ISLAMABAD (June 12 2010): Capital Development Authority (CDA) is likely to announce Rs 18 billion budget for next fiscal year on June 29, which will be about ten billion less than the current year budget of Rs 28 billion. In spite of Rs 10 billion cut in CDA budget, the federal government has increased its share by allocating Rs 4 billion in the next year federal budget in place of Rs 3.6 billion for current year, well informed sources in CDA told Business Recorder.

They said to support its developmental projects, CDA has planned to issue Municipal bonds of Rs 3 billion. The CDA in its budget proposals had suggested a cut of Rs 10 billion in its budget, suggesting Rs 18 billion lay out of the budget for next fiscal year, they said. The suggestion was made in the wake of 44 per cent cut on the Public Sector Development Programme (PSDP), which will bring many of the on-going development projects launched by the civic body to a halt while no new development project will be initiated in the next fiscal year.

Keeping in view the economic crisis and slump in the real estate business, the CDA has no hope of launching any new sector, which would bring more money for the civic body, they said, adding that the civic body has earned Rs 1.57 billion through auction of residential and commercial plots. They revealed to this scribe that the situation is indicative that many development projects, which are in pipeline, would not get sunlight in next fiscal year.

CDA sources said that for current fiscal year the CDA had announced a budget of Rs 28.86 billion, which include Rs 2.55 billion from the PSDP. In the current year Rs 21.300 million incomes was expected by opening new residential sectors and sale of commercial plots. But due to slump in the real estate business expensive commercial plots of the CDA were not auctioned, which badly affected the development plan and about 80 percent development projects were abandoned, they added.

As per proposals submitted to Finance Ministry for fiscal year 2010-11 the CDA has suggested to fix the income of Rs 660 million from property tax, Rs 340 million from water supply, Rs 180 million from Municipal Services, Rs 20 million from Sanitary Services, Rs 110 million from the machinery to be given on rent from PMO, Rs 1.20 million from interest of money deposited in banks and invested in share market, Rs one billion from the transfer fee of plots and Rs 90 million from other miscellaneous services.

In its proposals, the CDA has pointed out the areas of non-development expenditure in which cut is not possible, these include Rs 8 billion for salaries of the employees, Rs 3.160 billion for pensions, Rs 2 billion for utility charges, Rs 440 million for renovations of houses and offices, Rs 350 million for petrol, diesel and CNG, Rs 250 million for telephone, stationery, entertainment and other miscellaneous expenditures, Rs 80 billion for advance salaries of the employees, Rs 40 million for repairing of vehicles, Rs 300 million for increase in salaries and pension, Rs 500 million for calamities or any other incidents and Rs 120 million for miscellaneous expenditures.

Copyright Business Recorder, 2010