30 percent increase in govt workers’ salaries

[BATMAN]

30 percent increase in govt workers’ salaries in new budget

http://www.thepost.com.pk/MainNewsT.aspx?bdtl_id=5792&fb_id=2&catid=14

Rs 1.57 trillion budget to be presented on June 9

Sajid Gondal

ISLAMABAD: The federal cabinet would approve a Rs 1.57 trillion budget for the fiscal year 2007-08 on June 9. The budget will be presented in the Parliament the same day.

The quantum of the coming budget in FY-2007-08 is being increased by 20 percent, but the total outlay would remain below Rs 1.6 trillion, officials said, adding it was wrong that the total size of the budget was being raised to above two trillion rupees. Sources said that June 9 was being discussed for the announcement of the new federal budget which will be presented by Minister of State for Economic Affairs Division Omer Ayub Khan in the National Assembly.

Finance Division sources said that the prime minister had given special directives to the Finance Division to prepare a relief package for government employees and industrialists to win the hearts of all strata of society in the election year.

The new budget will focus on infrastructure development, especially the construction of roads and highways, thus 25 percent increase is expected in allocation for development programmes. A senior official told The Post that major developments in the upcoming budget included a 15 percent increase in the Public Sector Development Programme besides a two percent increase in the education and health allocations.

The Annual Plan Coordination Committee will meet Monday to recommend Rs 500 billion outlay of the PSDP including the provincial share to the National Economic Council (NEC) for approval. The PSDP allocation will be about 15 percent more than the last year's allocation of Rs 420n billion. "There will be up to 30 percent increase in the salaries and pension of government employees according to various wage scales of employees and a special tariff cut will be announced for the power sector and textile and automobile industries," the official said.

He added that the increase in salaries would be made keeping in view the rate of inflation in the country. The inflation in the country is estimated at over 8 percent during the first half July-December period of the current fiscal year as against the target to limit it to 6.5 percent during the whole financial year of 2006-07.

The official also claimed that in 2007-08 the budget deficit would be contained to four percent of the Gross Domestic Product, lower than the current target of 4.2 percent budget deficit for 2006-07.

"According to the Fiscal Responsibility Law, the federal government is supposed to maintain its budgetary deficit at four percent of the GDP in the coming financial year," the sources added. They dispelled the impression that the budgetary deficit in FY-2007-08 would be around seven percent.

The official said the budget would be free from the dictation of the International Monetary Fund. "As Pakistan is not getting loans from the IMF, the fund would not put any pressure on the government for incorporating its conditions and targets in the new budget." The sources said the Central Board of Revenue had proposed one trillion rupees target of tax revenue collection in 2007-08 during the recent budgetary meetings. "CBR Chairman Muhammad Abdullah Yusuf has pointed out in a recent budgetary meeting that actual tax collection in the new financial year could exceed one trillion rupees, but he proposed the fixation of target at one trillion rupees against the target of Rs 835 billion collection in this financial year," the sources added.

 

[Bull]

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