ISLAMABAD (HRNW): In a move that has sparked concern among government employees just days before Eid-ul-Fitr, the Federal Government has suspended the payment of all non-salary allowances and benefits. Following special directives to curb public spending, the Accountant General Pakistan Revenues (AGPR) has halted all disbursements except for basic salaries and pensions. This temporary suspension is part of a broader fiscal consolidation strategy aimed at meeting the benchmarks set during ongoing negotiations with the International Monetary Fund (IMF) and ensuring national economic stability.
Austerity Measures and Financial Cuts
The suspension of allowances follows a series of stringent austerity measures approved by Prime Minister Shehbaz Sharif. To address the economic impact of the global fuel crisis and rising inflation, the government has implemented the following:
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Salary Reductions: A 5% to 30% cut in the salaries of employees in state-owned enterprises (SOEs) and autonomous institutions.
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Cabinet Contribution: Federal ministers, advisers, and special assistants will contribute their next two months’ salaries to public welfare funds.
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Operational Restrictions: A 50% reduction in fuel quotas for official vehicles, the grounding of 60% of the government’s vehicle fleet, and a complete ban on the purchase of new vehicles and foreign trips for officials.
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Digital Shift: A preference for online meetings and teleconferencing to minimize administrative expenses.
While the government has ordered the early release of basic salaries and pensions to provide relief for Eid festivities, the freeze on additional allowances remains a significant component of the “fiscal discipline” policy. Authorities have emphasized that these steps are necessary to redirect funds toward public relief and maintain economic sovereignty during a period of high global energy volatility.
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