LAHORE: The government is introducing reforms in the public finance management system for efficient allocation of resources and transparency in the budgeting process in the province, says Punjab Finance Minister Mohsin Khan Leghari.

Presiding over the review meeting of the Public Finance Management Reforms Strategy, he said the Punjab Public Finance Management Act 2022 is being introduced for implementation of reforms in the finance management system, which would be finally approved by the Punjab Assembly after approval of the Cabinet.

The purpose of the law is to legalise the guidelines laid down for budgeting. A draft of the Public Finance Management Act 2022 has been prepared by the finance department, which would be submitted to the cabinet committee after clearing the concerns of the law department.

The minister said that during the budgeting process under the Act, the allocation of funds based on outputs would be done. Along with the allocation of funds in the budget, their goals and the period of their achievement will also be determined, which will ensure improvement in the performance of the departments, he added.

The Act also included a chapter on fiscal risk aimed at controlling the budget deficit and it set a debt ceiling that would ensure soundness of the debt management system, he added.

The minister said funds lapsed every year, under the Act, would be made a part of the provincial fund and these funds would be utilised for the purposes for which they were earmarked.

Institutions running on government grants and subsidies would be made self-sustaining, he noted and added that under the Act, two accounts will be opened in the State Bank, one for the public fund and the other for the Treasury.

The revenue collected from the persistently loss-making institutions would be part of the treasury funds of the government. A single treasury account would improve the cash flow of the government and make the budget more efficient, he added.

Mr Leghari said the Act had also suggested reporting the assets of autonomous institutions so that the government knew where the money was coming from. In addition to this, the frozen assets in the accounts of the institutions would be mobilised to increase government resources, he said.

Published in Dawn, October 26th, 2022