In s t it u t e o f M a n a g e m e

U n i v e r s i t y o f B a l o c h i s t a n , Q

ASSIGNMENT # 2

Compare the Balochistan provincial budgets and criticize

SUBMITTED BY NAJEEBULLAH

SUBMITTED TO Mr. Adeel Anjum

PROGRAM MPA

ENROLMETN # P15

SESSION 2008-2010

SUBJECT PUBLIC FINANCE

DATE OF SUBMISSION 6/07/2010

Budget definition:
Budget is a careful instrument of public policy depicting appropriate
utilization of resources for proper policy Implementation in the light of
the political mandate of the Government.
The budget of a government is a summary or plan of the intended
revenues and expenditures of that government.
Budget presents the whole problem of financing the Government and
attracts legislative and public attention on the total expenditure
compared to the total revenue receipts.
Budgeting Process

Budgeting is the formal procedure of preparing budgets. It involves the

following basic steps:

• Identifying expenses
• Determining different sources of income
• Preparing the budget
• Establishing the budget period
• Laying down the budget procedure
• Allocating income for expenses
• Monitoring the efficiency of the budget

Re-assessing the budget

National Budget

National budgets are legal documents, which are provided by

legislatures before being passed by the executive head of the nation,
such as the president, prime minister or other chief official of a nation.
The budgeting process of a nation involves:
 • Classifying expenses: The expenses allocated in a government
budget include consumption and investment expenditure on
infrastructure development and research and development. It
also includes transfer payments, such as social security and
unemployment benefits.
• Revenue determination: The primary source of revenue
generation for a government budget is taxes.
• Preparing budgets: A government budget may be for a quarter, a
year, five years or ten years. The period of the budget and the
procedure of revenue allocation are exclusively mentioned by
the government.

Examples of specific country budgeting processes, such as those in US,

Canada, UK, Germany, Australia, New Zealand, Japan, Pakistan, India
and Brazil.
Budget contains the following things:
• Expenditure
o Revenue Expenditure
o Capital Expenditure
o Development Expenditure
• Revenue
o Revenue Receipts
o Capital Receipts
 BALOCHISTAN BUDGETS OF FISCAL YEAR 2009-2010
AND 2010-2011 COMPARISON

2010-2011
Rs. in billion

A REVENUE RECEIPTS 115.527

Divisible Pool 83.000
Straight transfer 16.398
Grants 12.000
i Arrears (Well head price) 2.000
ii. Arrears GDS 10.000
Provincial Own Receipt 4.130

B CAPITAL RECEIPTS 29.390

Recoveries (Loans and Advances) 0.107
State Trading 10.134
Floating Debt (W&M Limit/Adv.) 9.021
Repayment of Blocked Account-I
By Federal Government 5.400
Resources for Development 4.727
Foreign Project Assistance Loan 3.916
Cash Assistance (Japanese Grants) 0.012
Counter Value Fund (Japan)
(For Pasni Fish Harbor
Authority) 0.800side PSDP/Public Rep. Prig. -
SUMMARY
Total Revenue Receipts (A) 115.527
Total Capital Receipts (B) 29.390
Total Receipts (A+B) 144.917

C REVENUE EXPENDITURE 83.444

Current Revenue Expenditure 83.444
General Public Service 18.565
Public Order Safety Affairs 12.505
Economic Affairs 9.107
Housing and Community Amenities 6.680
Health Affairs & Services 7.443
Recreation, Culture and Religion 2.226
Education Affairs and Services 17.328
Social Protection 0.782
Subsidies 0.418
Grant for Local Governments 4.000
Debt Servicing (Interest) 4.391
Net surplus/deficit (A-C) 32.084

D CAPITAL EXPENDITURE 41.819

Repayment of Central Loans (Principal) 2.973
Loans and Advances 0.600
Investment 12.000
Repayment of Block A/C -I by Fed. Govt.3.600
(Principal
Repayment of Block A/C -II by Prov. Govt2.200
. (Principal)
Repayment of CDL 1.710
State Trading 9.716
Public Debt to be discharged 9.021
Net surplus/deficit (B-D) (12.430)
E DEVELOPMENT EXPENDITURE 26.754
PSDP 22.026
Foreign Project Assistance Loan 3.916
Cash Assistance (Japanese Grants) 0.012
Counter Value Fund (Japan) (For Pasni
Fish Harbor Authority) 0.800

SUMMARY
Total Current Expenditure (C+D) 125.263
Total Development Expenditure (E) 26.754
Total Expenditure (C+D+E) 152.017

OVER ALL POSITION (7.100) (deficit)

2009-2010
Rs. in billion

A - TOTAL REVENUE RECEIPTS 59.054101

(I) Federal Receipts 55.408436

Shared Taxes 29.204937

Subvention 13.9755

Surcharge on Gas 5.6329

Excise Duty on Gas 1.3710

Royalty on Gas 4.4437

GST (Provincial) 0.7803

(II) Provincial Receipts 53.0812

Tax Receipts 1.1327

Non-Tax Receipts 2.51299

B - CURRENT REVENUE EXP 53.08127

General Administration 10.1321

Law & Order 5.5582

Community Services 1.791855

Social Services 5.1736

Economic Services 5.6828

Subsidy (Wheat) 1.000

Debt Servicing 1.7425

Provincial Allocable/GST 2.5% 22.000

C - Revenue Surplus (A-B) 5.9728

D - CAPITAL RECEIPTS 1.6854

Recoveries (Loans & Advances) 0.0813

Unfunded Debt 1.6040

E - CURRENT CAPITAL EXPENDITURE 2.6289

Repayment of Central Loans 2.32890

Loans & Advances 0.3000

F- Net Capital Receipt (D-E) 0.9435

REVENUE SURPLUS (C-F) (5.0293)

RESOURCES FOR DEV. OUTLAY 10.2038

Resources for Development 5.0293

Foreign Project Assistance Loan 5163 0

Cash Assistance (Japanese Grant) 0.0115

DEVELOPMENT OUTLAY 18536.322

PSDP 10.4291

Public Representative Program 3.0000

Foreign Project Assistance Loan 5.0957

Cash Assistance (Japanese Grant) 0.0115

TOTAL DEFICIT (8.3324)

ANALYSIS
When we compare the budget of 2009-2010 with the 2010-2011 then
we find that this year budget is as double as previous year. The budget
of 2009-2010 was also a record budget as compare with 2008-2009.
But we didn’t find any major development project for the province
Because of lack of implementation of the policy.
The positive point is that in the current year budget a very good
amount is invested in development sector. The increase in the budget
of development sector is a good sign. The budget deficit has also
decreased as compared with previous. The 100% increase in salaries
of police, levies is also a positive step of finishing corruption in police
as compare with the previous budget only 15% increase in the salaries
of the government employees. And in the budget of 2010-2011 the
salaries and pension has also increased by 50%, which is a good sign
towards the progress of the province. But a very less amount is
estimated for the education in the province. The education system is
going worse day by day. No any single point is mentioned in the
current and previous budget. No any single point is mentioned in both
budgets about the shortage of electricity. Another negative point of
the budget of 2010-2011 is that the subsidy has decreased
significantly, which is not a good sign.