Assembly_Committee_Report_Presentation.pptx

report on Gilgit-Baltistan Finance act 2025

1. Briefing on Assembly Committee Report & Finance Act 2025 Prepared by: Finance Department, Gilgit-Baltistan Date: October 2025

2. Background • Committee constituted by Hon. Chief Minister GB vide Notification No. SO(I&C)-3(1)/2025 dated 30th July, 2025. • Terms of Reference (TORs): 1. Incentive, Secretariat, and Utility Allowances for GB Assembly Secretariat. 2. Legislative Allowance for Legal Advisory Service. 3. Enhancement of Daily Allowance for Police Personnel.

3. TOR 1: Incentive, Secretariat, and Utility Allowances • Incentive Allowance @150% and Secretariat Allowance @75% approved effective 1st July 2025. • Retrospective insertion in Finance Act 2025 violates Article 71(3) of GB Order 2018. • Finance Act cannot legalize expenditures of previous FY without saving clause. • The matter is sub judice in court.

4. TOR 2: Legislative Allowance for Legal Advisory Service • Approval subject to withdrawal of DRA (15%, 25%, 30%) and Non-Practicing Allowance. • As per M/o Finance OMs (2021, 2022), DRA not admissible if allowances exceed 100% of basic pay. • Article 118 of GB Order, 2018: Federal laws prevail in case of conflict.

5. TOR 3: Enhancement of Daily Allowance for Police • Finance Dept differs with Committee view; proposal not part of approved budget. • GB Police already drawing higher gross pay compared to other provinces. • Under Section 23(C) of Finance Act 2025, expenditure to be met from deficit or supplementary grant. • Requires additional Federal support or non-tax revenue.

6. Financial Position (ERE, Grants & Revenue) • BE 2024-25: Rs. 47.0 bn → RE: Rs. 52.55 bn (Difference: Rs. 5.55 bn) • BE 2025-26: Rs. 59.6 bn (Increase due to allowances & commitments) • Grants & Subsidies 2025-26: Rs. 11.411 bn allocated, Rs. 3.98 bn utilized. • Revenue Target 2025-26: Rs. 7.892 bn vs historical achievement below 65%.

7. Finance Department Clarifications • Committee discussions beyond TORs (House Hiring not relevant). • GB Government empowered under Section 23 of Finance Act 2025 to approve allowances within budget. • Salary disparities acknowledged; decisions must follow fiscal prudence.

8. Recommendations 1. Take up case with Federal Finance Division for Rs. 802.081 million funds. 2. Alternatively, re-appropriate Rs. 802.081 million from Development to Non-Development. 3. Utilize Rs. 906.863 million available for liabilities. 4. Consider mini/supplementary budget through Assembly.

9. Conclusion • Finance Department upholds legal and fiscal discipline in all decisions. • Any allowance revisions must align with GB Order 2018 and Finance Act 2025. • Fiscal sustainability and transparency remain top priorities.