Resource information
Khyber Pakhtunkhwa (KP) is one of the
least-developed and crisis-prone provinces in Pakistan.
Located in far north of the country, the province covers 10
percent of the total land area and is a home to 13 percent
of the country's population spread over seven
administrative districts. Majority of the population (83
percent) is rural, averaging 7.6 members per household-well
above the national average of 6.6. The literacy rate remains
low at 49 percent with more than half of population having
no access to tap water while unemployment runs at 8.5
percent. KP's relative underperformance is primarily
due to low levels of growth, socio-economic underdevelopment
and lack of public services compared to other provinces of
Pakistan. Cognizant of the challenges to growth in KP and
acting upon the assessment of Pakistan Government's
Post-Crisis Needs Assessment (PCNA) of the region in October
2010, the donors agreed on a harmonized approach to meet the
short- and medium-term social and economic needs of KP,
including the establishment of a Multi-Donor Trust Fund
(MDTF). This Public Expenditure Review (PER) of KP was
undertaken in partnership with the government of KP and is
one of the important outcomes of PCNA funded by the MDTF.
The report on Operationalization of Post Crisis Needs
Assessment (OPCNA) highlighted the need for strengthening
KP's public financial management (PFM) as fundamental
to improving public services and therefore the quality of
life in KP. The report acknowledges the strong government
ownership of reform initiatives which are taken with a view
of strengthening all aspects of public finances. KP adopted
a comprehensive fiscal reform program in 2001-02 based on
four pillars, namely: 1) enhancing resources; 2)
strengthening ex-ante and ex-post PFM reforms; 3) fiscal
decentralization; and 4) instituting an output-based
accountability mechanism.
