Pakistan Prime Minister Shehbaz Sharif and his cabinet ministers to forgo salaries

Pakistan Prime Minister Shehbaz Sharif and his cabinet ministers on Wednesday unanimously decided to forego their salaries and related benefits because of the precarious economic condition of the country.

The decision was taken during a cabinet meeting as part of the government’s austerity policies aimed at curbing unnecessary expenditures, according to a press release by the Prime Minister’s Office.

The cabinet has already introduced measures restricting foreign trips funded by the government, ordering federal ministers, parliamentarians and government officials not to go on foreign trips by using government funds without prior approval. The measures are focused on promoting fiscal responsibility and optimising governmental resources in the face of economic challenges.

Last week, President Asif Ali Zardari and interior minister Mohsin Naqvi decided
to forego their salaries
while in office citing similar reasons.

Former President Arif Alvi was drawing Pakistan Rs 8,46,550 per month, which was fixed by parliament in 2018. Zardari is one of the richest politicians in Pakistan.

When Sharif was the Prime Minister in his earlier term, a similar measure was announced in February 2023.

However, these measures are commonly considered cosmetic to show that the government was sharing the burden of the people badly hit by grinding inflation.

In reality, the President, the Prime Minister and most of the ministers belong to the privileged, rich class and are not dependent on their salaries.

IMF agreement

The IMF on Wednesday said it has reached a staff-level agreement with the government on the final review of a $3 billion bailout, paving the way for the release of the last $1.1 billion tranche from the global lender.

The agreement, however, is subject to the approval of the executive board of the IMF to be held in April.

Pakistan’s new finance minister Muhammad Aurangzeb, who took over last week, had said that his priority was to start negotiations with the Washington-based IMF to bail out the country.

Last year, the IMF executive board approved the $3 billion Stand-By Arrangement for Pakistan, the term for which is set to expire in April. So far, two tranches have been issued while the last one is pending the review of the conditions set by the lender.

Led by IMF’s mission chief to Pakistan, Nathan Porter, the team visited Islamabad from March 14 to 19 and discussed the Second Review of Pakistan’s economic programme with senior officials.

“The IMF team has reached a staff-level agreement with the Pakistani authorities on the second and a final review of Pakistan’s stabilisation programme supported by the IMF’s $3 billion SBA,” the IMF said.