Govt likely to slash PSDP by Rs150-200bn

September 27, 2023 (MLN): The caretaker government is likely to reduce the Public Sector Development Programme (PSDP) by Rs150 billion to Rs200bn for the current fiscal year.

Dr. Shamshad Akhtar, the caretaker finance minister, emphasized that there is significant potential to optimize the allocation and expenditure of public funds by both the federal and provincial governments.

A meeting was held at the finance division today with the aim of reviewing the spending patterns of PSDP, controlling prices of essential commodities, enhancing quality of services in education and health sectors and providing relief to the general public by strengthening the social safety nets.

During the meeting, the finance minister urged that the provinces are the interface with the public and have a major role to play in improving the social services as well as ensuring food security and stabilizing prices by minimizing the gap between the whole-sale & retail prices of the essential commodities.

She added that policy and fiscal coordination between the federal and provincial governments is pivotal for the economic prosperity and sustainable growth.

Optimizing public expenditure is essential to enhance the efficiency and effectiveness of government spending.  

She underlined that the corrective measures in this regard would not only result in substantive savings but would also contribute in improving the effectiveness and implementation of the project in the priority sectors of education and health.

While sensitizing the provincial finance Ministers regarding the expenditure and revenue targets in the current budget of the FY2023-24, Dr. Akhtar encouraged the provincial governments to ensure achieving these targets, so that the primary budget deficit targets can be achieved.

The meeting recommended provinces to bring forward prioritization of various projects funded by the Federal Government which falls under the ambit of the provincial subjects following the devolution of power.

The provinces assured that efforts are underway to control prices and improve quality of service in health and education sectors and to streamline financial discipline to meet budgetary targets.

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