ISLAMABAD: The federal government has increased the amount of net hydel profit (NHP) for the Water and Power Development Authority (Wapda) by 100 per cent to Rs3 billion from Rs1.5 billion per month from the new fiscal year for onward payment to Khyber-Pakhtunkhwa (KP), but no increase is insight in the budget of the Newly-Merged Districts (NMDs), well-informed told Business Recorder.

The decision was taken at a meeting held under the chairmanship of Secretary Finance Imdadullah Bosal on July 2, 2024, convened to discuss the financial issues of Khyber-Pakhtunkhwa.

The delegation of the Khyber-Pakhtunkhwa government was led by the Advisor on Finance, Muzzammil Aslam, whereas, secretaries of the Power and Water Resources Divisions, Secretary Finance KP, CEO, CPPA-G and Member Finance WAPDA, participated in it. The chief secretary KP joined the meeting through Zoom link.

On the issue of payment of NHP, the provincial government stated that arrears of NHP stood at Rs37 billion (excluding indexation).

It was also stated that indexation was allowed by the National Electric Power Regulatory Authority (Nepra), on generation tariff; therefore, Wapda/CPPA-G should recognise the same, as well.

The secretary Water Resources Division stated that Wapda was dependent upon the payments received from CPPA-G, for onward payments to the KPK. He also informed that the outstanding amount stood at Rs37 billion.

The secretary Power Division stated that the NHP component of tariff was being charged at Rs1.10/kWh and the payments to Wapda were being made at the same rate. It was further suggested that the issues related to indexation may be left to the appropriate forums, including the CCI and the immediate issues of arrears may be addressed forthwith.

After a detailed discussion, it was decided that CPPA-G would increase its payments to Wapda by Rs1.5 billion per month to enable Wapda to increase its monthly payment to KPK from the current Rs1.5 billion to Rs3 billion on account of NHP. It was further decided that Power Division and Water Resources Division will ensure that Rs3 billion per month is paid, to the Government of KP starting July 2024.

The advisor to the Government of KP on Finance stated that Rs 66 billion and Rs70 billion have been allocated for the current and development budget of NMDs, respectively for FY 2024-25. Salaries of employees were increased at the rate of 35 per cent in 2023-24 and at the rate of 25 per cent for FY 2024-25. However, no increase has been given in the current budget of NMDs and there is a shortfall of 60 per cent only on account of an increase in the salaries of NMDs employees He requested to increase the current budget of NMDs for 2024-25 as per increase in the salaries of employees.

The secretary Finance Division informed that allocations for the current and development budget of NMDs have been made keeping in view the fiscal position of the federal government. At this stage, it is not possible to enhance the budget allocations for FY 2024-25.

He; however, assured that for the next financial year appropriate increase will be considered for the current budget of NMDs keeping in view the inflation and increase in the salaries of the employees.

It was decided that the Finance Division will constitute a committee regarding the current budget of NMDs. The Government of KP will share details of salary and other expenditures of the NMDs with the said committee, which will give its recommendations before the next budget.

Copyright Business Recorder, 2024


200 characters