December issue 2018

No, prime minister: The prime minister with the chief ministers of the four provinces.

Coming to power at the centre and in the Punjab for the first time and in Khyber Pakhtunkhwa (KP) for a second consecutive term, the Pakistan Tehreek-e-Insaf (PTI) has taken on those issues which were part of their election rhetoric and the highlights of their manifesto. Empowering the local government (LG) system was one of those pledges. 

PTI Chairman Imran Khan has always talked about and criticised his political rivals for their reluctance to designate the LG with powers and financial autonomy. A major source of reference would be the PTI-led LG system in KP: how it has devolved power at the village and neighbourhood level and how 30 per cent of the Annual Development Programme (ADP) is spent through the LG. Khan has also, on several occasions, claimed that the LG representatives across the country would like to see the KP LG system applied in their respective provinces. 

After taking oath, the prime minister constituted various task forces to work on recommendations for reforms in different sectors. One of the task forces was asked to prepare the draft of a new LG law to be presented before the provincial assemblies, to initiate the required legislation process and to ask the provinces to amend the LG laws under Article 140(A) of the constitution, which ensures the administrative and financial autonomy of LG bodies.

The task force on the LG is headed by Khan’s close aide and Punjab’s Minister for Local Government, Aleem Khan. The proposed changes, as reported in the media, suggest a uniform LG law in Punjab and KP. For the most part it would be a replication of the KP LG system, with a few changes. On November 16, Aleem Khan, in his interaction with the media outside the Punjab Assembly, hinted that in the new system, Punjab would have 25,000 elected village and neighbourhood councils which would be directly funded. He vowed to give administrative and financial powers to the LG bodies and claimed that development funds would not be allocated to members of the national and provincial assemblies.

On the other hand, Fawad Chaudhry, the Federal Information Minister, also claimed that the prime minister had endorsed his proposal of direct elections of the mayor. He referred to the system in London, Birmingham and Scandinavian countries, in which a city’s mayor is elected directly by the people (as opposed to union councils, or tehsils, as was the case in Pakistan). The proposal, however, has met with opposition within the PTI and from the party’s allies in Balochistan for a variety of reasons, which include complications that may arise in such elections.

The KP Local Government Act was approved in 2013. It has seen 11 amendments, mostly aimed at stripping the act of the powers initially vested in it. Initially, 24 departments were devolved at the LG level, but later seven of these – technical education, special education, adult literacy, community development, social and farm-forestry, communications and irrigation – were retracted through various amendments. 

The office of the district nazim has been reduced to the administrative functions of disbursing salaries and conveying orders to the concerned departments. It is not authorised to hire and fire employees, nor are any of the departments accountable to the district nazim and instead answer to the deputy commissioner (DC). The DCs hold public hearings (khuli kachehri) to address the public’s needs – an arrangement that undermines the powers of the elected district representatives. 

Plans to abolish the district governments under the pretext of redundancy and the overlapping of their functions with the tehsil governments, are perceived as an attempt by the provincial government to wrest back most of the devolved departments. The bureaucracy and the elected MNAs and MPAs desperately want this to happen. Imran Khan himself conceded in an interview last year that the LG system in KP could not be fully implemented since lawmakers from his own party and the bureaucracy resisted it. The decision, therefore, to do away with the district councils, it is hoped, would ease the tensions and discontent among lawmakers and please the bureaucracy at the district management level.

In June 2015, LG elections were held after a delay of two years. The delay, according to critics, was a result of PTI’s lack of interest in governing since it had immersed itself in the politics of agitation. The KP government was focused on facilitating the dharna in Islamabad and had no time for LG elections. The PTI however, was not alone. None of the other mainstream political parties had gotten around to holding LG elections in the other provinces either. When elections were held, the PTI was quick to complete the process and constitute the Provincial Finance Commission (PFC). The commission, as per the law, is chaired by the finance minister and includes two members of the provincial assembly – one nominated by the chief minister and the other by the leader of the opposition in the assembly. It also includes secretaries of finance, planning and development, local government and law departments, and four nazims – two from the tehsil level and two from the district level. They were elected by the current lot of 23 district and 68 tehsil/town nazims. 

The commission had to devise a formula for the distribution of resources among the districts. A month before the LG elections, Imran Khan claimed that the PFC award would be introduced after the elections, under which the funds would be transferred to the districts that would be authorised to spend them as per their needs. He also said that the chief minister would have no authority over the funds after they were transferred to the districts.

But the commission, despite all claims, did not meet expectations. It announced the PFC award for 2016-17, but could not administer it in practice and did not announce the PFC award for the years 2017-18 and 2018-19, despite persistent demands by elected representatives and civil society organisations.

A major chunk of the resources provided to the districts goes towards salaries and other expenses of the devolved departments and only a meagre amount is left for development schemes. For instance, on September 25, Peshawar’s district government announced its annual budget for the financial year 2018-19. Out of the total budget of Rs 11.181 billion, Rs 9.893 billion were allocated for the payment of salaries and Rs 0.587 billion for non-salary expenditure, while only Rs 700 million were kept aside for development. The budget had no allocations for new schemes in education, health, agriculture, sports and women’s development. It was a violation of the guidelines given by the KP Planning and Development Department, under which the district governments were to allocate 20 per cent of the ADP funds for the education sector, 10 per cent for healthcare and 15 per cent for sports, agriculture and women’s development. 

Instead, these departments will get Rs. 330 million in liabilities from the development schemes of the previous financial year. The district government had spent Rs 680 million, keeping in view Peshawar’s share in the PFC award, but received only Rs 370 million from KP’s Finance Department. As per the criteria, funds are released to local government bodies after the utilisation of 60 per cent of the previous year’s funds. In this case, the certificate was submitted to the Finance Department in January this year, but it witheld the release of the remaining funds.

This arbitrary condition of the 60 per cent utilisation of the previous budget for release of fresh funds is termed a violation of the KP Local Government Act by legal experts. The act pledges to spend 30 per cent of the ADP through three tiers of local bodies, the village and neighbourhood councils, tehsil councils, and district councils, but was amended last year, so that the provincial government could spend this amount on designated plans and for political maneouvering in constituencies of their choice. Also, in the past three years, funds to the local bodies were slashed under different pretexts and were disproportionately diverted to a few districts – the home constituencies of KP’s chief minister, finance minister, speaker of the assembly and other members of the cabinet. 

In the first financial year (2015-16), the KP government slashed Rs 27 billion from the total funds of Rs 42 billion to be allocated to the local bodies. In the second year (2016-17); it released only Rs 27 billion out of a total of Rs 36 billion. And last year (2017-18), the provincial government released only Rs 10 billion to the three tiers of the LG, against its share of Rs 37 billion.

The Centre for Governance and Public Accountability (CGPA) revealed that in June 2018, the KP government had utilised Rs 837 million from the LG budget as discretionary funds in the fiscal year 2017-18. Out of the total of Rs 837 million in development funds, Rs 280 million were placed at the discretion of the then finance minister and Rs 557 million were at the discretion of the then chief minister. 

The CGPA, in a press statement, provided further details of the misuse of funds, of which Rs 490 million was allocated to the home district – Nowshera – of the then chief minister; Pervez Khattak, while Rs 200 million were allocated to the home district – Lower Dir – of the then finance minister, Muzaffar Saeed. The other districts that received discretionary funds were Swabi (Rs 55 million), Lakki Marwat (Rs 19 million), Charsadda (Rs 18.7 million), Peshawar (Rs 11.3 million), Mardan (Rs 10.1 million), Swat (Rs 8 million), Malakand (Rs 7 million), Chitral (Rs 5.5 million), Buner (Rs 5 million), Karak (Rs 2.7 million), Upper Dir (Rs 1.7 million), Bannu and Haripur (Rs 1 million each) and Mansehra (Rs 0.7 million). The districts that were deprived of discretionary funds by the chief minister and finance minister, include Kohistan, Shangla, Hangu, Tank, Torghar, Battagram, Dera Ismail Khan, Kohat and Abbottabad.

The practice went on during these years, despite Imran Khan’s instructions to the chief minister to the contrary in the previous years and his public addresses in which he always boasted about his party’s performance in KP. It did not stop there. With the PTI’s former coalition partners, the Jamaat-e-Islami (JI), no longer a part of the setup, the new provincial government diverted budgetary allocations from the constituencies of former JI MPAs and cabinet members, to other districts and development projects.

While Imran Khan admitted in an interview with BBC Urdu last year that his party had made mistakes due to lack of experience, he must realise that all his claims of bestowing the LG with administrative and financial powers existed only on paper. Meanwhile, his party members engaged in the very practices he had criticised others for. His commitment to empowering the LG in all the provinces as per article 140(A) of the Constitution must be appreciated, but the KP model is not something that should be followed to achieve this purpose.