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Print Print 2024-06-01

Budget FY2024-25: Rs681bn earmarked for power tariff-related subsidies?

  • Announcement to be made with the condition that no supplementary budget, regular or technical will be provided
Published June 1, 2024

ISLAMABAD: The Ministry of Finance (MoF) has reportedly earmarked Rs 681 billion for power tariff-related subsidies for the FY 2024-25, to be announced in the federal budget with the condition that no supplementary budget, regular or technical will be provided, well-informed sources told Business Recorder.

The break-up of the proposed allocations for FY 2024-25 are as follows: (i) Tariff Differential Subsidy (TDS) Discos, Rs 276 billion; (ii) Agriculture Tube wells Balochistan (Qesco), Rs 9.5 billion; (iii) Agriculture Tube wells Balochistan, Rs 500 million; (iv) FATA subsidy, Rs 65 billion; (v) TDS-KE Rs 174 billion; (vi) Pakistan Energy Revolving Account (PERA), Rs 48 billion; and (v) AJK subsidy Rs 108 billion. However, amount of overall subsidy will be Rs 1.094 trillion for Financial Year 2024-25 for the power sector against Power Division’s demand of Rs 1.250 trillion.

Power sector: MoF agrees to extend Rs1.094trn subsidy

According to sources, following mandatory instructions shall be strictly and fully followed by all PAOs, heads of departments and bodies/entities while preparing budget estimates for each cost centre and head of accounts in the form of BOS and NISS: (i) PAOs are required to comply with the provisions of the PFM Act, 2019 regarding performance-based budgeting and expenditures by formulating well defined plans; (ii) guidelines and procedures contained in Financial Management and Powers of PAOs Regulations, 2021 and the BCC for FY2024-25 shall be adhered to; (iii) ensure adoption of Treasury Single Account (TSA) as per Section 30 of the PFM Act, 2019 read with Cash Management & TSA Rules, 2024; (iv) for Climate Sensitive Budgeting/Green Budgeting the information has to be filled for both current and development budget as per the typology defined in Form-IV. The cost centres related to green component shall also be identified while submitting the BOS/NISS; (v) KPIs related to gender and climate may also be identified separately in Performance-Based Budgeting (Form-1); (vi) PAOs, heads of departments and bodies/entities shall submit Quarter Wise Budget Estimates for FY 2024-25; (vii) PAOs shall make expenditures keeping in view the budgetary allocations without any assumption of additional allocation during the financial year. Supplementary budget, regular and technical, shall not be provided; (viii) austerity measures, as issued by Finance Division from time to time, shall be fully adhered to. No allocations shall be made for banned heads of expenditures. Such allocation, if made, shall be released after approval of the austerity committee; and (xi) ensure full allocation of rupee cover against all anticipated foreign grants and loans during the financial year. Any allocation subsequently requested for will be adjusted from within the funds provided.

Copyright Business Recorder, 2024

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Usman Jun 01, 2024 03:14pm
Use it to add more cheaper electricity and lets solve the problem once for all
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Mumtaz Malik Jun 01, 2024 03:29pm
Since 2005, the railway track from Malakwal to Bhera an ancient city has been closed. Consequently, the bus transporters' mafia has been profiting from this situation.
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