ISLAMABAD: The Ministry of Finance is racing to assemble a broad reform agenda for presentation to the International Monetary Fund next month, with senior officials describing the effort as an attempt to finally seal long running gaps in Pakistan’s public financial management.
The proposals, which total fifteen, are being refined after extensive consultations with an IMF technical team that has pushed for a tighter and more transparent budget system.
Officials say the centrepiece of the plan is a full shift to digital tools for budget execution. The government is weighing the creation of a dedicated body to supervise the conversion of the Public Finance Management system into a fully automated platform.
The approach includes preparing annual budgets through e office systems and electronic tablets, compiling data through integrated digital channels and coordinating more closely with line ministries to limit the scattershot process that has shaped budgets for years.
Sources familiar with the ongoing talks said the IMF has also revisited tax policy for the next fiscal year. The Fund has been urging Pakistan to adjust revenue measures that have long been shielded from deep reform, arguing that without changes to tax structures the country will continue to face chronic shortfalls.
The Ministry of Finance argues that the drive to digitise is intended to narrow discretion, strengthen fiscal controls and prevent manipulation within the system. Pressure to move quickly increased after the IMF made public its Governance and Corruption Diagnostic Report last week.
The document, released through the ministry on November 19, warned of significant risks of illicit financial activity, highlighting vulnerabilities in banking, real estate, construction, procurement and transactions involving politically exposed individuals.
The report called for an immediate rollout of a fifteen point reform blueprint to boost institutional integrity. It also criticised amendments adopted by the federal and Punjab governments that permit contracts to be awarded to state bodies without open competition, a practice the IMF says has encouraged opaque subcontracting that benefits private intermediaries.
The Fund has asked Pakistan to end preferential treatment for state owned enterprises within a year, warning that exemptions distort markets and heighten corruption hazards.
Officials say the next few weeks will test whether Islamabad can convert plans into binding commitments. The IMF is expected to monitor each step before deciding how to move forward with Pakistan’s programme.
