Senators protest pay differences and issue a province tax warning

On Friday, senators harshly criticized the enormous difference in benefits and compensation between employees and government employees. There were worries that the provinces might start collecting taxes on their own if this pattern persisted and was combined with excessive government spending.

Politicians from a variety of parties discussed the pay packages for MP-I, MP-II, and MP-III officers, the senior officers of the State Bank of Pakistan, and the pensions that are given to retired civil and military personnel who are now living overseas in dollars. When it comes to money and foreign exchange, the entire nation is experiencing economic difficulties.

During the question hour, the Senate floor was used to examine the SBP officials’ compensation packages, keeping the topic of discussion front and center in the chamber. Additionally, Mian Raza Rabbani, the former Senate chairman, initiated a calling attention notice.

Citing a recent Ministry of Finance notification, Rabbani conveyed his regret that, while government spending and elite salaries are rising without transparency, electricity and gas tariffs are regularly raised at the International Monetary Fund’s (IMF) request.

He cited criticism of financial mismanagement by the parliament, arguing that the real culprit is the civil bureaucracy. Rabbani questioned why pensions in dollars were being paid to 164 retired military and civilian officers who were living overseas.

The experienced PPP senator refuted allegations that the provinces, the NFC, and the 18th Amendment are to blame for the depletion of money. He issued a warning, saying that provinces—especially the smaller ones—may seek to collect all taxes and send the money back to the federation if federal government spending and bureaucrat salaries are not reined in.

In his comparison between laborers and government employees, Rabbani pointed out that the minimum salary for unskilled laborers is Rs32,000, with an increase of Rs7,000. The starting Basic Pay for BPS-1 to BPS-5 is an average of Rs14,390; for BPS-5 to BPS-15, it is an average of Rs22,840; and for senators, it is Rs15,000.

On the other hand, he emphasized the recent increases in base pay, utilities, and housing rent that the caretaker prime minister authorized for MP-I, II, and III officers. He expressed concerns about the growing gap and provided details on the updated monthly packages for each scale.

Rabbani criticized the blame on the NFC and the 18th Amendment and questioned the extravagant spending. He said that the federal government continued to siphon off Rs. 200 billion from the provinces’ share even after devolution.

Interim Finance Minister Shamshad clarified that the MP scale was implemented in order to attract experts from the commercial sector to the public sector in response to his call attention notice. She added that the scale was created to modernize the system and acknowledged the technical challenges faced by the energy and finance industries.

The significant pay packages were criticized by Senators Danesh Kumar, Palwasha Behram, and Mushtaq Ahmad. They specifically questioned the performance of the senior SBP personnel and questioned why they were earning packages worth up to Rs4 million a month. According to Senator Mushtaq Ahmed, the government’s mansions and offices in Islamabad receive free electricity valued at Rs. 10 billion a year.

It was revealed during question period that workers at the central bank, particularly those at higher grades, were receiving monthly salaries that were more than a member of parliament’s two-year salary. Lawmakers questioned the disclosure’s impact on the national exchequer and their performance, which received harsh criticism.

According to acting finance minister Shamshad Akhtar, wages for SBP personnel at the highest grade, OG-8, ranged from Rs1.7 million to Rs3.9 million per month. She maintained that several governments had changed the pay structure throughout time to reflect their respective roles in controlling the banking industry and setting monetary policy.

The Chief Justice-Prime Minister’s Dam Fund held Rs11.46 billion as of July 2023, the finance minister informed the house in a written response. She pointed out that the government has earned Rs6.29 billion in profit from this fund, making its current value of Rs17.86 billion.

She explained that no money had been taken out of the dam fund and that such payments could only be made in response to rulings from the courts.

In answer to a different query, the house was told that Rs8.40 billion was spent in the fiscal year 2021–22 on utility bill payments for different ministries, departments, divisions, and other organizations that fall within the administrative purview of the federal government. In the fiscal year 2022–2023 the spending went up to Rs10.16 billion.

The minister informed Senator Mushtaq that all government departments were included in this total sum. She acknowledged his suggestion to cut costs and promised to give the key account officers instructions to do so.

The minister emphasized that the individual Principal Accounting Officer bears the responsibility of guaranteeing that the funds designated for utility bill payments are utilized only for their intended purpose