Govt forms austerity committee in bid to rein in runaway expenditure

The government has constituted a 10-member committee to ensure the implementation of austerity measures, as it sought to cut expenditures to reduce fiscal debt, it emerged on Friday.

The move comes as Pakistan is seeking the resumption of the IMF’s extended fund facility and to that end, has committed to reducing the fiscal deficit.

According to the Finance Division notification dated July 7, a copy of which is available with Dawn.com, the finance minister will be the chairman of the committee.

It will also comprise the minister for planning, minister for communication, minister for commerce, minister for maritime affairs and the minister of state for finance. The secretaries from the ministries of finance, planning and industries will also be part of the committee alongside the additional finance secretary.

The terms of reference of the committee include periodically reviewing and ensuring the implementation of austerity measures and related matters for financial year 2022-23.

The body will also invite proposals from principal accounting officers for curtailing expenditures, and approve proposals for relaxing the approved measures.

It will constitute a separate committee for reviewing the need and utility of autonomous bodies, state-owned enterprises, corporations and authorities.

Last month, the government had announced several austerity measures amid in an effort to conserve electricity amid a drastic shortfall. The austerity plan was approved in a cabinet meeting presided over by Prime Minister Shehbaz Sharif.

Among the more significant measures was an announcement that foreign trips for officials would be sharply curtailed while fuel quotas for government employees would be cut by 40 per cent.

It was decided that purchase of vehicles, except for utility vehicles such as ambulances and school buses, at the government level will be restricted, and ‘unnecessary’ foreign visits, including visits abroad for medical treatment, would be banned for government officials.

It was also decided that priority would be given to holding government meetings virtually till an energy conservation plan is approved by the federal cabinet. The cabinet also decided to cut the consumption of utilities at the government level and in offices by 10 per cent.

Meanwhile, the Finance Division issued an office memorandum, also dated July 7, noting that extraordinary measures needed to be taken for ensuring “rational utilisation of public money” in addition to curtailing expenditures to reduce fiscal debt.

The notification reiterated the ban on purchasing all types of vehicles and treatment abroad at the government’s expense. It also banned the creation of new posts and appointment of daily wagers except for those required for development projects.

The ban also applies to purchasing office furniture, machinery and equipment and unnecessary official visits abroad by government functionaries.

Principal accounting officers have also been told to reduce consumption of utilities by 10pc and for avoidable travel to be curtailed by promoting online meetings.

The federal government also decided to slash petrol usage of ministers’ vehicles by 40pc and of security vehicle of cabinet members by 50pc, the memorandum said.