Islamabad: The country’s state authorities have issued a PKR 202 billion cash surplus generated in the first quarter of the current fiscal year (FY2019-20) to the federal government, according to news sources. As per officials, the provincial governments provided this aid to the central executive in order to facilitate it in meeting the fiscal targets set by the International Monetary Fund (IMF).
According to details, the provinces offered more than one-fourth of the funds assigned under their total revenue share out of the federal divisible pool. And by so doing, the provinces over-performed by refunding a cumulative refund of PKR 202 Billion (almost 48%) in a quarter against an annual benchmark of PKR 423 billion, set for FY2019-20.
As per the data released by the finance ministry, the cumulative revenues available to the provinces amounted to PKR 791 billion (including joint share of PKR 612.5 billion out of federal revenues and PKR 104.5 billion collected in provincial taxes). The provinces spent only PKR 589 billion (including PKR 70.6 billion spend in development schemes) and returned the PKR 202 billion.
This constrained spending behaviour is to comply with IMF conditions and show a strong commitment to support the government’s efforts and improve the quality and efficiency of public spending.
The government has given a written undertaking to the IMF; declaring that fiscal consolidation and revenue expansion strategies would be an essential aspect of its fiscal strategy.
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