City District Government Karachi: financial crunch gradually intensifies

Maverick_27 · October 13, 2009, 5:05am

** Gap to pay salaries expands by Rs 220m g Rs 1bn owed to contractors

By Irfan Aligi

*KARACHI: City District Government Karachi (CDGK) is still going through a crucial time as the financial crunch gradually intensifies and all the options for addressing the ongoing financial deficit are seemingly proving fruitless.

The CDGK has two pressing crises to resolve, but it has neither noteworthy resources for revenue generation nor does it have an appropriate mechanism for controlling the leakage of funds through cumbersome enterprises.

On the one hand, the CDGK has a mounting gap in the prompt disbursement of salaries of around 30,000 employees, and on the other hand, it has great paucity of funds to settle outstanding bills of the contractors.

A well-placed officer in the CDGK told Daily Times that the CDGK has to disburse around Rs 500 million in terms of employee salaries, while the funds’ receipts for the same from the Sindh government in terms of Octroi and Zilla Tax are limited to Rs 280 million.

The officer also said that the ban on lease by the Sindh government has also caused the CDGK to refrain from collecting around Rs 720 million through the auction of Saddar Car Parking Plaza (SCPP) premises, adding that the CDGK owed Rs 1 billion to the contractors.

A contractor, who had constructed the multi-storeyed SCPP, had submitted a bill for Rs 60 million in April, which the CDGK has yet to pay. The same contractor had submitted two more bills for Rs 40 million and Rs 25 million in June, but the CDGK has not been able to settle these bills as well.

Before the construction of SCPP, the same contractor had constructed various CDGK projects, however, the CDGK still owes him Rs 10.12 million in terms of outstanding dues, while Rs 10.92 million in terms of security deposit.

The officer further said that the contractor had submitted bills for Rs 50.75 million, Rs 10.12 million, Rs 30 million, Rs 20.54 million, Rs 10.45 million and Rs 7.5 million, but none of those have been hitherto settled.

It is pertinent to mention here that all these bills have been checked and approved by the concerned authorities.

The officer added that the CDGK spends approximately Rs 700 million to pay salaries of employees and to meet contingent expenses with the assistance of the Sindh government, which releases the Single Line Transfer of Funds (SLTF) for this purpose.

Meanwhile, the Sindh government has already increased the SLTF from Rs 875 million to Rs 1.036 billion.

Daily Times - Leading News Resource of Pakistan

limited resources and unlimited wants. i think mustafa kamal is required to strike a balance between revenues and spending.

nGenius · October 13, 2009, 5:20am

This is the story of Pakistan. Karachi is the largest City yet our current government doesn’t care about it. During Musharraf Regime economic conditions improved and large-scale development took place in Karachi.

KARACHI: A look at Karachi’s uplift projects

By Azfar-ul-Ashfaque

KARACHI, Aug 18: The city witnessed an unprecedented development work during the more than eight-year rule of former president Pervez Musharraf as he was behind the timely allocation of funds by the federal and provincial governments to successive city governments and played his role in minimising the red-tape.

Even though major development activities in Karachi were carried out by the two city governments – elected in 2001 and 2005 during Musharraf’s rule – the people’s representatives and government officials believe that the credit for the development rests with Mr Musharraf, who had helped arrange the finances.

Besides ensuring funds for the many development projects, the federal government, during Musharraf’s rule, had initiated work to build the Northern Bypass and the Lyari Expressway in the city. While the Northern Bypass had been completed and the south-bound Lyari Expressway is operational, work to construct a north-bound carriageway is in progress.

The shifting of Karachi’s Subzi Mandi from Gulshan-i-Iqbal to the Super Highway and the construction of a park on its place was also an achievement which, according to many officials, could not be possible without the direct support of Mr Musharraf.

It was Mr Musharraf who had directed various federal organisations in the city to give their share for the development of Karachi. The Karachi Port Trust, Pakistan Railways, Pakistan International Airlines, Pakistan Steel Mill, Pakistan Air Force and many other federal bodies had provided funds to the city government for several development projects, which had been constructed under the Rs29 billion Taameer-i-Karachi Programme.

The large-scale construction of road and infrastructure networks, including flyovers and underpasses, completion of the K-III 100-MGD Greater Water Supply project, revival of low-cost housing schemes, construction of Pakistan’s tallest building and many more projects had been initiated and completed during Musharraf’s government.

However, it is also known to everyone that almost every development project – whether it was federally-funded Lyari Expressway or the city government’s Nagan Chowrangi flyover – had missed their deadlines.

His critics also admitted that large-scale development took place in Karachi during Musharraf’s regime. However, they were of the view that none of the previous democratic governments were given sufficient time to carry out and complete development projects in the commercial and economic capital of the country.

Former city nazim Niamatullah Khan, who belongs to the Jamaat-i-Islami, told Dawn that Mr Musharraf had always praised and supported his work when he was the Karachi nazim, but he did not provide funds to the city government for carrying out development work. “During my tenure, he did not give even a single penny to the city government. We had enhanced our revenue and minimised corruption to carry out development works in the city.”

He, however, said that the Lyari Expressway and the Northern Bypass were the projects of the federal government and the city government had nothing to do with the two projects.

Provincial minister and leader of the Muttahida Qaumi Movement Faisal Subzwari said that despite some flaws, the introduction of the devolution of power plan system was an achievement through which the district governments got fiscal autonomy and was able to launch development projects.

He said Mr Musharraf knew the importance of Karachi as the revenue engine of the country. “During his rule, red-tape was minimised although there are projects like the Karachi Mass Transit Programme and the Karachi Circular Railway that could not be initiated due to the insurmountable bureaucratic hurdles.”

City government officials said the former president was very keen on the development of Karachi and he himself monitored the progress of several projects. A former senior official told Dawn that despite his reservations about the former president, Mr Musharraf had approved the Taameer-i-Karachi Programme which was presented by former nazim Niamatullah Khan.

They felt that the change of guard at the highest level might affect the overall development of Karachi.

kakaballi · October 13, 2009, 7:39am