ISLAMABAD: In a rare move, Prime Minister Shahid Khaqan Abbasi has approved a special parting gift, equivalent of three-month salaries, for employees of the federal government at public expense.

The special ‘honorarium’ is estimated to cost Rs25-30 billion, provided it remains limited to federal government employees. The amount could rise up to Rs75bn if the special benefit is later extended to armed forces personnel, an official explained.

Responding to a question, he disagreed that the move could be termed pre-poll rigging, and elaborated that the elections would be held under a caretaker government through judicial officers, so federal government employees had no reason to be partial to the Pakistan Muslim League-Nawaz (PML-N).

The notification issued by the prime minister’s office did not mention employees of the armed forces. It said that the prime minister, who is also chairperson of the Economic Coordination Committee (ECC) of the cabinet, was “pleased to order that all employees of the federal government shall be given honorarium equivalent to three basic pays for financial year 2017-18. No exception shall be allowed for payment in excess of the ceiling in any case”.

Honorarium is estimated to cost exchequer Rs25-30 billion

The prime minister decided to set a precedent for future governments to allow such amounts to be doled out from the public kitty, but expressed hope that it would be based on some principles. He further “desired that for the financial year 2018-19 onwards a policy may be formulated by the new elected government after Elections 2018”, said a notification issued by PM’s Secretary Fawad Hasan Fawad.

This is the first time such a major decision has been taken by a prime minister, ever since the Supreme Court of Pakistan, two years ago, restricted the powers of the prime minister and members of the cabinet in financial matters, unless collectively approved by the federal cabinet.

A senior government official said personnel of the armed forces, and employees of provincial governments, public sector organisations and financial institutions would also harbour expectation of the financial benefit allowed to federal government employees. The combined financial impact on federal and provincial governments could go well beyond Rs150bn in that case, he warned.

The prime minister’s move comes at a time when the fiscal deficit has already been estimated by the Ministry of Finance to exceed 5.5 per cent of the GDP for the current fiscal year, compared to 4.1pc set in the budget last year.

Federal Minister for Finance Dr Miftah Ismail was not available for comment, but a senior government official said this was the first time a government had allowed a special financial benefit to all government employees without discrimination.

Published in Dawn, May 26th, 2018