Pakistan’s Finance Minister Muhammad Aurangzeb announced bold reforms on Tuesday to reduce federal government expenses and improve efficiency. The government plans to halve the number of affiliated agencies and has already abolished 150,000 vacant jobs.
“We are reducing the federal government’s size step by step. So far, 80 departments have been merged into 40,” Aurangzeb said at a press conference. The restructuring initiative aims to complete these reforms by June 2025.
Key Highlights of the Reforms
- Job Cuts and Consolidation
- Around 60% of vacant government positions, totaling 150,000, have been eliminated.
- Departments are being merged; for instance, the Ministry of Kashmir Affairs and SAFRON are being combined, while the Capital Development Authority (CAD) is being abolished.
- Phased Implementation
- In the first phase, six ministries, including Kashmir Affairs, IT and Telecom, and National Health Services, were right-sized.
- In the second phase, 60 subordinate institutions across ministries like Science and Technology and Commerce are being reduced or merged.
- The third phase targets ministries like Education, Information, Power, and Finance.
- Economic Restructuring Focus
- The federal government aims to shift its focus towards export-driven growth, leveraging digitalisation and technology.
- Hospitals will be transferred to provincial administrations to streamline operations.
- Macro-Economic Stability
- The government has already abolished the traditional pension system and reduced current employee benefits to curb rising expenditures.
Aurangzeb emphasized that the restructuring is about more than cost-cutting. “This is about improving efficiency and ensuring the government functions better,” he stated.
The initiative aligns with Pakistan’s efforts to stabilize its economy, with signs of improvement in key indicators. A new technology program is expected to be inaugurated soon by Prime Minister Shehbaz Sharif to boost innovation.
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