Austerity drive: Govt claims new budget will save Rs40b

No details as to how the cuts would be implemented have been given.

ISLAMABAD:

The Pakistan Muslim League-Nawaz government has claimed that the austerity initiative introduced in the new federal budget will save the national exchequer Rs40 billion over fiscal year 2013-14.

But while cuts have been announced in the budgets for the prime minister’s office and government departments, no explanation as to how the cuts would be made was given. In addition to that, the budgets for the presidency, National Assembly and Senate have been jacked up, compared to the outgoing fiscal year.

In his speech, Finance Minister Ishaq Dar announced a 45% cut in the expenses of the prime minister’s office and a 44% cut in the budget of the Prime Minister House. He made it clear, however, that the cuts excluded the salaries and allowances of employees.

According to Dar, Rs396 million (excluding salaries and allowances) have been earmarked for the premier’s office for 2013-14, as opposed to the Rs725 million spent during 2012-13. Budget documents revealed that a total of Rs754.6 million have been reserved for the premier’s office, against the estimated Rs1.17 billion spent by the office during the outgoing fiscal year.

It should be noted, however, that previous Pakistan Peoples Party-led government had actually earmarked Rs702 million for the 2012-13 budget but ended up spending a whole lot more. The amount will now be approved by the NA as a supplementary budget – a practice that is abused every fiscal year.



The PML-N government announced it will not keep more than 40 ministries in order to curb expenses. Dar, in his speech, also announced that all discretionary funds previously available to federal and state ministers will be abolished.

Moreover, the PML-N government has also decided to abolish the Peoples Works Programme-II – the head used for the premier’s discretionary spending. According to Dar, however, Peoples Works Programme-I, which allots discretionary funds to all members of Parliament, has been retained.



The PML-N government also announced a 30% reduction in the overall expenditure of all government departments, excluding the obligatory expenses of debt servicing, grants and pays and allowances of civil servants. The government also revived a ban on imports of luxury vehicles for VVIPs.

Without elaborating on these measures, Dar claimed they would save around Rs40 billion.

Budgets for NA, Senate and Presidency

Despite the announced austerity drive, the budgets of both houses of Parliament, along with the Presidency, have been increased.

Rs2.44 billion has been earmarked for the NA for 2013-14, out of which, Rs1.07 billion will be used for expenses which are not voted upon. Rs2.07 billion had been earmarked for the lower house for the outgoing financial year.

Similarly, Rs1.3 billion has been reserved for the upper house for the new fiscal year, against Rs1.2 billion for 2012-13.

A total of Rs689.6 million, meanwhile, has been earmarked for the Presidency. Of this, Rs348.89 million has been reserved under the head of the President’s Secretariat (Personal), while another Rs340.6 million has been allotted under President’s Secretariat (Public).

An amount of Rs616.7 million had been reserved for the Presidency initially for 2012-13. However, under revised estimates, the President will end up spending Rs798.5 million by June 30, when the outgoing fiscal year ends.

PM abolishes Public Affairs and Grievances wing

Prime Minister Nawaz Sharif on Wednesday dissolved the Public Affairs and Grievances Wing of the prime minister’s office.

According to the premier’s directives, the Ministry of Parliamentary Affairs will now deal with public affairs and grievances. All officials posted in the now defunct wing have been directed to report to the establishment division.

Published in The Express Tribune, June 13^th, 2013.