Unbudgeted expenses are not being met with additional grant funds, as a new allocation strategy has been announced by FD, focusing on re-appropriation instead.
In Pakistan, the process for requesting a Technical Supplementary Grant (TSG) involves a meticulous examination and approval by various wings of the Finance Division. Principal Accounting Officers (PAOs) play a key role in initiating and certifying these requests.
When authorized expenditure for a financial year is insufficient or new unbudgeted expenditure is needed, PAOs or Heads of Departments must submit requests, following a defined process under Article 84 of the Constitution and Section 10 of the PFM Act 2019.
The process begins with the PAO certifying that all alternatives like re-appropriation of funds have been exhausted and providing a valid justification for the requested TSG. This certification is verified by the relevant Accounting Organization/Office.
Next, the Expenditure Wing of the Finance Division examines the TSG cases in detail and submits recommendations to the Budget Wing. Cases related to the Public Sector Development Programme (PSDP) are processed via the Planning, Development and Special Initiatives Division.
The Budget Wing then evaluates these recommendations, considers fiscal space availability, and reviews budget execution reports from the SAP system. After careful consideration, they submit the case to the Finance Secretary for approval.
Upon federal cabinet approval of the TSG, the PAO submits related documentation including schedules endorsed by the Expenditure Wing, summary decisions by the Economic Coordination Committee (ECC), Cabinet ratifications, and surrender orders to the Budget Wing for entry into the SAP system.
Finally, funds approved through TSG are then released by the Finance Division in line with the Release Strategy and fund availability.
Supplementary Grants beyond the approved budget are generally not entertained except in severe natural disasters, and the same procedures apply for requesting such grants, involving PAOs certifying all avenues have been exhausted and providing strong justifications.
Thus, PAOs have a crucial role in certifying requests, providing documentation, and coordinating with Finance Division wings to process and manage the flow of TSG funds effectively within Pakistan’s financial governance framework.
[1] Finance Division Notification [2] Financial Management and Powers of PAOs Regulations, 2021
- In the event that unbudgeted expenditure arises or the approved budget is insufficient for a financial year, the Principal Accounting Officers (PAOs) must follow the process outlined in the Financial Management and Powers of PAOs Regulations, 2021, to request index funds through a Technical Supplementary Grant (TSG).
- The Finance Division oversees the release of funds approved through a TSG, which is crucial for the smooth operation of various business sectors in Pakistan, following the guidelines set forth in the Finance Division Notification.
