Provincial annual development plan is a tool which could be used by provincial councils to manage whole physical and human resources within the year effectively with proper coordination of relevant stakeholders. Further,it provides important input for other public sector organization and even private sector in making their decisions related to investments and socio-economic development. The Finance Commission issued guidelines annually for last several years to provincial council which were the basis for capital allocations and utilization of funds under provincial specific development grant (PSDG), criteria Based Grant (CBG) and Revenue Performance Grant (CBG) recommended by the Finance Commission.
However, for the year 2020 it will not be practical to prepare an Annual Development Plan based on the figures recommended by the Finance Commission at the annual formal budget would be effective for the second half of the year. Until then the Government has allocated a certain amount to the Provincial Councils for capital expenditure by the vote on Account for the period of 1st January – 30th April 2020 and will allocate capital funds by the formal National Budget 2020 taking into consideration of the Finance Commissions ’s recommendation.
The list of activities in the indicative plan identified by your province could be implemented on priority basis within the provisions in the formal annual Budget for 2020 and continue the balance activities to forthcoming years. You are expected to prepare the Indicative Development Plan, on the basis of the Provincial Master Plan / sectoral Result Framework in order to implement necessary priorities of people’s development needs.
Furthermore, you are advised to utilize the allocations provided in the Vote on Account and the formal budget for the PSDG and CBG firstly to settle bills in hand, commitments and completion of the already started activities on or before 2019 and then only for essential new works in your Indicative Development plan on priority basis. You are kindly requested to prepare the Indicative Development Plan using forms 3 and 3a and in addition to the contents in Annex 1 and Annex 2.
Having such an indicative plan which could be implemented during the year 2020 and forthcoming years will create clear understanding on provincial development priorities those will cater for people’s development needs. The indicative plan would be able to adjust according to the national government policies and provincial development priorities.The collective effort of all stakeholders in preparations of the Development Plan is very important.
The purpose of this Guideline is to facilitate effective utilization of the budgetary allocations to be made to Southern province align with national Development priorities.

2. National Policy Framework

Provincial executive powers and planning need to take place within the National Policy Framework. Hence, Provinces are expected to take note of the following statements of national policy directions along with specific sectoral national policy statements in determining Provincial Development Priorities. You are therefore requested to instruct the provincial authorities to study properly the relevant policy documents.

2.1 National Policy Framework Vistas of Prosperity and Splendour
This National Policy Framework (NPF) of the government constitutes of 10 key policies aimed at achieving the fourfold outcome of a productive citizenry, a contented family, a disciplined and just society and a prosperous nation. Ten key Policies, giving due consideration to socio, economic, environment and political aspects are; Key Policies
• Priority to National Security
• Friendly, Non-aligned, Foreign Policy
• An Administration free from corruption
• New Constitution that fulfills the people’s wishes
• Productive Citizenry and a vibrant Human resource
• People Centric Economic Development
• Technology Based Society
• Development of physical Resources
• Sustainable Environment Management
• Disciplined, Law Abiding and values – based society

The overall objective of the policy document is to develop a national Economic Policy for the benefit of the present and future generations whereby ; People’s ownership of the countries’ economic resources is ensured; local enterprise are strengthened and vital national assets will be secured.
Further the macro economic targets 2020-2025 pointed out in the policy document are maintaining a 6.5% or higher GDP growth rate under macroeconomic program, achieving a per capita income exceeding USD 6500, keep the unemployment rate below 4% and the inflation rate below 5%, to manage the government revenue and expenditure to keep the budget deficit below 4% of GDP, to maintain a single digit rate of interest, and to maintain the exchange value of the rupee at a stable level.

2.2 Agenda 2030 on Sustainable Development
Sri Lanka, as a Member state of the United nations, adapted the Agenda 2030 for sustainable Development, comprised of 17 Goals and 169 Targets. The adaption of the Agenda commits Sri Lanka to a universal, transformative, inclusive and integrated framework of sustainable development with the overall pledge of “leaving no one behind”. The framework is integrated and indivisible and balances the dimensions of sustainable development – primarily the economic, social and environmental. The global agenda will be localized to the Sri Lanka context, taking into account the country’s development policy framework and strategic development priorities. The Agenda 2030 will constitute the overarching framework for an integrated approach to sustainable development’ guiding the process of national provincial resource allocation.

The SDG orientation is:
• Transformative and change oriented
• Future oriented
• Process orientation of SDG actions moving from short-term mainstreaming, through medium-tern acceleration on to long-term policy coherence
• Role of political steerage

3. Reference to Relevant Documents

Reference to important document will be very useful for understanding the current Policies, Development Strategies, trends of the Economic and Social situation of the country before preparing the development Plan. Some of important document are as follows;

• The policy statement made by H.E. the President.
• National Policy Framework “Vistas of Prosperity and Splendor” and relevant circulars & guidelines.
• Agenda 2030 on Sustainable Development.
• Annual Report and Current Economic Trends published by the CBSL.
• Reports of the Institute of Policy Studies.
• Reports published by the Department of Census & Statistics.
• Study reports published by Donor Agencies.
• Other relevant publications

4. Sector Guidelines

Social Infrastructure
1. Education
Investments in the education sector should aim at improving human development creating educated and disciplined nation equipped with basic competencies and skills in order to achieve sustainable development based on knowledge driven economy. Major attention need to be focused on quality improvement, teacher training and professional development and infrastructure development in the school system ensuring access to all children for education and facilitating further studies for employment. In this effort, it is necessary to give priority to the remote areas where educational performance is very low.

2. Western Medicine
Programs and Projects under health sector need to be focused in upgrading the quality of health services giving more attention to preventive aspects. While ensuring qualified staff in all hospitals, the required physical infrastructure should be provided giving particular attention on rural areas (primary medical care centers) where health related indicators are still not up to the expected standards. Providing comfortable services to patients and directing the people towards good health practices are of critically importance. Improving facilities to prevent and treat non communicable diseases and communicable diseases as well as implementing proper nutritional and food safety programs are also vital in this context.

3. Indigenous Medicine
Steps to be taken to conserve traditional medicinal practices and improvement of quality of the Indigenous Medicine System. It is expected to provide more effective medical services catering both domestic and foreign demand using upgraded facilities. Further, investment in this sector should focus on encouraging wellness tourism through promotion of private sector investments aiming more economic benefits for the people.

4. Sports
Steps to be taken to improve the quality of the sports sector with the view of creating an energetic healthy and disciplined nation. Possible measures to be taken for developing athletes to the international level paying due attention on their needs.

5. Probation and Childcare
Allocations need to be made for protection of the rights and safeguarding vulnerable children and rehabilitation of socially deprived children. Special attention to be paid to daily needs and welfare including the rights and protection of the children who are under probation. The emphasis to be given for skills development of children who are under probation with a view to mobilizing them as productive community members on attaining their age of 18 years. Physical and mental health development, integration of the victimized children in to the society, providing facilities for formal education are also priorities to be accorded. Further, it is necessary to take effort to minimize institutionalization of children by frequent monitoring and avoiding vulnerability of particular families.

6. Social Services
Capital grants for the social services are allocated to ensure the welfare of vulnerable people such as diseased persons, aged persons, differently abled and orphans. Provincial authorities are encouraged to establish and maintain homes for elders by adhering to the rules and regulations of the country. Further, a satisfactory contribution has to be ensured to implement the National Action Plan for Disabled (NAPD) with special attention on easy access for public buildings. It is also important to introduce strategies and procedures to encourage the community to take care of elders and differently abled within their own households. Introduction of self – employment avenues for such persons is also needed to promote their social dignity.

7. Early Childhood Development
As early childhood development is a fundamental of developing human capital of the country, sufficient attention for children below 5 years to be ensured. Taking measures to enhance accessibility to relevant resources and promoting mental and physical health condition of children are the main focus of this sector.
8. Cultural and Religious Affairs
Cultural and religious affairs could be separated if appropriate and each subsector to be allocated with not less than 40% of the sectoral allocation. Funds to be used for the projects and activities that help to conserve and preserve the cultural heritage for future generations. Due attention to be made both tangible and intangible cultural assets by identifying relevant projects and programs.

9. Housing
The allocations for housing to be used to provide shelter for low-income and needy families. People’s participation needs to be encouraged when providing grants for housing development aimed at low-income families. Further, concessionary housing loans for low-income families to be promoted using suitable mechanism with existing banking system.

10. Co- operatives
These funds are to be used for the programs focused on the development of co-operative movements. Co-operative departmental and relevant institutional capacity development has to be a main concern aiming better service delivery. Further, Co-operative sector involvement in promotion of tourism need to be encouraged in an innovative manner.

Economic Infrastructure
11. Provincial Roads
Maintenance of an efficient road network connecting large and emerging cities, townships, economic centers and rural hubs while ensuring safety and equity is required for efficient services of all other sectors, Remove bottlenecks in the road network, removal of network gridlock by construction of bridges, link rural hubs to closest township with all other roads, maintenance of the drainage system and other relevant structures are some of the key strategies to be considered.
Outputs and the outcome of road development programs have to be clearly worked out at the project designing stage to select priorities and efficient implementation.

12. Estate Infrastructure
Funds need to be utilized t provide social and economic infrastructures (E.g. sanitary facilities, safe drinking water, and estate roads etc.) in order to improve living condition of the people in estates. In identifying projects, it is follow the national policies and plans for the socioeconomic development of the Plantation Community.

13. Transport
This sector needs to focus on quality passenger services with developed system and amenities. Further, more attention should be paid on training and skill development of all public and private bus operators to ensure disciplined, reliable and clean public transport service. In this process, a proper co-ordination needs to be maintained with the SLTB and the National Transport Commission while improving the basic facilities required by the people. PSDG funds cannot be used for commercial type of development at the bus stands such as shopping complexes and eateries. It is recommended to seek private sector involvement in maintenance of bus halts/ bus stands as much as possible.

14. Land
Funds may be used for the enactment of the relevant laws, alienation of state lands for institutional purposes and maintenance of land banks at provincial level. Further, funds can be utilized for implementing measures on government land conservation.

15. Agriculture
In collaboration with all the stakeholders, effective planning and implementation of project in this sector have to be ensured paying due attention to improvement of production and productivity, facilitation of small and medium scale commercial cultivation, promotion of agro based industries/ value added industries, minimization of post-harvest loss, introduction of alternative crops for abandoned paddy lands, promotion of floriculture and aquaculture, construction and maintenance of agricultural roads and modernization of provincial agricultural farms and training centtres. Further, production of bio-fertilizer and organic fertilizer and promotion of organic farming at commercial and household levels need to be a special concern. To ensure the sustainability of the sector, it should be adequately mechanized addressing addressing labor shortage and advancement of technology. Particular attention should be made to achieve sustainable economic growth ensuring food security and to sustain drive of competiveness of agriculture and agro based products in the international market.

16. Livestock
It is intended to improve the supply of milk, eggs and meat to the public through maintaining a healthy and productive animal population in the province ensuring nutritional status and high level of income in the sector. In this regard, special attention has to be paid to ensure efficient delivery of veterinary services to farms, facilitate small and medium scale commercial livestock farms, promote value added industries, facilitate milk collection and storage needs promote high productive animals.

17. Inland Fisheries
Increase fish production, improving marketing facilities and promoting ornamental fish cultivation to be given priority. Measures to be taken to provide required technology to fishermen with the assistance of the National Aquaculture Development Authority (NAQDA). It is necessary to strengthen the fisheries societies and improve their management enabling rural community to become entrepreneurs using inland fish. It is required that fishing community be supported through providing fishing gears and equipment. There initiatives would help to enhance the accessibility of rural community to fish products to meet their nutritional needs.

18. Irrigation
Action need to be taken to ensure adequate water for cultivable lands of existing irrigation structures. Rehabilitation and development, construction of irrigation structures, systematic water management and securing maximum participation of the Farmer Organizations are essential features of this process. To make this development effort effective, paying attention on “Ancient Cascade system” would be vital. Irrigated water for other field crops, in addition to paddy should also be provided through optimum water management practices. Necessary steps to be taken for water sources to be free from pollution with agro chemicals and industrial wastes. Appropriate programmes need be organized to educate farmers on the importance of efficient water management.

19. Rural Development
The funds need to be provided for the activities such as development of rural roads, small bridges, culverts, rural market facilities, cemeteries, libraries and community water supply. It is required to maintain a better co-ordination with Local Authorities and Divisional Secretaries when projects are designed and implemented. It is suggested to works closely, with the industrial Development Board, Export Development Board to obtain the assistance on new technology and finding markets. When implementing such projects, it is necessary to secure involvement of voluntary organization and community-based organizations at local level for sustainability of projects.

20. Small Industries
Action is needed to improve the business conditions of SMEs and develop their competitiveness, entrepreneurship development, technology transfer, productivity improvement, marketing development and awareness to grab comparative advantages. Further, it is necessary to encourage traditional products and quality items while maintaining market linkages and introducing new technologies. Proper co-ordination with financial institutions and the institutions such as the Chambers of Commerce, National craft Council, and Industrial Development Board (IDB) are essential to develop this sector. Private sector participation could be encouraged for business ventures to enhance the efficiency. The certificates offered at the end of training programmes, organized by the Development of small industries should be in conformity with the NVQ framework.

21. Rural electrification
These funds can be utilized for providing extensions from the national grid in rural areas or providing feasible alternative energy schemes for such areas where electricity cannot be provided through national grid. Funds need to be used only for common extensions and not for individual connections when providing extensions from the national grid. In the provision of alternative power sources and organization of awareness program on economical use of electricity, proper coordination with the Sustainable Energy Authority need to be maintained.

22. Tourism
The government intends to develop this sector as an environmental and domestic culture friendly industry with extensive people’s participation. Diversified tourism product such as nature tourism, adventure tourism, agro-tourism, culture tourism, religious tourism, eco-tourism, wellness tourism and MICE tourism (Meetings, Incentives, Conferences and exhibitions) has to be promoted with emerging new trends. Further, different themes for tourism such as “Pottery Tourism Village”, “Handicraft Tourism Village” and “Coir Tourism Village” could be considered depending on their traditional practices and history. Key strategies should focus on improving related infrastructure and service facilities, directives for youth on relevant job opportunities, identifying lesser known attractions, developing facilities such as viewing decks, car parks, services areas, sanitation facilities, fresh water bathing facilities at sea bathing and inland water bathing places.

23. Local Government
- Local Authority Roads

Priority to be given for rehabilitation and timely maintenance of local authority roads. Depending on the situation, concreting or tarring the roads fully or partly should be done in order to ensure that local authority road network is functioning efficiently on sustainable basis. In special cases to avoid transport constraints gravelling is acceptable with proper justification.
- Community Water Supply

Safe drinking water and sanitation facilities should be provided using these funds. In the designing stage of new community water projects proper feasibility study should be carried out. In the provision of drinking water, the quality of the water needs to be certified by the National Water Supply and Drainage Board. It is necessary to maintain the common wells and bathing places on regular basis and keep them in hygienically suitable condition.
- Waste Management

Integrating 3R concept (reduces, re-use, recycle), priority should be given for implementation of activities like re-cycling of waste, producing compost, make use of waste for manufacturing products which have economic value. it is necessary to educate the people on 3R concept, further develop to sorting culture and disposal of degradable waste or product compost at the house hold level when there are enough spaces at households.

The activities such as libraries, crematoria, bus stands, weekly fairs, children’s parks which are not covered in the above sub-programmes under local government sector can be incorporated.

Flexible allocation
The funds under this category are allocated to attend urgent requirements which are not included in the original plan.
Grants for villages with special needs

The provincial authorities are expected to identify villages with difficulties due to non-availability of basic infrastructure facilities which create hardships to livelihood. The projects under these arrangements need to focus on providing facilities to overcome such unfavorable conditions. Problems highlighted by various media and organizations at provincial and national level could also be considered by the provinces for investment after studying relationality of those issues.

5. General guidelines

i. Master plans need to be developed for major sectors to avoid haphazard development activities and the development plan has to be based on that.
ii. Resource mapping exercises need to be carried out on sector basis to ensure tapping regional / location advantages and cater the disadvantaged communities.
iii. Provinces need to take every effort to complete the programmes / projects as planned out during the financial year of 2020 adhering to the performance-based budgeting system.
iv. Provincial authorities are responsible for adopting government procurement procedures in the implementation of development plans.
v. Based on logical need assessment, prioritization of projects is very important to optimal utilization of resources determining outcome while promoting allocative efficiency since funds are limited.
vi. In case, the completion of a project exceeds one year, it needs to phase out properly indicating funds to the ensuing years and review of previous year plan also important.
vii. For infrastructure projects, cost-benefit analysis needs to be adopted, while applying the cost-effective principle for social infrastructure projects.
viii. Before commission the projects, their feasibility, quality / standards and maintenance aspect should be given due consideration.
ix. For government building, as far as possible, “Type Plans” need to be adopted, depending on the terrain and climate of the area / location.
x. Due attention needs to be paid in construction of buildings or other structures with optimum utilization of space and avoiding unnecessary costs.
xi. If possible, financial contribution of the relevant stakeholders (e.g.: Local Authorities, NGOs, CBOs etc.) could be taken into account to reduce burden to the Government budget.
xii. For commercially viable projects, private sector participation could be encouraged whenever possible through suitable models. (e.g. PPP approach)
xiii. When creating common assets, under privileged areas need to be given priority.
xiv. Every effort needs to be taken to avoid duplication and overlapping of activities at national and provincial level programs coordination with relevant line ministries.
xv. relevant projects need to be designed to get maximum benefits for the people linking with programs and projects to be planned and implemented under the economic corridor development.
xvi. Data and information related to the Development Plan and its progress need to be made available Pay due attention to cross-cutting sectors among others commercial and trading enterprises, other income generating projects, environment, disaster prevention, women affairs (with attention on violence against women), youth affairs, since they have to be addressed through an integrated sectoral approach with special attendance to provincial list No. 21
xvii. Paying due attention to SDG 5 (indicator 5.C.1), projects need to be identified to promote women participation in the labor force through sufficient gender responsive budgeting and women’s empowerment and leadership. Further, as per the Cabinet Decision made on 09.03.2016, 25% of allocation has to be made available for women from the projects implemented for Rural Economic Development. Wherever applicable; Provincial Authorities need to maintain sex-disaggregated budget details for further analyses.
xviii. At the Paris Climate Conference (COP21) in December 2015, 195 countries including Sri Lanka adapted the first-ever universal, legally binding global climate deal. Accordingly, the provinces have to adapt the key elements of the Paris Agreement while paying attention on scale up their efforts and support actions to reduce emissions, build resilience and decrease vulnerability to the adverse effects of climate change and uphold and promote regional and international cooperation.
xix. Provincial Authorities need to pay attention on the Multi-Sectoral Framework called National Action Plan for Disabled (NAPD) in Sri Lanka for empowering differently abled persons. Hence, a satisfactory contribution has to be ensured to implement the NAPD paying special attention for improving of accessibility for people with disabilities adhering to Disabled Persons (Accessibility) Regulations, No.01 of 2006
xx. Considering and analyzing data of Socio-Economic indicators, lagging behind areas related to such indicators have to be identified and root causes of issues need to be addressed with fair distribution of funds for those areas with effort to minimize intra-regional disparities.
xxi. Each and every activity in the process of service delivery from need identification to results evaluation needs to adhere to the concept of citizens’ charter.
xxii. Considering National Physical Plan of Sri Lanka for relevant organizations for development of policies, designing of programs / projects through relevant studies.