ISLAMABAD: Senators on Wednesday called for the abolition of ‘conflict of interest’ clauses in the laws regulating the State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP), which allow their top brass to set their own salaries and benefits without government approval.

At a meeting of the Senate Standing Committee on Finance and Revenue, chaired by Saleem Mandviwalla, Senator Anusha Rehman highlighted that the SBP Amendment Act 2022 granted the central bank’s board of directors the power to determine the salaries and perks of the governor and deputy governors, with the board itself being led by the governor.

She termed this arrangement a “serious conflict of interest” and argued that it undermined the authority of the government, cabinet, and Ministry of Finance.

Before the 2019 SBP law, the salaries of the SBP governor and deputy governors were set by the President on the recommendation of the Prime Minister, with the process originating from the Ministry of Finance. The committee was informed that under the amended law, the salary of then-governor Baqir Reza was initially set at Rs2.5 million per month, with a 10 per cent annual increment. The amended law later raised his salary to Rs4m.

Senator Rehman called for restoring the power to set these salaries to the government. She mentioned that she had already moved amendments to the SECP law and urged the government to do the same for the SBP law.

Demands abolition of ‘conflict of interest’ clauses in the laws

Senators also raised concerns about similar powers granted to the SECP chairman, which had come under scrutiny after an audit revealed the chairman’s benefits amounted to Rs381m.

This sparked questions about the misuse of powers that were, according to the law, permitted. They questioned whether the secretary of finance, as a member of the policy board, had objected to the chairman’s benefits or consulted the finance minister before attending the meeting.

Senator Mohsin Aziz emphasised that the matter required a thorough investigation, noting that some members of the SECP board had objected to the benefits, while others dissented or abstained from voting. He, however, cautioned against public discussions that could tarnish the reputations of these important institutions.

A written note from the Ministry of Finance explained that the SBP board set the remuneration and terms for the governor and deputy governors, as per Section 14A of the SBP law, with salaries deemed to be competitive with other professionals in the financial sector. It confirmed that a salary of Rs4 million for the SBP governor was approved by the board in October 2023, with other terms remaining unchanged.

Senator Faisal Sabzwari expressed support for investigating the misuse of powers but cautioned against undermining the reputation of the SBP and SECP in public. He suggested that the matter be discussed in detail with the Ministry of Finance and SBP at the next meeting, possibly in-camera.

The committee also continued its discussions on “The Virtual Assets Bill, 2025,” identifying discrepancies and proposing amendments to ensure the bill provides a level playing field. The government agreed to revise the draft as suggested by the committee.

Published in Dawn, September 11th, 2025