Extension of austerity measures announced for fiscal year 2025–2026
Following the Federal Cabinet’s June 10 approval, the Finance Division announced on Monday that austerity measures would continue for the fiscal year 2025–2026.
A total prohibition on the acquisition of any kind of vehicle, machinery, and equipment, as well as the establishment of new positions, are among the measures.
All federal government-affiliated departments, state-owned businesses, and statutory bodies, including regulatory agencies, will be subject to the austerity measures, according to the notification. The Cabinet Division and the Finance Division had already authorized and notified of these measures in previous fiscal years.
According to Section 35 of the State-Owned Enterprises (Governance and Operations) Act, 2023, the actions are regarded as federal directives for state-owned businesses. The pertinent clauses of each governing law will be applicable in the case of statutory bodies.
The following prohibitions will remain in place until further notice, per the Finance Division’s previous notification dated September 4, 2024: buying any kind of vehicle, with the exception of operational vehicles like ambulances, medically equipped vehicles, firefighting vehicles, buses and vans for educational institutions, solid waste vehicles, and motorcycles; buying machinery and equipment, with the exception of those required for hospitals, laboratories, agriculture, mining, and schools; creating new positions, including temporary or contingent paid positions; extending temporary or contingent paid posts for more than a year; receiving treatment overseas at government expense; and non-obligible foreign visits financed by the Pakistani government.
Additionally, the notification announced the elimination of all positions that had been unfilled for the previous three years. However, the prohibition does not apply to the creation of posts or the acquisition of durable goods as part of PSDP-funded projects.
The Finance Division affirmed that, absent a change or withdrawal by the Federal Cabinet, austerity measures previously announced by the Cabinet Division in formal memorandums dated February 28, 2023, will continue to be in effect during fiscal year 2025–2026.
