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ISLAMABAD: The Federal Cabinet has reportedly discussed possibility of starting hybrid system in the larger ministries/divisions through induction of the best talent from the private sector as top bureaucracy was not geared to meet the challenges posed by modern day hyperkinetic environment, sources close to the Finance Minister told Business Recorder.

This idea was floated at a meeting of Federal Cabinet on January 4, 2022, during discussion on a summary of the Finance Ministry about publication of Statement of Contingent Liabilities with Finance Supplementary Bill.

The Finance Division apprised the Federal Cabinet that the Federal Government was required to lay before the National Assembly “Statement of Contingent Liabilities” as part of “Annual Budget Statement” under section 4, sub-section 3(a) of the Public Finance Management Act, 2019. Section 2(h) of the said Act defined ‘contingent liability’ as ‘a financial liability that may arise or come into being if one or more events occur.’

In June 2021, Federal Government laid in the National Assembly the “Statement of Contingent Liabilities” along with Annual Budget Statement for fiscal year 2021-22. It provided information about summary of the total outstanding government guarantees, domestic and external along with sector wise share.

The Cabinet was informed that subsequent to the staff level agreement reached after the recently concluded 6th review under Extended Fund Facility with IMF, a list of Guarantees that Federal Government expected to issue during the remainder of the Financial Year 2021-22 had to be laid before the National Assembly and published. This list would be treated as a ceiling for this period.

Finance (Supplementary) Bill, SBP (Amendment) Bill: NA session adjourned again

Finance Ministry stated that since Supplementary Finance Bill being laid (now already laid)) in the National Assembly to meet the agreed prior action under IMF 6th review, proposing that the additional “Statement of Contingent Liabilities” may also be laid in the National Assembly as agreed with the IMF. This proposal required approval of the Federal Cabinet as per Rule 16(c) of the Rules of Business, 1973.

During discussion, it was inquired as to whether the KCR, ML-I and Hyderabad-Sukkur motorway projects were also included. Minister for Finance & Revenue clarified that these three projects were not factored in. The Minister for Planning, Development & Special Initiatives apprised that KCR and Hyderabad-Sukkur motorway projects were important, and at a fairly advanced stage, so whenever there was room, their Guarantees should be issued.

Some of the Cabinet Members maintained that there is need to switch to accrual accounting from the cash accounting method, presently prevalent in the federal government, to give a more accurate picture of the liabilities. The Minister for Finance & Revenue clarified that for this necessary structure had to be created first, which included appointing professional CFOs in the Ministries/Divisions.

Sharing his anecdotal experience, the Special Assistant to the Prime Minister on National Security and Strategic Policy Planning, underlined the requirement for identifying 4-5 key steps, which the government could undertake to attract, facilitate and retain the overseas Pakistanis’ talent. It was suggested that CCIR should deliberate on this issue and submit recommendations.

The members fretted that the bureaucracy, especially at the top level, was not geared to meet the challenges posed by modern day hyperkinetic environment. There was thus a need to bring in specialists/professionals from the diaspora and private sector to find bold and out-of-the-box solutions to the problems being faced by the government. It was suggested that, to start with, a hybrid system could be introduced in the larger Ministries/Divisions through induction of the best talent from the private sector. A member drew the attention of the forum to the lack of incentives and low salaries of the senior bureaucrats as compared to the provincial governments and the private sector, which was the main cause for better resources not serving in the Ministries/Divisions.

The Special Assistant to the Prime Minister on Establishment pointed out that the system of performance agreement introduced by the government had made a positive difference in the functioning of the top bureaucracy. Furthermore, implementation of the Directory Retirement Rules would also help in weeding out the deadwood from the civil service. The Prime Minister directed the Special Assistant to the Prime Minister to update him on the progress made by. the Ministries/Divisions on the implementation of Directory Retirement Rule.

Copyright Business Recorder, 2022

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