The Finance Ministry has decided to release subsidies allocated in the budget on a case-to-case basis during the current fiscal year.
The government has budgeted Rs. 700 billion for subsidies to provide relief to the common man during the current fiscal year.
Finance Ministry has devised a strategy for the release of funds for recurrent and development purposes. Under the new strategy, the federal government will release subsidies on a case-to-case basis during the current fiscal year.
According to the guidelines of the Finance Ministry, the Principle Account Officers (PAOs) concerned will prepare quarterly funds requirement plans for subsidies within the allocated budget for the current fiscal year and will share them with the relevant wings of the Finance Division before the start of each quarter. Finance Division may review the quarterly requirement plan and may convey its views and comments to the PAO concerned within two weeks.
While firming up its views and comments, Finance Division will consider inter-alia, fiscal space as well as cash balance availability. Release of funds by the PAO for subsidies will be made under the funds’ requirement plans, as modified considering Finance Division’s comments.
The sanction for expenditure will be issued by PAO concerned and a copy will be sent to Budget Wing, Finance Division for entry into the SAP System.
The federal government will release 20 percent of total allocated grants and lending during the first quarter (July-Sept), and 25 percent each during the second (Oct-Dec) and third quarters (Jan-March). However, the government will release the remaining amount during the fourth quarter (April-June) of the current fiscal year.
Funds for foreign exchange payments will require prior approval by the External Finance Wing of the Finance Division. While examining requests for such funds, the External Finance Wing will consider the availability of Foreign Exchange.
All payments will be made through the pre-audit system by all the Accounting Organizations and Offices or through Assignment Account Procedure or any other procedure issued by the Finance Division.
No direct payment through the State Bank of Pakistan (SBP) will be made by any office, except with the prior approval of the Finance Secretary as per Rules 3(2) and 3(3) of the Cash Management and Treasury Single Account Rules 2020.
Approved Direct Payments will be booked and recorded by the Accounting Organizations and Offices and Federal Treasury Offices immediately after receipt of intimation from SBP.
The special-purpose funds or any other fund established, managed, or controlled by the Ministries, Divisions, Departments, and Organizations of the Federal Government will be regulated in accordance with the Cash Management and Treasury Single Account Rules 2020.
