World Bank report says Pakistan’s budget has lost credibility
ISLAMABAD: According to a draft report by the World Bank, Pakistan’s budget has lost its credibility and the public finance management has further weakened, it was revealed on Friday.
The international money lender shared the final draft of the Public Expenditure and Financial Accountability (PEFA) report with the finance ministry in June. The report assesses Pakistan’s public finance management system and an analysis of its annual budgets from 2015 to 2018.
According to a report in the Express Tribune, the World Bank was pressurised by the ministry of finance to soften the report but the international money lender refused to do so. The report contains findings that reflect the poor performance of the finance ministry and how it had failed to uphold fiscal rules.
The international money lender had conducted a similar assessment of Pakistan’s budget in 2012 where Islamabad fared poorly on almost all economic indicators. The score improved on only two indicators whereas on the other two, the score remained the same.
Pakistan lost out on the A score–the highest indicator–on key areas such as classification of budget, comprehensiveness of budget information, transparency in inter-governmental fiscal operations, participation in budget process and predictability of direct budget support.
Compared to that, in 2013 the country scored only six Ds. However, the figure changed into a disappointing 13 in 2019. D plus and D are the lowest scores used to judge the indicators.
The issues mentioned in the report were not even rectified by the PTI government in the annual budget 2018-2019, which was the first year of the PTI in power.
The report suggested the government make the office of the Auditor General of Pakistan independent from the executive so that expenditures can be properly accounted for.
The report cited that the government did not have an effective cash management system and that at the end of 2017, Rs2.3 trillion had been parked in 450,000 accounts, maintained in private commercial banks which could not be audited.