ISLAMABAD – Federal Finance Secretary Imdadullah Bosal has said the government expects to save Rs16.8 billion through its latest austerity measures, including a 50 percent reduction in fuel allocations for official vehicles.
Briefing the National Assembly Standing Committee on Finance, Bosal said reducing fuel supplies for government vehicles by half would save around Rs700 million over three months. A 5% reduction in non-salary expenditure for one year is expected to generate savings of around Rs16.1 billion.
The briefing was held as the committee reviewed progress during the first two years of Pakistan’s International Monetary Fund (IMF) programme.
Bosal, who is also the government’s chief negotiator in talks with the IMF, said overall implementation of the programme had been relatively strong. However, he acknowledged that some programme conditions had not been fully met.
He said three provinces had agreed to liberalise the sugar sector, while discussions were continuing with the fourth province over its reservations. The IMF condition required federal and provincial governments to agree on a national policy to liberalise the sugar market.
The policy was required to address reforms involving licensing, price controls, import and export permissions and zoning. However, the government could not secure approval of the policy by the June deadline.
Progress on the collection of agricultural income tax has also been slow, with the IMF holding discussions with the Sindh government on the issue.
Bosal further acknowledged that targets related to health and education spending had not been achieved because some provinces did not make the required expenditures.
Another IMF condition involving the alignment of laws governing nine additional state-owned entities with the State-Owned Enterprises Act also remained incomplete.
On anti-corruption measures, Bosal said the prime minister had tasked the federal law minister and the National Accountability Bureau with preparing action plans to reduce corruption risks in 10 government departments identified as having the highest risks.
