an amount which bears to the total net proceeds the same proportion as
the production of crude oil in the Province in that year bears to the total production of
crude oil.
6. Payment of net proceeds of development surcharge on natural gas to
the Provinces.c (1) Each of the Provinces shall be paid in each financial year as a
share in the net proceeds to be worked out based on average rate per MMBTU of the
respective province. The average rate per MMBTU shall be derived by notionally
clubbing both the royalty on natural gas and development surcharge on Gas. Royalty
on natural gas shall be distributed in accordance with clause (1) of Article 161 of the
Constitution whereas the development surcharge on natural gas would be distributed
by making adjustments based on this average rate.
(2) The development surcharge on natural gas for Balochistan with effect from
1st July 2002, shall be re-worked out hypothetically on the basis of the formula given
in clause (1) and the amount, subject to maximum of ten billion rupees, shall be paid
in five years in five equal installments by the Federal Government as grants to be
charged on the Federal Consolidated Fund.
00:08Page 22
7. Grants-in-Aid to the Provinces. There shall be charged upon the
Federal Consolidated Fund each year, as grants-in-aid of the revenues of the province
of Sindh an amount equivalent to 0.66% of the provincial share in the net proceeds of
divisible pool as a compensation for the losses on account of abolition of octroi and zil-
la tax.
8. Sales tax on services.-NFC recognizes that sales tax on services is a
Provincial subject under the Constitution of the Islamic Republic of Pakistan, and may
be collected by respective Provinces, if they so desired.
9. Miscellaneous.-(1) NFC also recommended increase in the rate of excise
duty on natural gas to Rs 10.0 per MMBTU. Federal Government may initiate
necessary legislation accordingly.
(2) The NFC recommended that the Federal Government and Provincial
Governments should streamline their tax collection systems to reduce leakages and
increase their revenues through efforts to improve taxation in order to achieve a 15%
tax to GDP ratio by the terminal year i.e. 2014-15. Provinces would initiate steps to
effectively tax the agriculture and real estate sectors. Federal Government and
Provincial Governments may take necessary administrative and legislative steps
accordingly.
(3) Federal Government and Provincial Governments would develop and
enforce mechanism for maintaining fiscal discipline at the Federal and Provincial
levels through legislative and administrative measures.
(4) The Federal Government may assist the Provinces through specific grants
in times of unforeseen calamities.
(5) The meetings of the NFC may be convened regularly on a quarterly basis
to monitor implementation of the award in letter and spirit.
10. Repeal.- The Distribution of Revenues and Grants-in-Aid Order, 1997
(P.O. No. 1 of 1997), and the Distribution of Revenues and Grants-in-Aid, Order,
2010 (P.O. 4 of 2010) are hereby repealed.
ASIF ALI ZARDARI,
President."
_________
00:08Page 23
“PRESIDENT’S ORDER NO.6 OF 2015
AN
ORDER
To amend Distribution of Revenues and Grants-in-Aid Order, 2010
(President’s Order No. 5 of 2010)
WHEREAS, it is expedient to amend the Distribution of Revenues and Grants-in-Aid
Order, 2010 (P.O.No.5 of 2010), for the purpose hereinafter appearing.
NOW, THEREFORE, in pursuance of Clause (6) read with Clause (7) of Article 160
of the Constitution of the Islamic Republic of Pakistan, the President is pleased to make the
following Order:-
1. Short title and commencement.-(1) This Order may be called the
Distribution of Revenues and Grants-in-Aid (Amendment) Order, 2015.
(2) It shall come into force on the first day of July, 2015.
(3) It will remain in force till further orders.
2. Substitution of Article-4(3) P.O. No.5 of 2010.-In the Distribution of
Revenues and Grants-in-Aid Order, 2010 (P.O.No.5 of 2010), for Article 4(3) the following
shall be substituted, namely:-
(3) The Federal Government shall guarantee that Balochistan province shall
receive the projected sum of eighty-three billion rupees from the provincial
share in the net proceeds of divisible pool taxes in the first year of the
Award and any shortfall in this amount shall be made up by the Federal
Government from its own resources. This arrangement for Balochistan shall
remain protected throughout the Award period based on annual budgetary
projections.
MAMNOON HUSSAIN,
President."
________
00:08Page 24
4.8 In accordance with the framework for distribution of resources structured by the
7th NFC Award, provincial share in federal taxes and straight transfers to Provinces
are estimated at Rs 3,254,526 million for fiscal year 2019-20, reflecting an increase
of 32.2% over revised estimates 2018-19. The details are as in Table-13 below:
TABLE - 13
DETAILS OF PROVINCIAL SHARE IN FEDERAL TAXES
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
A. DIVISIBLE POOL TAXES 2,508,834 2,368,808 3,153,770
- Income Tax 970,673 940,506 1,176,770
- Capital Value Tax 3,684 2,016 2,234
- Sales Tax (Excl. GST on Services) 973,084 863,820 1,206,911
- Federal Excise 144,197 145,529 199,770 (excl. Excise Duty on Natural Gas)
- Customs Duties 417,196 416,938 568,086 (excl. Export Development Surcharge)
B. STRAIGHT TRANSFERS 81,232 93,844 100,756
- Gas Development Surcharge 15,680 5,650 9,800
- Royalty on Natural Gas 35,785 50,200 50,627
- Royalty on Crude Oil 16,490 26,392 24,179
- Excise Duty on Natural Gas 13,277 11,601 16,149
TOTAL (A to B): 2,590,066 2,462,651 3,254,526
PROVINCE- WISE SHARE
Punjab 1,281,980 1,204,738 1,611,364
Sindh 648,813 616,268 814,916
Khyber Pakhtunkhwa 426,095 404,031 533,261 (Inclusive 1% War on Terror)
Balochistan 233,177 237,614 294,983
TOTAL PROVINCIAL SHARE: 2,590,066 2,462,651 3,254,526
00:08Page 25
4.9 Table-14 below presents total net federal transfers to provinces.
TABLE - 14
NET FEDERAL TRANSFERS TO PROVINCES
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
A. Total Transfers to Provinces 2,789,983 2,661,985 3,514,157
- Divisible Pool Taxes 2,508,834 2,368,808 3,153,770
- Straight Transfers 81,232 93,844 100,756
- Special Grants / Subventions 28,000 28,098 96,482
- Project Loans / Grants 137,435 113,989 112,441
- Programme Loans 34,431 52,762 50,663
- Japanese Grant 50 4,485 45
B. Less Payments to Federal Govt. 78,378 94,328 103,483
- Interest Payments 16,782 22,935 24,112
- Loans Repayments 61,596 71,393 79,371
NET TRANSFERS TO PROVINCES (A-B): 2,711,605 2,567,657 3,410,674
4.10 In accordance with the framework for distribution of resources structured by
the 7th NFC Award, the net transfers to provinces are Rs 3,410,674 million in the
budget estimates 2019-20 reflecting an increase of 25.8% and 32.8% over budget
and revised estimates 2018-19 respectively.
00:08Page 26
CHAPTER - 5
CURRENT EXPENDITURE
2019-20
5.1 Table-15 below presents a summary of current expenditure:
TABLE - 15
SUMMARY
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
(i) Mark-up Payment 1,620,230 1,987,319 2,891,449
- Mark-up on Domestic Debt 1,391,000 1,681,564 2,531,685
- Mark-up on Foreign Debt 229,230 305,756 359,764
(ii) Pension 342,000 342,000 421,000
- Military 259,779 259,779 327,088
- Civil 82,221 82,221 93,912
(iii) Defence Affairs and Services 1,100,334 1,137,710 1,152,535
- Defence Services 1,097,949 1,134,501 1,149,665
- Defence Administration 2,385 3,210 2,870
(iv) Grants and Transfers 477,924 478,337 831,194
- Grants to Provinces 28,000 28,098 96,482
- Grants to Others 449,924 450,239 734,712
(v) Subsidies 174,746 254,995 271,500
(vi) Pay and Pension - - 79,000
Vii) Provision for Contingencies - - 115,000
(viii) Running of Civil Government 463,371 460,252 431,246
- Salary 242,742 242,737 241,447
a) Pay 128,011 127,261 121,039
b) Allowance 114,731 115,476 120,408
- Non-Salary 218,129 217,515 187,299
- Others 2,500 - 2,500
CURRENT EXPENDITURE (i to viii) 4,178,605 4,660,613 6,192,924
(xiv) Foreign Loans Repayment 601,754 928,818 1,095,254
TOTAL CURRENT EXPENDITURE
(includes foreign loans repayment) 4,780,359 5,589,431 7,288,179
00:08Page 27
5.2 The main components of current expenditure are mark-up on government
borrowing, defense, running of civil government, pension, grants and subsidies.
Estimates for total current expenditure in the budget for fiscal year 2018-19 were
made at Rs 4,780,358 million, which stood revised upwards to Rs 5,589,431 million.
For fiscal year 2019-20 an allocation of Rs 7,288,179 million has been made for
current expenditure, showing an increase of 52.5% and 30.4% in budget and revised
estimates respectively of the outgoing fiscal year 2018-19.
5.3 Table-16 below presents the comparative position of the budget and revised
estimates of current expenditure for the year 2018-19 along with the budget
estimates 2019-20. It shows breakup of Current Expenditure according to functional
classification.
TABLE - 16
CURRENT EXPENDITURE
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
1) General Public Service 3,340,430 4,048,341 5,607,041
2) Defence Affairs and Services 1,100,334 1,137,711 1,152,535
3) Public Order and Safety Affairs 132,289 133,021 152,919
4) Economic Affairs 80,750 142,440 84,167
5) Environment Protection 1,261 1,271 470
6) Housing and Community Amenities 2,339 2,318 2,292
7) Health Affairs & Services 13,897 13,991 11,058
8) Recreation, Culture and Religion 9,242 10,512 9,838
9) Education Affairs and Services 97,420 97,155 77,262
10) Social Protection 2,396 2,672 190,595
TOTAL: 4,780,359 5,589,431 7,288,179
5.4 The bulk of expenditure falls under General Public Service. The expenditure
against this head has been budgeted at Rs 5,607,041 million for 2019-20, which is
77% of current expenditure.
00:08Page 28
GENERAL PUBLIC SERVICE
5.5 Under the head of General Public Service, the major portion goes to executive
& legislative organs, financial, fiscal and external affairs. At Rs 4,716,758 million, this
component forms 84.1% of the allocation for General Public Service. The main heads
of expenses are Superannuation Allowances & Pensions, Servicing of Domestic
Debt, Foreign Loans Repayment and Others. Transfer payments constitute another
important item.
5.6 The details of expenditures classified under General Public Service are given
in Table-17 below:
TABLE - 17
GENERAL PUBLIC SERVICE
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
GENERAL PUBLIC SERVICE 3,340,430 4,048,341 5,607,041
Executive & Legislative Organs, Financial,
Fiscal Affairs & External Affairs 2,781,312 3,527,477 4,716,758
- Superannuation Allowances & Pensions 342,000 342,000 421,000
- Servicing of Foreign Debt 229,230 305,756 359,764
- Foreign Loans Repayment 601,754 928,818 1,095,254
- Servicing of Domestic Debt 1,391,000 1,681,564 2,531,685
- Others 217,329 269,340 309,055
Foreign Economic Aid 4,762 6,069 6,422
Transfers 477,924 478,337 643,391
General Services 7,027 6,964 9,805
Basic Research 5,438 5,356 4,992
Research and Development General Public
Services 13,072 12,951 14,417
Administration of General Public Services 2,531 2,455 6,846
General Public Services not elsewhere
defined 48,365 8,732 204,410
00:08Page 29
DEFENCE AFFAIRS AND SERVICES
5.7 Details of estimates of expenditure on Defence Affairs and Services in
2018-19 (budget & revised) and 2019-20 (budget) are given in Table-18 below:
TABLE - 18
DEFENCE AFFAIRS AND SERVICES
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
DEFENCE AFFAIRS AND SERVICES 1,100,334 1,137,711 1,152,535
- Defence Administration 2,385 3,210 2,870
- Defence Services 1,097,949 1,134,501 1,149,665
- Employees Related Expenses 422,911 427,034 450,413
- Operating Expenses 253,467 286,631 264,656
- Physical Assets 282,328 279,400 315,375
- Civil Works 141,293 143,487 123,252
- Less Recoveries -2,051 -2,051 -4,031
00:08Page 30
PUBLIC ORDER AND SAFETY AFFAIRS
5.8 Under the head of Public Order and Safety Affairs, an amount of
Rs 152,919 million has been provided in the budget 2019-20 as compared with Rs
132,289 million in the budget estimates 2018-19 and Rs 133,021 million in revised
estimates of the outgoing fiscal year 2018-19. The allocation for Police (Rs 142,837
million) forms the major component, with a share of 93.4%, in the total allocation
under this head. Table-19 below provides the details:
TABLE - 19
PUBLIC ORDER AND SAFETY AFFAIRS
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
PUBLIC ORDER AND SAFETY AFFAIRS 132,289 133,021 152,919
- Law Courts 5,631 5,578 6,012
- Police 122,974 123,689 142,837
- Fire Protection 293 287 274
- Prison Administration and Operation 53 51 43
- R & D Public Order and Safety 36 35 47
- Administration of Public Order 3,302 3,381 3,706
00:08Page 31
ECONOMIC AFFAIRS
5.9 The allocation under the head of Economic Affairs in the budget 2019-20 has
been projected at Rs 84,167 million, as compared with Rs 80,750 million in the
budget estimates 2018-19 and Rs 142,440 million in revised estimates 2018-19.
Major share of this head goes to Fuel and Energy is 29.4% of total allocation for
Economic Affairs. Table-20 below provides the details under this head:
TABLE - 20
ECONOMIC AFFAIRS
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
ECONOMIC AFFAIRS 80,750 142,440 84,167
- General Economic, Commercial and
Labour Affairs 26,306 58,113 32,580
- Agriculture, Food, Irrigation, Forestry
and Fishing 31,188 30,476 4,917
- Fuel and Energy 709 26,690 24,718
- Mining and Manufacturing 1,773 6,461 1,811
- Construction and Transport 15,564 15,604 14,753
- Communications 3,461 3,452 3,714
- Other Industries 1,749 1,643 1,674
00:08Page 32
ENVIRONMENT PROTECTION
5.10 Under the head of Environment Protection, an amount of Rs 470 million has
been estimated for budget 2019-20 for Waste Water Management, which is lower by
62.7% than budget estimates 2018-19.
TABLE - 21
ENVIRONMENT PROTECTION
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
ENVIRONMENT PROTECTION 1,261 1,271 470
Waste Water Management 1,261 1,271 470
HOUSING AND COMMUNITY AMENITIES
5.11 Under the head of Housing and Community Amenities, an amount of
Rs 2,292 million has been provided in the budget 2019-20 for Community
Development, as compared with Rs 2,339 million in the budget estimates
2018-19 and Rs 2,318 million in revised estimates 2018-19.
TABLE - 22
HOUSING AND COMMUNITY AMENITIES
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
HOUSING AND COMMUNITY AMENITIES 2,339 2,318 2,292
Community Development 2,339 2,318 2,292
00:08Page 33
HEALTH AFFAIRS AND SERVICES
5.12 Under the head of Health Affairs and Services, a total allocation of Rs 11,058
million has been made in the budget estimates 2019-20, which is lower by 20.4%
from the budget estimates 2018-19. The allocation for Hospital Services forms the
major component, which is 78.7% under this classification. Details are given in Table-
23 below:
TABLE - 23
HEALTH AFFAIRS AND SERVICES
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
HEALTH AFFAIRS AND SERVICES 13,897 13,991 11,058
- Medical Products, Appliances and
Equipment 31 31 31
- Hospital Services 11,657 11,820 8,702
- Public Health Services 469 465 463
- Health Administration 1,740 1,675 1,862
00:08Page 34
RECREATION, CULTURE AND RELIGION
5.13 In budget 2019-20 an amount of Rs 9,838 million has been budgeted for
Recreation, Culture and Religion. Overall estimates under this classification for 2019-
20 are higher by 6.4% when compared with budget estimates 2018-19, and lower by
6.4% when compared with revised estimates 2018-19. The bulk of expenditure under
this head has been earmarked for Broadcasting and Publishing, which is 77.6% of
the total allocation. Details are given in Table-24 below:
TABLE - 24
RECREATION, CULTURE AND RELIGION
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
RECREATION, CULTURE AND RELIGION 9,242 10,512 9,838
- Recreation and Sporting Services 1 1 0.4
- Cultural Services 681 680 717
- Broadcasting and Publishing 7,091 7,628 7,631
- Religious Affairs 1,032 1,765 1,050
- Administration of Information,
Recreation & Culture 437 437 439
00:08Page 35
EDUCATION AFFAIRS AND SERVICES
5.14 Education Affairs and Services have been provided with Rs 77,262 million in
the budget estimates 2019-20 as compared with Rs 97,420 million in budget
estimates 2018-19 and Rs 97,155 million in revised estimates 2018-19. The bulk of
expenditure at Rs 65,233 million has been allocated for Tertiary Education Affairs
and Services in budget 2019-20, which is 84.4% of the total allocation under this
head. The details are as under:
TABLE - 25
EDUCATION AFFAIRS AND SERVICES
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
EDUCATION AFFAIRS AND SERVICES 97,420 97,155 77,262
- Pre-Primary & Primary Education Affairs
Services 10,120 10,120 2,831
- Secondary Education Affairs & Services 12,365 12,358 6,718
- Tertiary Education Affairs and Services 71,824 71,743 65,233
- Education Services not Definable by Level 77 0 0
- Subsidiary Services to Education 295 283 310
- Administration 1,588 1,565 1,407
- Education Affairs, Services not
elsewhere classified 1,151 1,085 763
00:08Page 36
SOCIAL PROTECTION
5.15 Under the head of Social Protection, an amount of Rs 190,595 million has
been allocated in the budget 2019-20, which is eighty (80) times more than the
budget estimates 2018-19.
TABLE - 26
SOCIAL PROTECTION
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
SOCIAL PROTECTION 2,396 2,672 190,595
- Administration 1,616 1,903 1,827
- Others 780 769 864
- Social Protection (not elsewhere class) 0 0 187,904
00:08Page 37
CHAPTER - 6
SUBSIDIES, GRANTS AND TRANSFERS
2019-20
SUBSIDIES
6.1 In order to alleviate the impact of inflation on citizens, especially the poor
segments of society, the Federal Government spends a fairly large sum on providing
power and food subsidies. In the budget estimates 2018-19 subsidies were Rs 174,746
million; in revised estimates 2018-19 they increased to Rs 254,995 million due to grant of
subsidy to DISCO & KESC on account of support package for industrial customers and
also due to increase in subsidy to WAPDA/PEPCO. Total subsidies for fiscal year 2019-
20 have been estimated at Rs 271,500 million which increased by 55.4% and 6.5% over
budget estimates and revised estimates respectively of 2018-19.
6.2 In budget 2019-20, the allocation for subsidies to WAPDA/PEPCO forms the
major component, which is 70.3% of the total allocation followed by subsidy to KESC
with share of 21.9%, USC with share of 2% and PASSCO with share of 5.7%. Table-27
provides the details:
TABLE - 27
SUBSIDIES
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
Subsidy to WAPDA/PEPCO: 134,000 189,860 191,000
1 Inter-Disco Tariff Differential 105,000 130,000 162,000
2 Tariff Differential for Agriculture Tubewells in
Balochistan 5,000 4,860 8,000
3 To pick up WAPDA/PEPCO receivables from
merged districts of KPK 12,000 12,000 18,000
4 Subsidy to WAPDA on account of Tariff
Differential for AJ&K 12,000 43,000 3,000
C o n t
00:08Page 38
SUBSIDIES
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
Subsidy to KESC: 15,400 40,540 59,500
5 To pick up KESC's Tariff Differential 15,000 15,000 25,000
6 For Tariff Differential for Agriculture
Tubewells in Balochistan 400 540 500
7 Subsidy to DISCOs & K-Electric 0 25,000 -
8 To KESC for industrial support package - - 10,000
9 Subsidy to LNG sector for providing Gas on - - lower rates to industry 24,000
Subsidy to USC: 6,000 6,001 5,500
10 Ramzan Package 2,000 1,538 2,500
11 Payment of Sugar Arrears 3,000 3,000 3,000
12 Sale of Pulses, Rice, Tea etc. at subsized - rates 1,000 1,463
Subsidy to PASSCO for: 19,045 18,294 15,500
13 Wheat Operation 1,500 1,500 2,000
14 Wheat Reserved Stock 5,000 5,000 5,000
15 Wheat supplied to Gilgit-Baltistan (Arrears) 8,045 7,294 8,000
16 Support for Wheat/Flour Export 1,500 1,500 -
17 Support for Sugar Export 2,000 2,000 -
18 Reimbursement on account of Paddy - Operation 500 500
19 Reimbursement on account of Donation of
Wheat by the GOP 500 500 500
Subsidy to National Food Security &
Research Division 1 - -
22 National Food Security & Research Division 1 - -
Subsidy to Others: 300 300 -
23 Sale of Wheat in FATA 300 300 -
TOTAL SUBSIDIES: 174,746 254,995 271,500
00:08Page 39
GRANTS AND TRANSFERS
6.3 Grants and transfers to provinces and others for the year 2019-20 have been
estimated at Rs 831,194 million as compared with Rs 477,924 million in budget
estimates 2018-19 and Rs 478,337 million in revised estimates. The detail of grants
and transfers to the provinces and others is given in the following Table:
TABLE - 28
GRANTS AND TRANSFERS
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
I. GRANTS IN AID & MISCELLANEOUS 28,000 28,098 96,482
ADJUSTMENTS
A. SPECIAL GRANTS 24,000 28,098 86,482
- Punjab - 1,900 -
- Sindh 14,000 16,030 20,400
- Khyber Pakhtunkhwa - 160 56,082
- Balochistan 10,000 10,008 10,000
B. LUMP PROVISION 4,000 - 10,000
II. GRANTS TO OTHERS 449,924 450,239 734,712
- Contingent Liabilities 210,000 210,000 308,000
- Miscellaneous Grants 77,000 77,000 84,000
- Other outstanding Liabilities 20,000 20,000 -
- Pakistan Railways to meet their losses 37,000 37,000 39,000
- National Internship Programme 53 52 54
- Lump Provision for Relief etc. 4,096 4,096 3,000
Contd…
00:08Page 40
GRANTS AND TRANSFERS
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
- Competition Commission of Pakistan 210 210 210
- Reimbursement of Telegraphic
Transfers (TT) Charges on Home 12,000 11,900 15,000
Remittances
- Pakistan Remittance Initiative 20 120 100
- Audit Oversight Board - 20 35
- FWBL's Key Initiatives/Development - - 500
- Public Private Partnership Authority- - - 75 PPPA
- Walled Accounts - - 1,000
- Remmitances - - 2,000
- Grants to AJK Government 49,000 49,210 54,890
- Grant-in-Aid to Gilgit Baltistan 29,500 29,512 33,000
- Grant to Bait-ul-Maal 5,000 5,000 5,653
- Wheat Subsidy to Gilgit Baltistan 6,045 5,367 6,045
- Grant to Pakistan Textile City Ltd. - 14 -
- Grant to Pakistan Machine Tool Factory - 737 -
Benazir Income Support Programme - - 180,000
Pakistan Poverty Alleviation Fund - - 2,150
TOTAL GRANTS (I + II): 477,924 478,337 831,194
00:08Page 41
CHAPTER - 7
LOANS AND INVESTMENTS
2019-20
7.1 The financial assets of the Federal Government consist of investible funds and
loans provided to Azad Jammu and Kashmir (AJK) and various agencies/institutions
as well as government servants to enable them to meet their financial requirements.
CURRENT LOANS & ADVANCES
7.2 Total current loans and advances have been estimated at Rs 61,523 million in
budget 2019-20. The following Table provides the details:
TABLE - 29
CURRENT LOANS & ADVANCES
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
1 Ways & Means Advances to the Govt.
AJK for repayment of principal & interest 14,494 14,494 17,080
2 Junagadh and Kathiawar Chiefs 1 23 21
3 Loans/Advances to Employees of PNRA 15 15 15
4 Loans/Advances to Friendly Countries 500 500 500
5 Gilgit-Baltistan for Repayment of
Principal and Interest 6 - -
6 Interest free Loans to WAPDA
Operation and Maintenance, Hub Dam &
Khanpur Dam 40 - 40
8 Loan to State Engineering Corporation 20 20 20
9 Current Loans to PIA 18,000 19,628 24,525
10 Loans and Advances to Governments
Servants 12,000 11,985 14,522
11 Loans to Pakistan Steel Mills Karachi 4,000 6,515 4,800
12 Loan to Pakistan Machine Tool Factory - 96 -
TOTAL: 49,076 53,275 61,523
00:08Page 42
DEVELOPMENT LOANS AND ADVANCES
7.3 Development loans and advances are made by the Federal Government to
Provinces, Government of Azad Jammu and Kashmir, Public Sector Enterprises
(PSEs), Financial/Non-Financial Institutions, District Governments/TMAs, and Others
to assist them in carrying out their development programmes.
7.4 Total development loans and advances (local and external) were estimated
at Rs 461,539 million in the budget 2018-19, which have now been revised upwards
to Rs 550,709 million in revised estimates 2018-19. For budget 2019-20, total
development loans and advances have been estimated at Rs 406,448 million,
showing a decrease of 11.9% over budget estimates 2018-19 and 26.2% over
revised estimates 2018-19.
7.5 For budget 2019-20, development loans and advances (local) have been
estimated at Rs 136,113 million, while development loans and advances (external) at
Rs 270,335 million. The details are as in Table-30 below:
TABLE - 30
DEVELOPMENT LOANS AND ADVANCES
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
1 Development Loans and Advances 156,315 140,156 136,113
2 External Development Loans and
Advances 305,225 410,553 270,335
TOTAL: 461,539 550,709 406,448
00:08Page 43
CURRENT INVESTMENTS
7.6 The federal current investments for the year 2019-20 have been estimated at
Rs 15,468 million as compared with Rs 19,436 million and Rs 7,537 million in the
budget and revised estimates of 2018-19 respectively. The allocation for investment
in 2019-20 is higher by 105.2% as compared with revised estimates 2018-19. Table-
31 provides the comparative position.
TABLE - 31
CURRENT INVESTMENTS
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
1 GoP Contribution in Equity of Pak China
Investment Co. Ltd. Islamabad 500 500 500
2 GoP Equity injuction in Sarmaya-e-
Pakistan Ltd - 100.0 200
3 Fifth General Capital Increase of Aisian
Development Bank - - 0.1
4 Lump Provision for Miscellaneous
Expenditure 11,000 - -
5 Paid up Capital for the proposed Exim
Bank of Pakistan 1,000 - 2,000
6 4th General Increase of Capital Stock
Islamic Develoment Bank (IDB) 933 933 1,264
7 Pakistan Mortgaauge Refinance
Company Ltd. PMRCL - - 5,000
8 GoP Equity in DISCOs through PHPL for
payment of DSL of STFF 6,000 6,000 6,000
9 Pakistan's Annual Contribution to Inter
Governmental Group IF 24 (G-24) 3 4 4
10 International Financial Institutions GOP
contribution in equity of Pak-Libya
Holding Company Limited - - 500
TOTAL: 19,436 7,537 15,468
00:08Page 44
CHAPTER - 8
PUBLIC SECTOR DEVELOPMENT PROGRAMME (PSDP) 2019-20
8.1 The Public Sector Development Programme (PSDP) is the main instrument for
improving the socio-economic conditions in the country and achieving the
macroeconomic and development objectives and targets set by the government,
which yield maximum benefits in the shortest possible time for the society.
8.2 For the year 2019-20 National Economic Council (NEC) has approved an
overall size of PSDP at Rs 1,613 billion, which is 3.7% of Gross Domestic Product
(GDP).
8.3 The Salient features of PSDP allocation for 2019-20 are as follows:
- The size of national PSDP estimated in the budget for 2019-20 showing an
increase of 34.4% over revised estimates 2018-19.
- Federal PSDP for the year 2019-20 has been kept at Rs 701 billion, which is
higher by 40.2% than revised estimates 2018-19.
- The share of Federal Ministries/Divisions in 2019-20 PSDP is Rs 348.2 billion
indicating an increase of 43.2% over revised estimates 2018-19.
- The Corporations' PSDP for 2019-20 has been placed at Rs 197.8 billion.
- An amount of Rs 24 billion has been allocated in the budget 2019-20 to Pakistan
Sustainable Development Goals (SDGs) and Community Development
Programme.
- Earthquake Rehabilitation and Reconstruction Authority (ERRA) has been
allocated Rs 5 billion in the budget 2019-20.
- In the budget 2019-20, an amount Rs 17 billion has been allocated to Relief and
Rehabilitation of IDPs.
- An amount of Rs 53 billion has been budgeted for Security Enhancement in
2019-20.
- Rs 5 billion has been allocated for Prime Minister's Youth skill Development
Initiative in the budget 2019-20.
- Gas Infrastructure Development Cess (GIDC) has been allocated Rs 1.0 billion
in the budget 2019-20.
00:08Page 45
- The Provincial Development Programme for 2019-20 has been estimated at
Rs 912 billion as against Rs 700 billion in revised estimates 2018-19, showing
an increase of 30.3%.
8.4 The following Table-32 indicates details of the size of Public Sector Development
Programme (PSDP).
TABLE - 32
SIZE OF PSDP
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
A. Federal Ministries/Divisions 420,375 243,141 348,240
1 Aviation Division 4,677 1,592 1,267
2 Board of Investment 125 77 100
3 Cabinet Division 1,116 100 15,986
4 Capital Administration & Development
Division 13,906 - -
5 Climate Change Division 803 71 7,579
6 Commerce Division 1,500 - 100
7 Communications Division (other than
NHA) 14,481 151 248
8 Defence Division 641 171 456
9 Defence Production Division 2,810 1,630 1,700
10 Economic Affairs Division 70 - -
11 Establishment Division 175 1 333
12 Federal Education & Professional
Division 4,337 3,439 4,797
13 Finance Division 16,951 13,509 36,822
14 Foreign Affairs Division 200 - 30
15 Higher Education Commission 35,830 21,465 29,047
16 Housing & Works Division 5,433 4,069 2,930
17 Human Rights Division 300 1 143
18 Industries and Production Division 1,775 685 2,343
Contd…
00:08Page 46
SIZE OF PSDP
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
19 Information & Broadcasting & National
Heritage Division 1,644 226 516
20 Information Tech. & Telecom Division 3,046 863 7,342
21 Inter Provincial Coordination Division 3,553 2,064 340
22 Interior Division 24,008 10,540 9,848
23 Kashmir Affairs & Gilgit Baltistan
Division 44,706 41,465 44,699
i. AJK 26,377 26,481 26,894
ii. Gilgit Baltistan 18,329 14,984 17,805
24 Law and Justice Division 1,025 556 1,340
25 Maritime Affairs Division 10,119 2,455 3,600
26 Narcotics Control Division 251 73 135
27 National Food Security & Research
Division 1,808 578 12,048
28 National Health Services, Regulations &
Coordination Division 25,034 8,133 13,377
29 National History & Literary Heritage
Division 551 80 128
30 Pakistan Atomic Energy Commission 28,340 22,711 24,457
31 Pakistan Nuclear Regulatory Authority 300 264 301
32 M/o. Energy (Petroleum Division) 943 463 582
3233 Planning, Development & Reform
Division 16,240 4,503 7,964
34 Postal Services Division 370 - -
35 Poverty Alleviation and Social Safety Div. - - 200
36 Railways Division 34,411 22,793 16,000
37 Religious Affairs & Interfaith Harmony - - 1,000
38 Revenue Division 2,559 1,408 1,818
39 Science & Technological Research
Division 3,900 695 7,407
40 States & Frontier Regions Division 28,256 31,874 -
Contd…
00:08Page 47
SIZE OF PSDP
(Rs in Million)
Budget Revised Budget
Classification
2018-19 2018-19 2019-20
41 Statistics Division 200 - -
42 SUPARCO 4,700 6,477 6,033
43 Textile Division 280 62 203
44 Water Resources Division 79,000 37,895 85,021
B. Corporations 246,125 211,433 197,759
1 National Highway Authority (NHA) 210,000 190,150 155,967
2 NTDC/PEPCO/WAPDA 36,125 21,283 41,792
C. ERRA 8,500 6,500 5,000
D. Relief and Rehabilitation of IDPs 45,000 4,720 17,000
E. Security Enhancement 45,000 - 53,000
F. Prime Minister's Youth Skill Dev. Initiative 10,000 - 5,000
G. Clean Green Pakistan Movement/ Tourism - - 2,000
H. Gas Infrastructure Development Cess 5,000 208 1,000
I. Merged Areas of FATA 10 Years
Development Plan 10,000 10,000 48,000
J. Special Provision for CEPEC Projects 5,000 - -
K. Pak SDGs & Community Development
Programme 5,000 24,000 24,000
Total Federal PSDP (A to K): 800,000 500,000 701,000
L Provinces 850,000 700,000 912,000
TOTAL NATIONAL PSDP (A to L): 1,650,000 1,200,000 1,613,000
00:08Page 48
DEVELOPMENT EXPENDITURE OUTSIDE PSDP 2019-20
8.5 Under the head of Development Expenditure Outside Public Sector Development
Programme, an amount of Rs 85,791 million has been allocated in this head in the
budget 2019-20, reflecting an increase of 47.3% over budget estimates 2018-19 and
52.2% over revised estimates 2018-19. Table-33 provides the details.
TABLE - 33
DEVELOPMENT EXPENDITURE OUTSIDE PSDP
(Rs in Million)
Budget Revised Budget
Classification 2018-19 2018-19 2019-20
1 Benazir Income Support Programme 124,700 118,666 -
2 Crop Loan Insurance Scheme 1,000 1,000 1,000
3 Livestock Insurance Scheme 100 100 500
4 Credit Guarantee Scheme for Small Farmers 100 - 100
5 Provision for Reconstruction of Afghanistan 3,000 3,000 5,000
6 Subsidy to TCP for Import of Urea Fertilizer 5,000 5,000 5,000
7 Provision for Misc. Dev. Exp. (elections) 18,000 - 8,350
8 Grants for Pakistan Poverty Alleviation Fund 688 688 -
9 Public Financial Management & Accountability
to support services delivery programme 150 - 2,000
10 Prime Minister's Interest Free Loan (PMIFL) 3,500 - -
11 Strategic Trade Policy Framework 4,000 - -
12 Textile Policy 2009-14 6,000 - -
13 Duty drawback of local taxes and levies 2014-15 - 46 -
14 Local Taxes and Levies 2015-16 - 504 -
15 Local Taxes and Levies 2015 - 8 -
16 Duty Drawback of Taxes Order 2016-17 10,000 5,712 35,000
17 Drawback of Local Taxes and Levies
(Non-Textile) Order, 2017 4,000 1,955 -
18 Duty drawback local taxes & levies 2016-17 - 630 -
19 Duty Drawback of Taxes Order 2017-18 - 15,145 -
20 Public Management and Accountability to
Support Service Delivery Program (PFR)
Performance incentive to progress - - 4,000
21 SME Landing Program - - 450
22 Export package strategic trade policy - - 5,000
23 National Disaster Risk Management fund - - 1,000
24 TDPs (ERPs) - - 3,866
25 Low cast housing scheme - - 5,000
26 PM Kamyab Jawan Programme - - 450
27 Development Exp. Of EAD outside PSDP - 3,081 8,366
28 Development Exp. Of FATA outside PSDP - 11,860 -
29 Others - 709
TOTAL: 180,238 162,929 85,791
00:08Page 49
CHAPTER - 9
MEDIUM-TERM BUDGETARY FRAMEWORK (MTBF)
9.1 Medium-Term Budgetary Framework (MTBF) reform initiative is aimed at improving
budget preparation process of the Federal Government. Since its full rollout, endorsed by
the Cabinet in 2009, this reform initiative has made steady progress.
9.2 The MTBF includes the following key components:
(1) An annual pre-budget analytical ‘Budget
Strategy Paper’, which includes a 3-
year macro-fiscal framework, budget policies, and indicative ceilings (resource
limits) for Ministries / Divisions. The Budget Strategy Paper is tabled in the Cabi-
net meeting where discussions on policy priorities, allocations, and performance
against targets are held.
To compile the Budget Strategy Paper, the Finance Division, Planning Commis-
sion, Federal Board of Revenue, and State Bank of Pakistan share their projec-
tions and discuss different scenarios and options.
This component has led to greater coordination between technical and political
levels of the Government in defining fiscal policy and benchmarks, and
enhanced understanding of medium-term implications of current budgetary
decisions.
(2) Performance budgeting (also known as ‘output-based budgeting’). Through
this mechanism the Principal Accounting Officers (Secretaries) are gradually be-
ing given greater autonomy over the distribution of ceilings as per their own policy
priorities. Together with greater autonomy, a system of performance management
is being introduced, which presents the budget by outputs (services delivered) as
against inputs only (funding and material resources required).
The output-orientation to the budget allows linkage of the budget with policy
preferences, and provides a basis for defining and measuring performance.
Through the use of mutually agreed indicators and targets, each Principal
Accounting Officer is given a set of criteria against which the performance of the
Ministry/Division is evaluated in terms of outputs generated from the utilisation of
budgetary resources appropriated by the Parliament.
This information is then presented to the Parliament in the shape of ‘Federal Medium-
Term Budgetary Estimates for Service Delivery’- also known as the MTBF Green Book. The
Green Book is a part of the reform agenda to make the budget more transparent and compre-
hensive by linking budgetary allocations with policy and performance.
00:08Page 50
(3) Performance monitoring. The performance budgets prepared are being
monitored by the Finance Division. Under this process, actual expenditure
against appropriations and reasons for variations are compiled from Ministries /
Divisions along with performance achieved vs targets.
Budget Preparation Process
9.3 To achieve the objectives as outlined above, the Federal Government has improved
its budget preparation process through the MTBF. Under the reformed process:
{ The Finance and Planning, Development Reform Divisions prepare a
Medium-Term Macroeconomic Framework in consultation with various
Government Ministries and the State Bank of Pakistan
{ Based on the macroeconomic situation and future projections, the Finance
Division articulates its budgetary policy priorities and prepares a Medium-
Term Fiscal Framework
{ The Finance Division and Planning, Development & Reforms Division work
out, for each Principal Accounting Officer, medium-term Indicative Budget
Ceilings (IBCs) that align resource allocation with the Government’s policies
{ The macroeconomic and fiscal frameworks, together with the IBCs, are
presented to the Cabinet through the 'Budget Strategy Paper' (BSP) for
approval
{ Based on these IBCs, ministries prepare their budgets that are reviewed for
quality assurance by the Finance Division and Planning, Development and
Reform Division
{ The Secretaries of Finance, Planning, Development and Reform, and
Economic Affairs Divisions jointly chair the Priorities Committee meetings
that discuss policy and budget priorities with each Principal Accounting
Officer
{ The Annual Plan Coordination Committee (APCC) discusses the public-
sector investment proposals with the Federal and Provincial Governments
{ The National Economic Council (NEC) approves the Public Sector
Development Programme (PSDP) of the Federal and Provincial
Governments
{ The finalised budget is presented in the Cabinet for endorsement and
Parliament for appropriation.
00:08Page 51
MACROECONOMIC INDICATORS
9.4 Macroeconomic Indicators for 2018-22 are provided in Table - 34 below:
TABLE - 34
ForecastConsolidated Fiscal Budget Revised Budget
Projections 2018-19 2018-19 2019-20 2020-21 2021-22
Real GDP Growth (%) 6.2 3.3 2.4 3.0 4.5
Inflation (%) 6.0 7.2 11-13 8.3 6.0
(as percentage of GDP)
Total Revenue 16.3 14.5 16.7 18.3 19.2
- Tax Revenue 13.9 12.6 14.4 16.0 17.0
- FBR Tax Revenue 11.6 10.8 12.6 14.2 15.1
- Non Tax Revenue 2.4 1.9 2.3 2.3 2.2
Total Expenditure 21.2 21.7 23.8 23.4 22.8
- Current 16.5 18.3 20.2 19.7 19.0
- Development 4.7 3.4 3.6 3.7 3.8
Fiscal Balance -4.9 -7.2 -7.1 -5.1 -3.6
Revenue Balance -0.2 -3.8 -3.6 -1.4 0.2
Total Public Debt-
(Gross) 68.0 77.7 77.6 75.2 70.6
Total Public Debt-(Net) 63.3 72.0 73.0 71.3 67.3
GDP at market prices 38,388 38,559 44,003 49,568 55,380
(Billions)
00:08Page 52
WORKING OF FISCAL DEFICIT AND FINANCING
BUDGET 2019-20
(Rs. in Billion)
Working Deficit Financing of Deficit
A) Federal Revenue (net) 3,462 Gross External Loans 3,032
B) Total Federal 7,022 Less Repayments 1,204
Expenditure (i+ii)
i) Current Expenditure 6,193 Long Term Foreign Loans 1,095
ii) Development and Net 829 Short Term Foreign Loans 108
Lending (a+b+c)
a) Federal PSDP 701 i) Net External Financing 1,829
b) Other Development 80 ii) Domestic Financing
Expenditure (a+b+c) 1,308
c) Net Lending 48 a) Bank Financing 339
C) Federal Deficit (A-B) -3,560 b) Non Bank Financing 819
Estimated Provincial Surplus 423 Public debt 583
Public Account 237
c) Privatization Proceeds 150
Overall Fiscal Deficit -3,137 Total Financing of Deficit (i+ii) 3,137
% of GDP -7.1% % of GDP 7.1%Page 53
BUDGET AT A GLANCE
FOR THE FISCAL YEAR 2019-20
(Rs. in Billion)
RECEIPTS EXPENDITURE
TAX REVENUE 5,822 A. CURRENT 6,193
- FBR Taxes 5,555 Interest Payments 2,891
- Other Taxes 267 Pension 421
- NON-TAX REVENUE 894 Defence Affairs & Services 1,153
a) Gross Revenue Receipts 6,717 Grants and Transfers 831
b) Less Provincial Share 3,255 Subsidies 272
I. Net Revenue Receipts (a-b) 3,462 Running of Civil Govt. 431
II. Capital Receipts (Non-Bank) 819 Provision for Pay & Pension 79
Provision for Contingencies 115
III. External Receipts (net) 1,829 B. DEVELOPMENT 829
IV. Estimated Provincial Surplus 423 Federal PSDP 701
V. Bank Borrowing 339 Net Lending 48
VI. Privatization Proceeds 150 Other Dev. Expenditure 80
TOTAL RESOURCES (I to VI) 7,022 TOTAL EXPENDITURE(A+B) 7,022Page 54
Glossary of Terms
Bank Borrowing Includes borrowing from the State Bank of
Pakistan and Scheduled Banks
Capital Receipts Income from proceeds of borrowing, money
received in repayment of loans, recoveries of
advances and investments, proceeds of
savings schemes, net receipts from
transactions under deposit, and remittances
Community Services Income from rents of government buildings,
Receipts land, guest houses, and hostels, etc.
Current Expenditure Include interest payments, pension, defence
affairs & services, grants & transfers,
subsidies, and running of civil government
Development Expenditure Include federal PSDP, development loans &
grants to provinces, and other development
expenditure (outside PSDP)
Direct Taxes Income tax, workers welfare fund and capital
value tax (CVT)
Disbursements Government investments, loans, advances
and others, and repayment of short term credit
External Resources Include project and programme loans, foreign
loans & credits, and foreign grants
Grants Financial support to provinces, organisations,
and industries for contingent liability, to fulfill
losses, remission of loans, etc.
Gross Revenue Receipts Sum of tax revenue and non-tax revenue
(before excluding provincial share)
Indirect Taxes Customs, sales tax and federal excise.
Contd…Page 55
Glossary of Terms
Internal Resources Include net revenue receipts, net capital
receipts, and estimated provincial surplus
Net Capital Receipts Capital receipts minus disbursements
Net Lending to Others Government investments, loans and advances
from Public Sector Enterprises (PSEs) minus
recoveries of loans and advances from PSEs
Net Revenue Receipts Gross revenue receipts minus provincial share
Non-Tax Revenue Income from property and enterprises; receipts
from civil administration and other functions;
and miscellaneous receipts of the federal
ministries, divisions and departments
Other Development Other development expenditure comprises
Expenditure development expenditure of Federal
Government outside the PSDP
Other Taxes Islamabad Capital Territory (ICT) Tax, Airport
Tax, Gas Infrastructure Development Cess
(GIDC), Natural Gas Development Surcharge
and Petroleum Levy.
Provincial Share Provincial share in federal taxes and straight
transfers
Provincial Surplus Provincial government deposits with State
Bank of Pakistan
Resources Include internal and external financial
resources
Tax Revenue Income from direct, indirect and other taxes
Total Outlay / Expenditure Includes current expenditure and development
expenditure