New updated Public Financial Management Rules.pptx

Public Financial management
How to manage public finance in Pakistan

1. Finance: Finance is the art and Science of Managing Money

2. Finance and its Basic Types

3. Public Finance Branch of Economics deal with income and Expenditure of the Government. Allocation of Resources. Distribution of Income Macro Economic Stabilization

4. Source of Govt. Revenues Taxes Direct Taxes Income tax Property tax Indirect Taxes Sales Tax VAT POS etc. Fees, Fines, Borrowings, FDI (Foreign Direct Investments)

5. Govt. Expenditures National Defense, Social Security, Healthcare, Interest Payments

6. RECEIPTS PAYMENTS NBP SBP Prepayment Audit Assignment Accounts Personal Ledger Accounts Special Drawings Account Advise to SBP Government Receipts and Payments

7. Payment out of Public Money Pre Audit Certification Senior Auditor AAO AO Authorization Assignment Accounts ( For Urgent Payments ) Special Drawings Account

8. Exchange Account Settlement Account Same Govt. Accounts Different Governments. Types of Accounts

9. Charged Expenditure Voted Expenditures Can be discussed but cannot be voted. Chief Election Commissioner Supreme court judges Chief Justice Through vote of Assemblies. Types of Expenditures

10. Charged Voted Emoluments and allowances of President and his office Salaries and allowances of Chairman/Deputy Chairman, Speaker/Deputy Speaker Interest payment Salaries , allowances and pensions of Judges of Supreme Court Pensions payable to Judges of High Court Administrative expenses of the office of AGP, includingsalaries,Allowances and pension payable to AGP Medical Health Education etc Voted Vs. Charged Expenditures

11. National Finance Commission The National Finance Commission (NFC) award is meant to distribute financial resources between the Federal Government and the Provinces.

12. Historical Background After the promulgation of the Government of India Act 1935, which introduced provincial autonomy in colonial India, then British Government amended first financial award, called Niemeyer Award 1936, afterward the Raisman Program known as Raisman award was succession of ongoing programs of economic refrorms in Pakistan, announced by the Prime Minister Liaqat Ali Khan, the then secretary finance Sir Jeremy Raisman was appointed to prepare the mechanism for the distribution of tax revenue. Later, the award was renamed as National Finance Commission Award.

13. The NFC Award includes the distribution of taxes collected by the Federal Government which form are _________ two, this pole includes taxes on income including corporate tax, sales tax and export duties. Pakistan has historical _____ a highly centralized federation and the Federal Government has massive powers to collect tax revenue, which then is distributed among the provinces. It determines the tax basis, “who should be taxed” the procedure of tax as well as the tax collection mechanism.

14. Legal Framework of NFC According to Article 160 of constitution 1973, after every five years, the president will constitute the NFC for a period of five years. Once there is consequence of all stock holders on a particular formula to distribute the finances, the award will be implemented.

15. NFC indicators after 2010 I. Population 82% II. Poverty and Backwardness 10.3% . Revenue Collection and Generation 5% IV. Inverse population diversity 2.7%

16. Share of Provincial Governments The sum assigned to the provincial governments is distributed amongst the provinces on the basis of percentage specified against each: a . Balochistan - 9.09 % b . Khyber Paktunkhwa - 14.62 % c . Punjab - 51.74 % d . Sindh - 24.55 %