PM Shahbaz unveiled a slew of austerity measures aimed at saving Rs200 billion in order to keep the country afloat as it works to meet the International Monetary Fund’s (IMF) conditions.
Pakistan is desperate to unlock the next tranche of its $1.1 billion loan facility with the IMF, but it is struggling to meet the global financier’s stringent conditions.
The IMF is demanding that Pakistan increase its pitifully low tax base, eliminate exemptions for the export sector, and raise artificially low energy prices intended to assist poor families.
The country is in desperate need of funds as it fights a devastating economic crisis, with the State Bank of Pakistan’s (SBP) foreign exchange reserves barely covering one month’s imports.
Addressing a press conference flanked by cabinet members, PM Shahbaz announced that the ministers and advisers to the premier have “voluntarily” decided not to take salaries from the government in order to save millions from the national exchequer.
The measures
- All federal ministers, state ministers, advisers, and special assistants have decided to voluntarily not take their salaries;
- All ministers will pay their power, telephone, water, and gas bills through their own resources;
- All luxury cars are being taken back from cabinet members and will be auctioned;
- When necessary, ministers will be provided one vehicle for security;
- Government officials will travel in economy class and their assistants will not go with them on official tours;
- During foreign tours, cabinet members will not reside in five-star hotels;
- All ministries, divisions, departments, subdepartments, and independent organisations’ current expenditures will see a cut of 15%;
- Principal accounting officers of ministries, divisions, departments, subdepartments, and independent organisations will adjust their expenses accordingly;
- Government officials will not be allowed to buy luxury cars till June 2024;
- Government officials will only hold official tours if obligatory;
- Car allowances for government officers who already have official vehicles will be discontinued;
- Cars provided to government officers for security will be taken back;
- The interior ministry will decide which government officer gets security vehicles;
- Zoom conferences will be prefered instead visiting countries;
- No new department or division will be created, whether it be at the tehsil level or at the centre;
- To save power and gas, offices will open at 7:30 am and less power consuming appliances will be used;
- Government officers will not be allotted more than one plot;
- Only one dish will be eaten at government meetings, tea and biscuit will be served at other meetings;
- Prohibition of food will not be applicable to foreign dignitaries;
- Centre, provinces to cut power supply of malls and markets if they don’t shut down by 8:30pm;
- Townhouses will be constructed for ministers and government officers;
- A single treasury account will be established; and
- Toshakhana gifts’ details will now be available online.
