- Government must clarify
Apart from setting a record high tax collection target another focus in the first federal budget tabled by the PTI is austerity; a combination of reducing expenditures and increasing revenue is the plan to get the country back on its feet. One of the most notable contributions to this belt-tightening was the Armed Forces taking a voluntary cut in their allocated expenditure by refusing the routine increase in the defence budget. Considering the economic condition of the country it was a reasonable decision that would not only support the government in its efforts to plug the revenue-expenditure gap but also in terms of optics, displaying that every institution was doing its part. However, the Finance Ministry has now informed parliament that a total of Rs222 billion were spent by the government without parliamentary approval of which Rs36 billion was spent by the army making it the recipient of the largest supplementary grant last year. In addition to this the documents also reveal that apart from an increase of 1.4pc over the revised defence budget figure (Rs1.138tr to Rs1.152tr) a separate ‘development expenditure’ for the defence division of Rs370.5bn for the upcoming fiscal year translates into a combined increase of 21.5pc in defence spending over last year.
A discrepancy of this magnitude requires explanation on part of the government. If there is misreporting of figures now, it is the government’s responsibility to provide an acceptable clarification. If in fact the budget cuts were initially part of the plan and there was a revision later then it again falls upon the government to explain why such a reversal was necessary. PM Khan himself through his twitter account lauded the proposed expenditure cuts in the defence budget and promised that the funds would be spent on development in Balochistan and FATA. Details that are now being reported suggest otherwise. Given the regional threats that the country faces, especially the recent escalation with India, any proposed increase in the army’s budget can be justified. But it would be best that some rationale is presented by the Finance Ministry in relation to these updated budget allocations otherwise an unnecessary controversy will unfold very quickly.