Dar empowered to issue auxiliary budgets

Minister no longer needs PM’s concurrence for sanctioning supplementary budgets

ISLAMABAD: The federal cabinet has authorised Finance Minister Ishaq Dar to issue supplementary budgets, sparking criticism from constitutional law experts who described the move as unlawful and against the spirit of a Supreme Court judgment aimed at reinforcing democratic values in government decision-making.

In early February, the cabinet also authorised Dar to appoint heads of government-owned institutions working under the finance ministry. But legally, the finance minister can only appoint heads of these bodies and the deputy governor of the State Bank of Pakistan with the prime minister’s concurrence. Now the finance minister would not need the prime minister’s concurrence for sanctioning the supplementary budget.



Barrister Ali Zafar said the cabinet’s decision is unlawful, because the Supreme Court has already ruled that the cabinet’s powers cannot be delegated to any minister. Barrister Zafar served as amicus curiae in the case in which the apex court had given a landmark ruling in August last year.

The cabinet’s move comes at a time when politically-elected governments tend to loosen up the public purse for their voters. This week, the federal government approved Rs16.9 billion for extending the Metro bus route to New Islamabad International Airport, despite the fact that there was no allocation for this scheme in this fiscal year’s Public Sector Development Programme (PSDP).

The finance ministry moved the summary for securing the cabinet’s approval for delegating its authority to the finance minister “for expeditious disposal of certain procedural, administrative and statutory cases”.

“The … decision … is against the spirit of the apex court judgment,” said Barrister Farogh Naseem, an eminent constitutional lawyer.

In August last year, the apex court had directed the cabinet to get full approval in all cases. The judgment, which clipped the prime minister’s powers on fiscal matters, had restored the constitutional structure of the trichotomy of power that the ruling PML-N severely compromised during its three-year rule.



The Supreme Court also ruled that the budgetary expenditure or discretionary governmental expenditure could only be authorised by the federal government – the cabinet and not the prime minister. The federal government had challenged the Supreme Court decision but the apex court rejected its review petition.

The apex court had ruled that the power to authorise expenditures “has been conferred not on the prime minister but the federal government, i.e., the cabinet”.

Citing Article 85 of the Constitution, the court stated that it conferred power, not even on the federal government, but on the National Assembly to make a grant in advance for a period not exceeding four months pending completion of the budgetary procedures laid down in Article 82, while Article 86 conferred similar power on the federal government but only after the dissolution of the National Assembly.

According to the cabinet’s decision, the finance minister would now have the authority to grant a supplementary budget on a case-by-case basis and without any limit.



The cabinet also authorised the finance secretary to issue a supplementary budget of up to Rs100 million without the federal cabinet’s prior approval.

Over the past three years, the finance ministry had issued supplementary budgets for buying expensive luxury vehicles for the prime minister, giving subsidies to sugar barons, including politicians from across the political divide and funding various politically-motivated projects.

Because of the misuse of powers in connection with issuing supplementary budget, the International Monetary Fund (IMF) had urged the government to amend the Constitution, necessitating parliament’s prior approval before obtaining a supplementary budget.

But the government has not accepted the IMF’s proposal.

Getting supplementary budgets is extremely easy right now. The finance ministry informs the National Assembly about the extent of supplementary grants at the time of the next year’s budget approval, limiting the National Assembly’s role to just a debating club.

In the last fiscal year (2015-16), the government issued a regular supplementary budget of Rs102 billion and informed parliament after spending the amount. Between June 2013 and June last year, the PML-N government issued supplementary budgets amounting to Rs306 billion.

The finance ministry defended the cabinet’s decision to delegate powers to the finance minister.

A senior ministry official said the cabinet could delegate its powers to authorise expenditures to a minister. He said the cabinet could not delegate powers relating to levying taxes.

However, Ali Zafar differed. He said the Supreme Court ruling had not differentiated between expenditures, taxes or even administrative matters. “Wherever it is written federal government, it means the prime minister and all ministers,” said Ali Zafar.

In its landmark judgment, the apex court had declared the Rule 16(2) of Rules of Business of 1973 ‘ultra vires’, which enabled the prime minister to bypass the cabinet.

According to the ruling, neither a secretary, nor a minister and nor the prime minister were the federal government and the exercise, or purported exercise, of a statutory power exercisable by the federal government by any of them, especially, in relation to fiscal matters, was constitutionally invalid and a nullity in the eyes of the law.

Published in The Express Tribune, March 12^th, 2017.