Editor in Chief: Moh. Reza Huwaida Sunday, February 18th, 2018

Unbalanced Budgeting

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Unbalanced Budgeting

With the approval of members of the national assembly, the 377 billion Afghani budget for the next year has reached the implementation stage but there is a point in this budget that goes unnoticed almost every year and that point is the imbalance present in the budget planning of different provinces of Afghanistan.
Every year, some provinces get more budget and many other provinces remain deprived of a proper budget. The newly approved budget has a similar characteristic.
Pages 82 and 81 of the budget information document that has been submitted to the Wolosi Jirga, contains a chart showing budget expenditure based on province. In the accepted budget, this chart is present for the fiscal year 1396 but it has been omitted for the year 1397 although it was present in the first draft of the document.
Out of the total budget, 219 billion Afghani, which is 57 percent of the budget, has been allocated to provinces and 140 billion Afghani, which is 43 percent of the budget, has been set for national investments.
Based on this document, the highest budget, an amount of 24 billion and 979 million afghani has been allocated to Kabul. Nangahar is the province with the second highest budget, 18 billion and 417 million Afghani. Balkh stands third with a budget of 16 billion and 407 million Afghani. Then provinces with budgets of more than 10 billion Afghani include Qandahar (16 billion and 386 million Afghani), Herat (14 billion and 525 million Afghani), Paktia (11 billion and 989 million Afghani), and finally Helmand (11 billion and 281 million Afghani) which rank 4th to 10th among provinces with highest allocated budgets respectively.
Provinces with the lowest allocated budget include Panjsher, receiving the lowest budget, an amount of 1 billion and 715 Afghan, then Nooristan ranks second with an amount of 1 billion and 911 million Afghani, Uruzgan third, with an amount of 2 billion and 12 million Afghani, Badghis fourth with an amount of 2 billion and 148 million Afghani, Zabul fifth with an amount of 2 billion and 197 million afghani, Daikundi sixth with an amount of 2 billion and 262 millioin Afghani, and Samangan ranks seventh with an amount of 2 billion and 351 million Afghani.
However, the current allocation of budget is arbitrary while the budget should be allocated for every province based on per capita. On pages 87 and 88, the budget has been analyzed based on provincial expenditure.
Per capita expenditure based on province has been shown on a chart (Figure 8) and the information has been made through calculations in which the population of provinces has not been given in the chart. It must be mentioned that the chart has been made in such a way that it makes it difficult for the reader to properly comprehend the data. It seems that the writers or organizers of the budget’s document are properly aware of the sensitivity of the people and their representatives over this issue and therefore they have made the charts such.
According to the information in the document, the highest budget per capita has been allocated to Paktia, where everyone gets 20,973 Afghani (equivalent of $313 USD) per person. Following Paktia, Nimroz, Qandahar, Helman, Nooristan, Balkh and Nagahar get the highest budget per capita respectively.
At the end of the figure, there are five provinces with the lowest budget per capita which are as follows: Ghazni, Ghor, Faryab, Badghis, and Sar-e-Pul. Among these, Ghazni gets the lowest expenditure per capita where the government has set an amount of 3,336 Afghani, an equivalent of $50 USD per person.
An important point to be considered is that per capita information for the budget has been given for the provinces with the highest and lowest per capita expenditure only and exact information does not exist for all of the provinces.
The author, after observing the figure presented in the document of the budget, budgets of all the mentioned provinces in the current budget and report of the estimated population of Afghanistan by Central Statistics Office (CSO), has prepared an appropriate chart to make it for readers easier to comprehend and compare. Likewise, it must be noted that all the information in this report that is related to population, is an estimate and no accurate information exists on census.
According to the announcement of the budget, the total budget relating to provinces has been estimated as 219 billion Afghani. If this amount is divided on the total number of population living in provinces (as estimated by CSO), we get an average per capita budget of around 7,350 afghani. (Red line in the figure). In this sense, at least half of the provinces of the country, are under the line of average per capita of the budget and the per capita difference between the highest and lowest expenditure is around 6 times.
Similarly, around 140 billion Afghani has been allocated to national projects which will not be spent by provinces. It is important to note that many of the national projects profit big provinces and it can hardly be observed that small and deprived provinces get big profits from national projects. Another interesting point is that Kabul province gets place as 29th in terms of per capita expenditure of the budget. As mentioned above, certainly this province benefits the most from national projects and with the consideration of this point, certainly has the first place among all provinces in terms of per capita expenditure. The government must pay attention to this issue because failure of responding to the lack of balance in budget planning for deprived provinces can have consequences.
As we have observed in the past 17 years, that lack of attention to deprived territories has resulted in migration of their residents to big cities where material facilities are concentrated.
Lack proper capacity in big cities has created secondary problems caused by such migration that includes lack of housing, air pollution, traffic and so on which again forces the government to spend  more in order to solve these problems and this process continues in a vicious cycle.
It must be kept in mind that today stepping towards economic expansion and development is much easier than the past because footsteps of other countries are before us from which we can learn and avoid their mistakes. We can learn one of the important lessons of economic expansion and development from our neighboring country, China. This country had the highest number of citizens living under the line of poverty, but by adopting correct economic policies, she has pulled above the line of poverty around 250 million of its citizens.
The current situation in Afghanistan is also such that majority of its population is rural, which can be taken into attention through proper policies and implementation of village development at a higher level and in budget planning. The government has tried to implement this goal through the introduction of “MesaqShahrwandi Program”, which has provided and improved basic services as education, health services, basic infrastructures (drinking water, roads, irrigation, reproducible energy), hygiene, trash picking, and development of agricultural services.
However, the budget of this ten-year program is 52.3 billion Afghani which is the equivalent of $750 million USD, which is financed by the international community, Afghanistan and the World Bank and is implemented in three stages.
Given this cases, the annual budget will be around 5 billion Afghani which is still not enough to maintain the required balance among the provinces of Afghanistan and more serious steps and appropriation of more budget is required for creating balance.

Mohammad Mahdi Shafaei is the newly emerging writer of the Daily Outlook Afghanistan. He can be reached at outlookafghanistan@gmai.com

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