ISLAMABAD:
The International Monetary Fund (IMF) has urged Pakistan to channel funding for parliamentarians’ projects through the regular approval process, abandoning the current special treatment. The IMF also stressed that mid-year budget adjustments should not be made without prior approval from Parliament.
In its Governance and Corruption Diagnosis Assessment report, the IMF highlighted the importance of publishing a budget strategy paper six months before the budget presentation, a practice the finance ministry has routinely neglected. The report, which the government is expected to release officially by the end of this month, also recommended integrating parliamentarians’ projects into the Public Sector Development Programme (PSDP) to enhance transparency, efficiency, and cost-effectiveness.
Currently, unlike projects approved by the Central Development Working Party or the Executive Committee of the National Economic Council, parliamentarians’ schemes are cleared by a Steering Committee on SDGs Achievements Programme, chaired by Deputy Prime Minister Ishaq Dar, with minimal scrutiny. These are small-scale community welfare projects, often falling under local government responsibilities, except for electricity and gas provisions.
Last fiscal year, the government spent at least Rs61 billion on these parliamentarians’ schemes, with Rs70 billion allocated for the current fiscal year. Critics within Pakistan have raised concerns that funding these projects outside the PSDP could lead to wastage and underutilization of approved budgets.
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The IMF also recommended capping allocations for new PSDP projects at 10% of total funding, cautioning against overextending resources on new initiatives while existing projects remain incomplete, often taking over a decade to finish. It called on the Ministry of Planning to rationalize the PSDP portfolio, focusing on high-priority projects, as political considerations have distorted allocations, with funds sometimes spent on projects outside the federal government’s jurisdiction.
Additionally, small-scale schemes run through the PSDP are often mismanaged, further raising concerns over transparency and accountability. The planning ministry declined to comment on the report.
The IMF concluded that Pakistan’s overall public finance management remains weak, and there is limited commitment from the government to ensure transparency or involve the Cabinet and Parliament in pre-budget discussions.