Salaries cut, ‘unnecessary’ trips prohibited as PM unveils major austerity measures

Salaries cut, ‘unnecessary’ trips prohibited as PM unveils major austerity measures. Prime Minister Shehbaz Sharif on Wednesday unveiled austerity measures aimed to keep the country afloat as the nation buckles up to meet the International Monetary Fund’s (IMF) conditions.

Pakistan is desperate to unlock the next tranche worth $1.1 billion loan facility with the IMF but is struggling to meet tough conditions set by the global financier.

The IMF is demanding that Pakistan boosts its pitifully low tax base, end exemptions for the export sector, and raise artificially low energy prices that are meant to help poor families.

The nation is in dire need of funds as it battles a wrenching economic crisis as the State Bank of Pakistan (SBP)-held foreign exchange reserves barely cover one month of imports.

Read more: Sedition case registered against Shaukat Tarin for ‘sabotaging negotiations’ with IMF

Addressing a press conference flanked by the senior leadership of the Pakistan Democratic Movement (PDM), the premier 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 prime minister said that austerity measures were a priority for the coalition government, and the ongoing situation also demands the nation as a whole cut down their expenses and move towards a simple lifestyle.

He noted that ministers, advisers, and bureaucrats would have to take the lead in adopting austerity measures — in a bid to promote the values.

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;
• Interior ministry will decide which government officer gets security vehicles;
• Zoom conferences will be prefered instead of 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 7:30am 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 8:30am;
• Townhouses will be constructed for ministers and government officers;
• Single treasury account will be established; and
• Toshakhana gifts’ details will now be available online.

Premier’s press conference comes, two days after the National Assembly unanimously approved the government’s much-needed Rs170 billion ‘mini-budget’ — a move mandatory for seeking a $1.1 billion tranche of the IMF loan.