ECC allows private sector to import wheat
ECC eases borrowing limits for provinces by up to 167% to meet expenditures
ECC agreed that there would be no limit on import of wheat by private sector and it would monitor the situation monthly. PHOTO: ONLINE
ISLAMABAD:
The federal government on Monday approved the import of wheat and relaxed borrowing limits for provinces by up to 167% to allow them to meet expenditures that often exceed cash in hand due to limits imposed under the International Monetary Fund (IMF) agreement.
The Economic Coordination Committee (ECC) of the cabinet gave the go-ahead to the private sector for wheat import to control prices of wheat and flour that had been constantly rising amid farmers’ reluctance to bring their crop to the market on expectations of further increase in prices.
In case, the private sector did not import wheat, the ECC decided that the government would then import the commodity to meet shortfall. The committee did not take up the summary for approval of new performance reward policy for government employees after the finance ministry decided to withdraw the summary. The finance ministry had suggested up to three salaries in reward for all government departments and the decision on budget honorarium had been left with the finance adviser.
Provincial borrowing
The ECC approved a new lending policy for provincial governments for their “ways and means” requirement and the signing of agreements by the Finance Division and the State Bank of Pakistan (SBP) to implement the lending policy, according to an official announcement. The committee further relaxed borrowing limits for provinces in the range of 108% to 167%.
Under the new policy, the ways and means limit for Punjab has been increased from Rs37 billion to Rs77 billion, a relaxation of 108%. The Sindh government has been allowed to borrow Rs39 billion from the central bank against the current ceiling of Rs15 billion, an increase of 160%.
Khyber-Pakhtunkhwa’s borrowing ceiling has been relaxed from Rs10.1 billion to Rs27 billion, higher by 167% and Balochistan’s ceiling has been relaxed from Rs7.1 billion to Rs17 billion, an increase of 140%.
Under the National Finance Commission (NFC) Award, provincial governments receive their share in federal taxes twice a month. Provinces are also required to show cash surplus against the money they receive under the NFC to meet International Monetary Fund (IMF) targets. This often results in higher expenditure than available revenues, so the government allows provinces to borrow from the Centre to enable them to honour their cash surplus commitment.
Wheat import
The ECC allowed the private sector to enter the market and ensure availability of wheat and flour at reasonable prices across the country throughout the year.
The ECC agreed there would be no limit on the import of wheat by the private sector and it would monitor the situation on a monthly basis to ensure availability of wheat and flour in all parts of the country at reasonable prices.
“If there is no import by the private sector, then the government should import wheat itself,” the ECC decided. The Pakistan Tehreek-e-Insaf (PTI) government’s permission for unchecked wheat export last year, some of the quantity in violation of a ban imposed at a later stage, has proved costly for the citizens, who are now being forced to pay higher prices.
The ECC decided that provincial governments should be requested to announce their wheat release policy immediately. Punjab has been asked to release 900,000 tons of wheat to flour mills of the province over the next two months at a price proposed by the provincial government.
The ECC said the government of Sindh should also be requested to announce its policy and Pakistan Agricultural Storage and Services Corporation (Passco) should assess immediate requirement of Khyber-Pakhtunkhwa and Balochistan and improve wheat supply as per agreed targets. It gave directives for stopping cross-border movement of flour to ensure that the commodity did not flow out to Afghanistan and the points of exit.
Performance rewards
The ECC did not take up a summary for the performance reward policy that the finance ministry had prepared. The ministry decided to withdraw the summary that proposed one annual performance reward by all ministries, two performance rewards for up to 10% of the employees and three performance awards to a maximum 5% of the employees.
Dr Aftab Iman, a grade-21 officer of the Federal Board of Revenue (FBR), last month approved up to 36-month salary in reward. The FBR found his decision irregular but has not yet fixed responsibility on the officer. The finance ministry’s summary suggested that the budget honorarium decision for the PM Office, Finance Division, Revenue Division, Economic Affairs Division and Planning Division should be left with the finance adviser without imposing any limit.
Supplementary budget
The ECC allowed the Capital Development Authority (CDA) to transfer 45 acres of land to the Inter-Services Intelligence at the 2009 rate of Rs2,250 per square yard. The CDA had wanted to charge the 2014 rate of Rs7,275 per square yard that could have cost the ISI Rs1.6 billion.
“The ECC allowed the Capital Development Authority to collect charges against allotment of 45 acres of land in Jagiot Farm, Islamabad to the Directorate General of ISI as per Rs2,250 per square yard rate with the total implication of Rs490.05 million, as already approved by the prime minister in May 2018,” said the finance ministry. The ECC also approved Rs490.05-million supplementary budget for the purpose, it added.
In 2004, former prime minister Shaukat Aziz had approved the allotment of 12 acres of land to the ISI in Chak Shahzad, 12 acres in Ali Pur Farash and 45 acres in Jagiot. The other two pieces of land have already been transferred but 45 acres could not be transferred due to a dispute over the land price.
The ECC approved Rs2.5 billion in supplementary grant for clearing the accrued verified liabilities of Punjab Mass Transit Authority (PMA) as the federal share on account of operation of Pakistan Metro Bus System. The ECC also approved Rs1.3 billion in supplementary budget to meet critical demand related to medical stores and utilities for the Pakistan Navy.
Published in The Express Tribune, June 23rd, 2020.
The federal government on Monday approved the import of wheat and relaxed borrowing limits for provinces by up to 167% to allow them to meet expenditures that often exceed cash in hand due to limits imposed under the International Monetary Fund (IMF) agreement.
The Economic Coordination Committee (ECC) of the cabinet gave the go-ahead to the private sector for wheat import to control prices of wheat and flour that had been constantly rising amid farmers’ reluctance to bring their crop to the market on expectations of further increase in prices.
In case, the private sector did not import wheat, the ECC decided that the government would then import the commodity to meet shortfall. The committee did not take up the summary for approval of new performance reward policy for government employees after the finance ministry decided to withdraw the summary. The finance ministry had suggested up to three salaries in reward for all government departments and the decision on budget honorarium had been left with the finance adviser.
Provincial borrowing
The ECC approved a new lending policy for provincial governments for their “ways and means” requirement and the signing of agreements by the Finance Division and the State Bank of Pakistan (SBP) to implement the lending policy, according to an official announcement. The committee further relaxed borrowing limits for provinces in the range of 108% to 167%.
Under the new policy, the ways and means limit for Punjab has been increased from Rs37 billion to Rs77 billion, a relaxation of 108%. The Sindh government has been allowed to borrow Rs39 billion from the central bank against the current ceiling of Rs15 billion, an increase of 160%.
Khyber-Pakhtunkhwa’s borrowing ceiling has been relaxed from Rs10.1 billion to Rs27 billion, higher by 167% and Balochistan’s ceiling has been relaxed from Rs7.1 billion to Rs17 billion, an increase of 140%.
Under the National Finance Commission (NFC) Award, provincial governments receive their share in federal taxes twice a month. Provinces are also required to show cash surplus against the money they receive under the NFC to meet International Monetary Fund (IMF) targets. This often results in higher expenditure than available revenues, so the government allows provinces to borrow from the Centre to enable them to honour their cash surplus commitment.
Wheat import
The ECC allowed the private sector to enter the market and ensure availability of wheat and flour at reasonable prices across the country throughout the year.
The ECC agreed there would be no limit on the import of wheat by the private sector and it would monitor the situation on a monthly basis to ensure availability of wheat and flour in all parts of the country at reasonable prices.
“If there is no import by the private sector, then the government should import wheat itself,” the ECC decided. The Pakistan Tehreek-e-Insaf (PTI) government’s permission for unchecked wheat export last year, some of the quantity in violation of a ban imposed at a later stage, has proved costly for the citizens, who are now being forced to pay higher prices.
The ECC decided that provincial governments should be requested to announce their wheat release policy immediately. Punjab has been asked to release 900,000 tons of wheat to flour mills of the province over the next two months at a price proposed by the provincial government.
The ECC said the government of Sindh should also be requested to announce its policy and Pakistan Agricultural Storage and Services Corporation (Passco) should assess immediate requirement of Khyber-Pakhtunkhwa and Balochistan and improve wheat supply as per agreed targets. It gave directives for stopping cross-border movement of flour to ensure that the commodity did not flow out to Afghanistan and the points of exit.
Performance rewards
The ECC did not take up a summary for the performance reward policy that the finance ministry had prepared. The ministry decided to withdraw the summary that proposed one annual performance reward by all ministries, two performance rewards for up to 10% of the employees and three performance awards to a maximum 5% of the employees.
Dr Aftab Iman, a grade-21 officer of the Federal Board of Revenue (FBR), last month approved up to 36-month salary in reward. The FBR found his decision irregular but has not yet fixed responsibility on the officer. The finance ministry’s summary suggested that the budget honorarium decision for the PM Office, Finance Division, Revenue Division, Economic Affairs Division and Planning Division should be left with the finance adviser without imposing any limit.
Supplementary budget
The ECC allowed the Capital Development Authority (CDA) to transfer 45 acres of land to the Inter-Services Intelligence at the 2009 rate of Rs2,250 per square yard. The CDA had wanted to charge the 2014 rate of Rs7,275 per square yard that could have cost the ISI Rs1.6 billion.
“The ECC allowed the Capital Development Authority to collect charges against allotment of 45 acres of land in Jagiot Farm, Islamabad to the Directorate General of ISI as per Rs2,250 per square yard rate with the total implication of Rs490.05 million, as already approved by the prime minister in May 2018,” said the finance ministry. The ECC also approved Rs490.05-million supplementary budget for the purpose, it added.
In 2004, former prime minister Shaukat Aziz had approved the allotment of 12 acres of land to the ISI in Chak Shahzad, 12 acres in Ali Pur Farash and 45 acres in Jagiot. The other two pieces of land have already been transferred but 45 acres could not be transferred due to a dispute over the land price.
The ECC approved Rs2.5 billion in supplementary grant for clearing the accrued verified liabilities of Punjab Mass Transit Authority (PMA) as the federal share on account of operation of Pakistan Metro Bus System. The ECC also approved Rs1.3 billion in supplementary budget to meet critical demand related to medical stores and utilities for the Pakistan Navy.
Published in The Express Tribune, June 23rd, 2020.