desan
President (40k+ posts)
The Khyber Pakhtunkhwa government is about to launch another phase of struggle to receive arrears of its net hydel profit (NHP) which after the decision of the National Electric Power Regulatory Authority (Nepra) have risen to Rs5.23 billion for the last four months of the current financial year.
The Nepra on November 13 approved the uncapping of the NHP by increasing it by around 217 percent. This would allow Khyber Pakhtunkhwa to get almost Rs19 billion NHP every fiscal year against the current capped amount of Rs6 billion.
The decision was taken on the request of the Water and Power Development Authority (Wapda) after an agreement was reached between the Ministry of Water and Power and the Khyber Pakhtunkhwa government earlier this year.
An official of the Finance Department, who shared the documents regarding the fresh figures of the NHP arrears with The News, told this scribe that the federal government owed Rs5234.4 million to the province payable on account of the NHP just for the last four months of the current fiscal.
He said the federal government was not paying even the capped NHP installment of Rs500 million to Khyber Pakhtunkhwa for the last two months.
The official said as per the formula that had been decided, the federal government had to pay every month Rs500 million of the Rs6 billion capped NHP to Khyber Pakhtunkhwa. He added that the federal government had to pay Rs2 billion over the last four months, but the province received Rs500 million each during July and August and nothing in September and October.
He said Rs1 billion amount is due against the federal government for the last two months only as per the old arrangement. He added that under the arrangement recommended by the technical committee that has also been adopted by the Nepra, the payment and arrears story is different altogether.
The official said if the decision is implemented from July 1following the Nepra decision to uncap Rs6 billion and raise it to Rs18.704 billion, the federal government on account of the NHP for the last four months owed the province Rs5.234 billion.
He said the federal government would also have to pay immediately the remaining amount of Rs1.058 billion each for July and August and Rs1.558 billion each for September and October.
The provincial government is working out an intensive plan to take up the matter of dues with the federal government during the current fiscal, the official claimed.
Narrating the chronology of the NHP approval, he said it was a constitutional financial obligation and for the first time a sum of Rs6 billion was paid to Khyber Pakhtunkhwa (KP) during 1991-92 as NHP under the AGN Kazi formula.
However, the amount was capped since then despite the fact that power tariff has been increased manifold.
He said the amount of Rs6 billion was based on the provisional profits of Wapda calculated for 1990-91. He added that National Finance Commission (NFC) had recommended increase at the rate of 10 percent on the Rs6 billion for future years, but Wapda didnt follow the recommendations.
The official said owing to the difference of opinion about the computation of NHP between Khyber Pakhtunkhwa and Wapda, an arbitration tribunal was constituted by the federal government on October 31, 2005 to resolve the dispute. The tribunal announced its decision on October 9, 2006 and gave an award of Rs110.101 billion to Khyber Pakhtunkhwa.
He added that under the AGN Kazi formula, the amount of NHP was supposed to go up to Rs67 billion per annum and the arrears to Rs619 billion from 2005-06 to 2014-15.
According to the arbitration formula, the amount by now should have reached the figure of Rs39 billion per annum and by that standard the arrears from 2005-06 to 2014-15 should have been accumulated at about Rs412 billion, the official said.
http://www.thenews.com.pk/Todays-News-7-352706-Nepra-decision-on-NHP-increase
The Nepra on November 13 approved the uncapping of the NHP by increasing it by around 217 percent. This would allow Khyber Pakhtunkhwa to get almost Rs19 billion NHP every fiscal year against the current capped amount of Rs6 billion.
The decision was taken on the request of the Water and Power Development Authority (Wapda) after an agreement was reached between the Ministry of Water and Power and the Khyber Pakhtunkhwa government earlier this year.
An official of the Finance Department, who shared the documents regarding the fresh figures of the NHP arrears with The News, told this scribe that the federal government owed Rs5234.4 million to the province payable on account of the NHP just for the last four months of the current fiscal.
He said the federal government was not paying even the capped NHP installment of Rs500 million to Khyber Pakhtunkhwa for the last two months.
The official said as per the formula that had been decided, the federal government had to pay every month Rs500 million of the Rs6 billion capped NHP to Khyber Pakhtunkhwa. He added that the federal government had to pay Rs2 billion over the last four months, but the province received Rs500 million each during July and August and nothing in September and October.
He said Rs1 billion amount is due against the federal government for the last two months only as per the old arrangement. He added that under the arrangement recommended by the technical committee that has also been adopted by the Nepra, the payment and arrears story is different altogether.
The official said if the decision is implemented from July 1following the Nepra decision to uncap Rs6 billion and raise it to Rs18.704 billion, the federal government on account of the NHP for the last four months owed the province Rs5.234 billion.
He said the federal government would also have to pay immediately the remaining amount of Rs1.058 billion each for July and August and Rs1.558 billion each for September and October.
The provincial government is working out an intensive plan to take up the matter of dues with the federal government during the current fiscal, the official claimed.
Narrating the chronology of the NHP approval, he said it was a constitutional financial obligation and for the first time a sum of Rs6 billion was paid to Khyber Pakhtunkhwa (KP) during 1991-92 as NHP under the AGN Kazi formula.
However, the amount was capped since then despite the fact that power tariff has been increased manifold.
He said the amount of Rs6 billion was based on the provisional profits of Wapda calculated for 1990-91. He added that National Finance Commission (NFC) had recommended increase at the rate of 10 percent on the Rs6 billion for future years, but Wapda didnt follow the recommendations.
The official said owing to the difference of opinion about the computation of NHP between Khyber Pakhtunkhwa and Wapda, an arbitration tribunal was constituted by the federal government on October 31, 2005 to resolve the dispute. The tribunal announced its decision on October 9, 2006 and gave an award of Rs110.101 billion to Khyber Pakhtunkhwa.
He added that under the AGN Kazi formula, the amount of NHP was supposed to go up to Rs67 billion per annum and the arrears to Rs619 billion from 2005-06 to 2014-15.
According to the arbitration formula, the amount by now should have reached the figure of Rs39 billion per annum and by that standard the arrears from 2005-06 to 2014-15 should have been accumulated at about Rs412 billion, the official said.
http://www.thenews.com.pk/Todays-News-7-352706-Nepra-decision-on-NHP-increase
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