In a decisive move to enforce austerity, the federal government has announced a “complete ban” on several types of expenditures, including the purchase of new vehicles and state-funded medical treatments abroad.
This directive, issued by the Finance Division this week, is part of broader efforts to reduce public spending amidst growing criticism over the tough federal budget and rising energy costs.
The government has been under fire for its efforts to secure a $7 billion economic bailout from the International Monetary Fund (IMF) without implementing proportional cuts in public sector spending. In response, the new measures are designed to ease the strain on the national treasury by curbing non-essential expenses.
The notification dated September 4 outlines a series of restrictions, notably banning the purchase of all types of vehicles, with specific exceptions for operational vehicles such as ambulances, firefighting vehicles, buses, and vans for educational institutions, solid waste management vehicles, and motorbikes. Similarly, the procurement of machinery and equipment will be restricted, except for essential items required for hospitals, laboratories, schools, and sectors like agriculture and mining.
Further, the government has prohibited the creation of new governmental posts, including temporary positions, and will abolish any posts that have been vacant for more than three years. In an effort to reduce costs further, medical treatments abroad using government funds will no longer be permitted, and “non-obligatory visits abroad where GoP funding is involved” are also banned.
“All Ministries and Divisions are instructed to ensure strict compliance with these directives across all departments under their administrative control,” the notification stated.
Last month, the government began phasing out regulatory bodies for devolved subjects such as health and education, eliminating transport facilities for federal ministries, and merging the aviation and maritime divisions with the defence ministry as part of its restructuring and austerity initiatives. These steps are aimed at streamlining operations and reducing redundant expenditures.
A senior government official noted that the prime minister will formally announce the final phase of these austerity and restructuring measures, following cabinet approval. He hinted that regulatory councils related to subjects devolved under the 18th Amendment may no longer operate at the federal level.
As part of the ongoing austerity drive, there will also be a freeze on recruitment of support staff (grade 1-16) across the federal government, with plans to gradually eliminate these positions as they become vacant. The officer cadre is expected to adopt artificial intelligence and digital tools to reduce reliance on support staff.
These federal measures follow similar steps taken by provincial governments. For instance, Khyber Pakhtunkhwa implemented a ban on the creation of new posts, vehicle purchases, and foreign training programs in April, alongside restrictions on state-funded overseas medical treatment.
Meanwhile, a recent decision by the Sindh government to approve the procurement of 138 luxury double-cabin vehicles for assistant commissioners across the province has sparked controversy. Defending the move, the Sindh government argued that assistant commissioners are “the backbone of provincial administration,” justifying the Rs2 billion allocation for these vehicles.
