ISLAMABAD: The Ministry of Finance (MoF) has tightened fiscal controls to limit budgetary slippages ahead of a quarterly review with the International Monetary Fund (IMF).
MoF made this move in response to the financial autonomy claimed by the federal government’s corporate and autonomous entities and executive departments.
The ministry has issued new instructions, restricting all federal ministries, divisions, and their attached and subordinate offices, corporations, corporate entities, and executive departments from creating any charge or liability.
These instructions have been issued for strict compliance after these institutions claimed financial autonomy, asserting that their boards are competent to make their own financial decisions.
In light of frequent decisions by these bodies to sanction new allowances or enhance rates of existing ones, the MoF has committed to the IMF not to allow any increase in employee-related expenditure, including salaries, pensions, or allowances, during the current fiscal year.
The ministry referred to rule 12 of Rules of Business (RoB) 1973, which mandates that no division shall authorise the issue of any orders affecting the finances of the Federation without previous consultation with the Finance Division.
Under these provisions, fresh policy instructions have been issued to all entities, including the Auditor General of Pakistan (AGP) and Accountant General of Pakistan Revenue (AGPR), for strict compliance.
The new orders clarify that even the presence of a representative of the Finance Division on the board of an office does not constitute consultation with the Finance Division.
All offices are required to deposit their annual surpluses in the Federal Consolidated Fund (FCF) promptly under the provision of their laws as well as the Public Finance Management Act 2019.
The ministry has ordered the AGPR and budget and expenditure wings of the Ministry of Finance to undertake a review of the existing expenditures of these entities, including pay and allowances, and track any such expenditure that lacks the MoF’s approval.
Any payments not following these instructions are to be discontinued, and this exercise is to be completed within 30 days.
In cases requiring clarity, the expenditure is to be stopped immediately, and the matter is referred to the MoF. This move underscores the government’s commitment to fiscal responsibility and transparency.
