PTI-led federal cabinet approves Rs39 billion supplementary grants

Demand for such grants has increased, showing a lack of financial discipline, officials say

Zafar Bhutta March 31, 2019

ISLAMABAD: The Pakistan Tehreek-e-Insaf (PTI) led federal government has given a legal cover to Rs39 billion supplementary grants approved for the ongoing financial year 2018-19 due to excess in expenditures by different ministries and divisions.

During the Pakistan Muslim League-Nawaz (PML-N) government, the cabinet had delegated to the finance secretary and finance minister the powers to approve supplementary grants but the PTI government has withdrawn these powers.

Officials said the demand for supplementary grants by the ministries and divisions has increased considerably, showing a lack of financial discipline. They said the cabinet members expressed serious concerns over these demands and noted that each ministry and division should anticipate expenditure likely to be incurred during a financial year while preparing their budget estimates.

The Finance Division informed the cabinet in its recent meeting that Article 84 of the Constitution lays down the procedure for supplementary grants and excess grants.

It says the government shall have power to authorise expenditure in case the amount authorised for a particular service is found insufficient or a need has arisen for expenditure upon some new service not included in budget or money has been spent in excess of amount granted for that financial year.

It says the federal government shall submit before the National Assembly the statement of such expenditures in accordance with Articles 80 to 83 as they apply to annual budget statement.

A recent federal cabinet meeting, chaired by Prime Minister Imran Khan, was told that in February 2017 during the PML-N government, the cabinet on a summary moved by the Finance Division authorised the finance secretary to issue supplementary grant up to Rs100 million and finance minister to issue grants of amounts more than that.

But on August 29, 2018, the federal cabinet while considering removal of the National Bank of Pakistan’s (NBP) president and chief executive officer decided that law minister would analyse the case from legal perspective and give his opinion on delegation of powers by the cabinet. The Law Division later opined that the said delegation of powers to finance secretary and finance minister was not legal.

It was further informed that the supplementary grants of Rs39.06 billion were allowed to different ministries and divisions by the Finance Division before revision of procedure on October 15, 2018.

Now, the supplementary budget is granted with prior approval of the federal cabinet. The government was solicited for ex-post facto regularisation of supplementary grants for financial year 2018-19.

The cabinet considered the summary submitted by the Finance Division and in accordance with its proposal granted ex-post facto approval for regularisation of supplementary grants amounting to Rs39.06 billion for financial year 2018-19.