Is govt considering cutting salaries of govt employees by 10%?

cutting salaries of govt employees

Islamabad: Keeping in view Pakistan’s economic woes, reports have emerged that the federal government might cut the salaries of government employees by 10% across the board as the National Austerity Committee (NAC) is working to reduce public expenditure and ensure fiscal discipline.

According to a report published in The News, the NAC will finalize its recommendations on Wednesday (today) and send its report to Prime Minister Shehbaz Sharif for approval.

The report said that the NAC was proposing to reduce the number of ministers, ministers of state, advisers, and SAPMs to 30 only, while the remaining if required, should not enjoy any resources from the national exchequer. They should work on a pro bono basis.

The federal government constituted a 15-member National Austerity Committee last week to reduce public expenditures and to finalize recommendations about five major terms of reference (ToRs) to ensure “austerity” at the government level.

The development had come in a bid to persuade the International Monetary Fund (IMF) to release its $1.18 billion tranche under the ninth review of the current program with the global lender.

According to the same report, the NAC also recommended an end to utilizing funds of provincial nature projects and imposing a ban on public sector enterprises to secure loans through government guarantees and several others.

However, the NAC is reluctant to take up big ticket items for major expenditure cuts on budgetary resources, such as reducing the number of ministries/divisions after the 18th Constitutional Amendment, as overlapping of ministries/divisions and departments continues to work unabated.

Several overlapping ministries/divisions are working at the federal level and the Centre should restrict their number to five to six only, including defense, foreign affairs, finance, and security, while all other devolved ministries should be abolished.