Principal Accounting Officers Ordered to Strictly Follow the Public Finance Management Act

The Finance Division has warned Principal Accounting Officers to ensure that no expenditure (employees related or others) is incurred without the available budget and conduct business in accordance with provisions of the Public Finance Management Act, 2019 and General Financial Rules in true spirit.

Finance Division (Budget Wing) has issued an office memorandum to all finance secretaries, additional finance secretaries and PAOs of Ministries/Divisions.

According to the Finance Division, refer to the Public Finance Management Act, 2019, it is to state that PFM Act has been enacted to strengthen the management of public finances in the Federal Government. It clarifies institutional responsibilities related to financial management and strengthen budgetary management. Section 10 relates to changes in the schedule of authorized expenditure while Sections 23 and 25 of the Act also elaborate expenditure out of the budget grants.

As per definition under section 2(q) of PFM Act, “Principal Accounting Officer is responsible for exercising financial propriety in management of public funds and having accountability to Parliament for the economic, efficient and effective use of resources”. Under GFR 88 “The authority administering a grant is ultimately responsible for watching the progress of expenditure on public service under its control and for keeping the expenditure within the grant.”

In the light of the above-mentioned law and rules, Principal Accounting Officer is responsible to administer the demand and firstly charge the allocated budget for ‘A01-employees’ related expenses against the sanctioned posts and to ensure that no shortfall has occurred in the relevant head. If there is any shortfall the funds may be provided through re-appropriation or technical supplementary grants for the purpose. The PAOs will be responsible in case of any excess payment over the allocated budget and will also be answerable before the PAC in this regard.

All PAOs are requested to transit business in accordance with provisions of PFM Act and General Financial Rules in the true spirit, Finance Division stated.

Kindly ensure that no expenditure (employees related or others) is incurred without the available budget (as per section 23 quoted above), Finance Division added.

Source: Pro Pakistani