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ISLAMABAD: The Federal Cabinet has approved amendments in Financial Management and Powers of Principal Accounting Officers Regulations, 2021, meant also to designate any official as Principal Accounting Officer (PAO) of the Ministry or its attached departments.

At a recent meeting of Federal Cabinet, Finance Division stated that the Federal Government enacted Public Finance Management (PFM) Act 2019 and consequently the Financial Advisor’s Organization had been disbanded.

In order to implement the provisions of the PFM Act 2019 and in the light of approval granted by the Cabinet Committee on Institutional Reforms (CCIR) and the Federal Cabinet, Finance Division had framed regulations titled Financial Management and Powers of Principal Accounting Officers Regulations, 2021 (FM&PPAO Regulations 2021).

There were two provisions in Rules of Business 1973 that needed to be aligned with the FM&PPAO Regulations 2021 which are as follows:-(i) as per FM&PPAO Regulations 2021, officers other than Secretary could be nominated as PAOs, besides the regulations spell out the responsibilities of PAOs with reference to financial management.

This aspect was missing in Rule 5(9) (e) of Rules of Business 1973 and; (ii) the expenditure proposals relating to Finance Division were regulated as per Rule 11(g) of Rules of Business 1973, whereby a Joint Secretary of Establishment Division used to serve as Financial Advisor to Finance Division. According to FM&PPAO Regulations 2021, this arrangement had been done away with.

Existing provision - Rule 5 (9) The Secretary shall- (e) be the Principal Accounting Officer of his Division, its Attached Departments and Subordinate Offices, and ensure that the funds controlled by him were spent in accordance with the rules laid down by the Finance Division.

Proposed amendment —-Rule 5 (9) The Secretary should - (e) be the Principal Accounting Officer of his Division, its Attached Departments and Subordinate Offices. Any other official may also be designated as Principal Accounting officer as per section 2(q) of the Public Finance Management Act, 2019 and clauses 4 and 5 of the Financial Management and Powers of Principal Accounting Officers Regulations, 2021. A Principal Accounting Officer should be responsible for exercising financial propriety in management of public funds and having accountability to Parliament for the economic, efficient and effective use of resources.

Regarding Rule 11 ‘Consultation with the Establishment Division’, the revised rule will be as follows - No Division, shall, without previous consultation with the Establishment Division issue, or authorize the issue of, any orders, other than orders in pursuance of any general or special delegation made by the Establishment Division which involve:

Expenditure proposals relating to the Finance Division under rule 12(1) (b), (2) and (3) are omitted.

Copyright Business Recorder, 2022

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