Peshawar - Khyber Pakhtunkhwa on Wednesday took another historic lead when its government not only approved the establishment of a Debt Management Fund but formulated and approved Rules for it too.
The Provincial Cabinet, which met here today under the chairmanship of Chief Minister Ali Amin Gandapur, also approved the filing of a constitutional petition in the Supreme Court of Pakistan against the proposed Constitutional amendment by the Federal Government.
In view of the fact that surging debt servicing costs and the adverse impact of depreciation of Pak Rupee, this fund is essential to manage the province’s debt obligations effectively and ensure financial sustainability.
Invoking Section 36 (1) of the Khyber Pakhtunkhwa Public Financial Management Act, 2022, the finance department has devised the creation of the Debt Management Fund for long-term economic stability. The approval of this initiative will be instrumental in safeguarding the province’s financial future.
The Debt Management Fund will invest unutilized balances from the Government Treasury into low-risk instruments. The Fund shall not only create a revenue source that offsets growing debt obligations but also result in optimal cash management, ensuring the province can better manage its financial obligations and that substantial fiscal space is available to prioritize expenditure on service delivery.
The draft Khyber Pakhtunkhwa Debt Management Fund Rules, 2024, for governing the control, management, utilization, and oversight of the proposed Debt Management Fund were also approved during the meeting.
Meanwhile, the provincial cabinet formally expressed regret over the Ministry of Poverty Alleviation & Social Safety Pakistan’s offer/decision to obtain a US $118.4 million loan from the Islamic Development Bank for the “Poverty Graduation of Extremely Poor & Flood Affected Households Project” in Khyber Pakhtunkhwa. This decision was made in light of Khyber Pakhtunkhwa’s current debt burden and the availability of alternative funding sources that offer lower costs and more favorable terms.
With regard to the filing of a constitutional petition against the proposed constitutional amendment in the Supreme Court of Pakistan, the cabinet held that the parliament, i.e., both the national assembly and the Senate, were incomplete at the moment because the PTI has not been given its reserved seats. Hence, no constitutional amendment of such important implications could be enacted.
The Provincial cabinet also approved policy guidelines for Khyber Pakhtunkhwa’s participation in the carbon market. Key points of agreement include a 5% deduction at source for Nationally Determined Contributions (NDCs); a Correspondent Adjustment Fund (CAF), in which 12% of net revenues generated from carbon credit sales will be allocated. Of this, 50% will be transferred to the province where the project is based, and the remaining 50% will go to the Pakistan Climate Change Fund or other climate initiatives across the country in consultation with the province. Additionally, 1% administrative costs will be charged by the Ministry of Climate Change, subject to endorsement by other provinces.
The provincial cabinet approved a recurring grant of Rs 1.5 billion for public sector universities in Khyber Pakhtunkhwa. Since 2018, the Higher Education Commission’s (HEC) annual grants to universities in the province have been frozen. Following the 18th amendment, higher education has become a provincial responsibility, requiring the province to independently fund its universities.
Despite substantial efforts over the past four years to increase self-generated income, achieving 84.5% growth, the revenue generated internally remains inadequate to meet the rising financial demands of the universities. Older universities, in particular, are grappling with unresolved liabilities related to pensions and salaries.
The cabinet also approved the constitution of an academic search committee for the appointment of vice chancellors in public sector universities. Prof Dr. Kausar Malik will serve as convener of the committee, along with other members, which include Prof. Dr. Anwar ul Hassan, Prof. Dr. M Aslam Baig, and Prof. Dr. Sara Safdar. A performance evaluation committee for vice chancellors in public sector universities was also constituted for a period of two years. The committee will include Dr. Shafiq ur Rehman, Prof. Dr. Zahir Shah, and Prof. Dr. Akmal.
The cabinet approved the unfreezing of the ADP project for the establishment of the Government Degree College Boi, Abbottabad. It also approved the replacement of a condemned vehicle for the District Court Kurram and an additional grant of PKR 9,934,000 for the purchase of a vehicle for the official use of an Honorable Judge of the Peshawar High Court.
The cabinet conditionally sanctioned Secretariat Performance Allowance for the employees of the Solicitor’s Wing of the Law Department, in compliance with the judgment of the High Court in a writ petition. It is pertinent to mention here that presently four posts of officers and 22 posts of officials exist in the Solicitor’s office, against which two officers and 15 officials are working. Aggrieved by the decision of the Finance Department over the stoppage of the allowance, the employee of Solicitor’s Wing filed a writ petition, which was allowed by the High Court vide order dated April 23, 2015.
The cabinet also conditionally approved the salary and privileges arrears of Aqal Badshah, Ex-Provincial Ombudsman, at par with the salary of a High Court Judge, based on the rates prevailing during his tenure. This is subject to the final decision of a CPLA filed in the Supreme Court of Pakistan.
The cabinet approved the transfer of 11 kanals of state land to the Health Department for the upgradation of the Rural Health Center (RHC) Nizampur to a Category-D Hospital in District Nowshera.
The cabinet endorsed the recommendations of the 5th meeting of the Cabinet Supervisory Committee (CSC) regarding outsourced hospitals in different districts. Ex-post facto approval was granted for the release of funds to implementing partners. It also approved the revival of two previously frozen health schemes as ADP projects for the current financial year. These include the upgradation of a BHU to an RHC in Swat, as well as upgrading Maidan Hospital in Dir Lower from Category D to C.
The cabinet approved a non-ADP scheme amounting to Rs.3.1475 billion for the recovery of maternal and child healthcare equipment in flood-affected areas of Hazara division in Khyber Pakhtunkhwa. The objective of the project is to strengthen the diagnostic and treatment system in the target facilities and improve the regional referral system through the provision of medical equipment necessary to provide maternal and child health services at the primary, secondary, and tertiary health facilities located in flood-affected surrounding areas. The project will be implemented with financial support of 3.06 billion from the Japan International Cooperation Agency (JICA).
The cabinet approved the training program for nurses from the Health Department at Chester University, UK. The cabinet approved a grant of Rs 166.154 million for 8 Model Schools located in the merged districts at Ghallanai, Mamad Gat, Miranshah, Zam Tank, Wana, Parachinar, Sadda Kurram, and Bajaur. It also approved funds amounting to Rs. 8.638 million for the renovation of the Model School at Ghallani, Mohmand.
The cabinet approved a one-year extension for the “Literacy for All” program in the merged districts, with a total cost of PKR 223.872 million. The program, which began in 2015, aims to eradicate illiteracy and achieve universal primary education by enrolling out-of-school children. The extension will be from July 1, 2024, to June 30, 2025. Additionally, the cabinet approved an exit strategy, under which centers will be rationalized and converted into the Taleem Card scheme.
A provision of Rs 30.594 million was approved as land compensation for the Government Polytechnic Institute Mansehra under a non-ADP scheme.
The cabinet approved amendments to the Khyber Pakhtunkhwa Land-use and Building Control Act, 2024, following a diagnostic review of the 2021 Act and the prevailing legal and regulatory framework for local government and urban development in the province. The cabinet approved the transfer of state land to the Local Government Department for the construction of the TMA Lahor office building in Swabi under an ADP scheme.
The cabinet approved the de-notification of the Khyber Pakhtunkhwa Tehsil Local Government (Private Housing Schemes Management and Regulation) Rules 2021 and Khyber Pakhtunkhwa Model Building By-laws Rules 2017. Under section 52 of the Land Use and Building Control Act 2021, it is the mandate of the Land Use & Building Control Council to make regulations.
Accordingly, the Khyber Pakhtunkhwa Housing Societies Regulations, 2024, and Khyber Pakhtunkhwa Building Regulations, 2024, have been drafted. The Land Use & Building Control Council, in its third meeting on June 3, 2024, approved the said regulations. After the approval of these regulations, it is imperative that the government de-notifies the Khyber Pakhtunkhwa Tehsil Local Government (Private Housing Schemes Management and Regulation) Rules 2021 and Khyber Pakhtunkhwa Model Building By-laws Rules 2017, framed under the Khyber Pakhtunkhwa Local Government Act, 2013.
The cabinet authorized the Tehsil Chairman of Sarai Naurang Tehsil Local Government to sign an agreement with Bagcilar Municipality of Istanbul, Turkiye, to establish a sister city relationship. The Ministry of Foreign Affairs, Islamabad, has already granted the No Objection Certificate (NOC) for this agreement.
The cabinet approved a special compensation package of Rs 14.87 million for the 119 victims of the fire incident that occurred at Nothia Bazar, Peshawar.