have a formula-based allocation mechanism to the districts and is instead distributed in a more ad hoc manner.

**Figure 10: Per capita allocations in the districts ( 2006/07)**

<!-- Start of picture text --> Per capita education development allocations (Rs.) Per capita health development allocations (Rs.)<br>450 120<br>400<br>100<br>350<br>300 80<br>250<br>60<br>200<br>150 40<br>100<br>20<br>50<br>0 0<br>District Tied grants Province District Tied grants Province<br>Per capita roads development allocations (Rs.) Per capita water and sanitation development allocations (Rs.)<br>1000 500<br>900 450<br>800 400<br>700 350<br>600 300<br>500 250<br>400 200<br>300 150<br>200 100<br>100 50<br>0 0<br>District Province District Province<br>Bhakkar Bahawalnagar Chakwal Faisalabad Gujrat Hafizabad Jhang Jhelum Khushab Lahore M.B.Din Mianwali Narowal Okara Rajanpur R.Y.Khan Sialkot T.T.Singh Bhakkar Bahawalnagar Chakwal Faisalabad Gujrat Hafizabad Jhang Jhelum Khushab Lahore M.B.Din Mianwali Narowal Okara Rajanpur R.Y.Khan Sialkot T.T.Singh<br>Bhakkar Bahawalnagar Chakwal Faisalabad Gujranwala Gujrat Hafizabad Jhang Jhelum Kasur Khanewal Khushab Lahore Layyah M.B.Din Multan Mianwali Nankana Sahib Narowal Okara Pakpattan Rajanpur Rawalpindi R.Y.Khan Sargodha Sialkot Sheikhupura T.T.Singh Vehari Bhakkar Bahawalnagar Chakwal Faisalabad Gujranwala Hafizabad Jhang Jhelum Kasur Khanewal Khushab Lahore M.B.Din Multan Mianwali Nankana Sahib Rajanpur R.Y.Khan Sheikhupura T.T.Singh<br><!-- End of picture text --> _Source_ : Punjab P&D department and district governments In total therefore, the provincial ADP allocated Rs.7.6 billion and Rs.1.7 billion for primary and secondary school and health infrastructure, far greater than the Rs.1.1 and Rs.0.4 billion that the districts are spending in these devolved sectors. This predominance of provincial priorities at the local level is evident in Figure 10, which displays per capita allocations in education, health, roads, and water and sanitation by the district and provincial governments in districts on which data was available. Tied grants, the CMAPSD, and provincial schemes executed from Account 1 form by far the largest source of development expenditures in education and health in the districts for which data was available (Figure 10, top panels). On average these are five to six times the district allocations.

The provincial presence in the districts in the infrastructure sectors is also large, but not as predominant (Figure 10, bottom panels). In roads the province and districts are allocating on average roughly equivalent amounts, while in water and sanitation district allocations form a larger proportion.

It is not unreasonable to presume that these provincial interventions have an impact on the decision-making of local policy-makers. Credit claiming for a particular service becomes difficult if multiple tiers of government are providing the same service. This distortion can then create incentives for politicians to focus on targeted benefits or on more visible interventions.

Figure 11 provides some clues as to why districts are focusing on small-scale infrastructure. Since both the education and health tied grants are for the provision of missing facilities, there is 16