NEC authorises Planning Commission to release funds

The National Economic Council (NEC) has directed the Ministry of Finance to place development funds at the disposal of Planning Commission to expeditiously release them to the executing agencies when required, official sources told Business Recorder here on Thursday.
The Planning Commission had complained to the NEC that the finance ministry is not acting upon the directives issued by the Council in 2004 authorising the Commission to make adjustments, if needed, within the approved size of public sector development program (PSDP). The purpose of this authorisation was to accommodate important and fast moving projects on the basis of quarterly reviews.
However, feedback received from various ministries during the Annual Plan Coordination Committee (APCC) which met on May 21-22 indicated that re-appropriations of funds (within PSDP) decided by the Planning Commission were not fully honoured by the finance ministry.
Likewise, it was generally complained by the ministries and the provinces that most releases for fourth quarter of current fiscal were not made until May 22, despite the fact that funds were due from April 1. The Planning Commission was of the view that delays in the release of funds not only impede timely completion of projects, but also raise the cost of the projects, the sources added.
"NEC had advised the finance ministry to place development funds allocated and re-adjusted as a result of quarterly reviews at the disposal of the Planning Commission for their expeditious release to the executing agencies to ensure completion of projects without delay and cost overruns," the sources maintained.
They also said the Planning Commission has also been authorised to adjust operational shortfall of Rs 35 billion against the total outlay, including special programmes.
The Planning Commission has also been empowered to make adjustments in PSDP, if needed, within the same size of the program to accommodate important projects on the basis of quarterly reviews with the approval of the prime minister, the sources added. It may be mentioned here that the federal government approved Rs 520 billion for PSDP 2007-08, but enhanced it to Rs 543 by adding Rs 23 billion for other expenditures.