The government has proposed transfers of Rs 1.2709 trillion (net) to provinces in the current budget against Rs 1.022 trillion in the previous budget (2010-11), which is 24.3 percent higher as compared to last year. According to the budget documents last year the federal government's total transfer of resources to provinces stood at Rs 1.07 trillion against current year's budget estimates of Rs 1.313 trillion.
The estimated provincial surplus has been projected at Rs 1.24,882 trillion for 2011-12 against Rs 1.66,925 trillion in budget estimates of 2010-11 and Rs 1.19,805 trillion revised budget estimates of 2010-11. The transfer to provinces on net basis registered an increase of Rs 54.212 billion in the revised estimates of 2010-11, which are placed at Rs 1.27088 trillion in budget estimates of 2011-12. It shows that net transfer of resources to provinces has increased by 24.3 percent against the revised budgetary estimates of 2010-11.
The provinces would receive a total of Rs 1.313 trillion in the current budget against Rs 1.119 trillion in 2010-11 - the amount was further revised to Rs 1.073 trillion after the devastating floods in August 2010. The federal government would allocate Rs 1.043 trillion to the provinces during the year from divisible pool, while in 2010-11 federal government originally allocated Rs 865.778 billion from divisible pool to the provinces, which was reduced to Rs 834.664 billion after the floods.
The current budget provides Rs 159.388 billion to provinces directly as compared to Rs 167.864 billion direct allocation to provinces in 2010-11, which was reduced to Rs 163.037 billion in the revised estimate reflecting the fact that in current budget the government's direct allocation to provinces has increased by Rs 6 billion.
In the shape of special grants/subventions the government will provide Rs 55.43 billion to provinces as compared to Rs 54 billion in the last budget. The Centre would provide provinces over Rs 38 billion as project loans against Rs 21 billion in the last budget's revised estimates and Rs 16.63 billion as programme loans during the new fiscal year, while no allocation was made last fiscal year. Furthermore the provinces would get Rs 90 million Japanese grant as compared to Rs 52 million in the last fiscal year.
Net transfer of payment to provinces in the current budget would stand at Rs 1.270 trillion against last year's revised transfers of Rs 1.022 trillion. Payment to federal government would stand at Rs 42.830 billion against last year's revised payment of Rs 50.938 billion. The government paid Rs 16.638 billion as interest on behalf of provinces in the last budget, while in the current budget it would pay Rs 15.638 billion. In the shape of loan repayments the federal government last year paid Rs 32.429 billion, while in current budget it would pay Rs 27.192 billion.