ISLAMABAD, August 27, 2024 – Prime Minister Shehbaz Sharif emphasized the urgent need for economic reforms and cost-cutting measures, stating that Pakistan cannot afford to let the bureaucracy and elite enjoy luxuries at the expense of taxpayers.
This statement came as the federal cabinet approved the continuation of an austerity drive aimed at reducing government expenditure and improving governance.
During a meeting of the federal cabinet, PM Shehbaz called on all ministries and institutions to prioritize national interests by adopting measures that save every penny. “In view of the larger national interests, all ministries and institutions should take all possible decisions and initiatives that could save each penny of the nation,” he said.
The prime minister highlighted ongoing efforts to enhance governance and implement institutional reforms across the country. He noted that digitization and smart management practices are being introduced to modernize Pakistan’s administrative systems and align them with international standards. “We are introducing digitization and smart management of institutions to modernize the country’s system and harmonize it in accordance with international requirements,” PM Shehbaz stated.
The prime minister commended the efforts of the finance minister, the minister for national food security, the minister for energy, and other relevant officials for ensuring the uninterrupted supply of urea fertilizer for the upcoming Rabi crop. As a result of these measures, the country saved $130 million by halting the import of urea and ensuring continuous gas supply to domestic fertilizer units.
The cabinet also discussed proposals from the Ministry of Housing and Works concerning the dissolution of the Pakistan Public Works Department (PWD) and the transfer of its staff and ongoing projects to other ministries and institutions. The meeting was informed that, following the prime minister’s directives, necessary maintenance staff and inquiries are being transferred to relevant ministries and provincial governments to ensure the seamless continuation of development and Public Sector Development Programme (PSDP) projects managed by PWD.
The federal cabinet approved the Ministry of Housing and Works’ recommendations, marking a significant step toward optimizing resources and improving efficiency in public projects.
Further, the cabinet reviewed the recommendations of the Rightsizing of the Federal Government Committee, established for Institutional Reforms and led by the finance minister. The cabinet was briefed that to enhance the federal government’s performance, better utilization of manpower, removal of unnecessary obstacles in policy-making, and the strengthening of key departments, the initial phase of the committee’s recommendations concerning six ministries had already commenced.
As part of this reform initiative, 82 government bodies associated with these ministries are set to be merged or dissolved into 40 institutions. This consolidation aims to promote digitization, smart management, efficient governance, and faster project implementation, ultimately benefiting the public with better services.
The cabinet also agreed to form a committee to protect the interests of employees affected by these mergers and dissolutions. This committee will oversee the smooth transition of staff and ensure their rights are safeguarded during the restructuring process.
A detailed briefing was provided on the ongoing austerity drive and the implementation of measures under the prime minister’s directives to cut government spending. The federal cabinet reaffirmed its commitment to the austerity drive initiated during PM Shehbaz’s previous term. Key measures include voluntary non-withdrawal of salaries by cabinet members, a ban on purchasing government vehicles except for essential services like ambulances, restrictions on buying new equipment and machinery, a freeze on creating new government posts, a ban on non-essential foreign travel, and a prohibition on medical treatments abroad at government expense.
PM Shehbaz urged all ministers to ensure that these austerity measures are strictly enforced within their respective ministries and institutions. He also praised their efforts in implementing these cost-cutting measures.
Additionally, the cabinet endorsed the decisions made during the Economic Coordination Committee (ECC) meeting held on August 22, 2024, further solidifying the government’s commitment to financial prudence and economic reform.
