The government had presented current fiscal year budget on May 26, 2017, two days before the advent of Ramazan. Talking to media persons, Minister of State for Finance Rana Muhammad Afzal stated that next fiscal year''s budget should be presented by the incumbent government, which will be its sixth budget.
Sources said that work on budget for the next fiscal year is under way in the Finance Ministry after the issuance of budget circular to all the ministries and divisions. In the budget circular, a tentative date for presentation of budget to the federal cabinet and Parliament is May 2018. Sources further stated that there are clear indications that the present government wants to present the budget before the start of Ramazan.
As per budget circular, ministries and divisions have been asked to submit indicative budget ceilings for current expenditure and development expenditure by the second week of February. Priorities Committee''s meeting will review budget of ministries and divisions in the first week of April.
The Annual Planning Coordination Committee (APCC) meeting to consider and approve development outlay and review the macroeconomic indicators for the current fiscal year and propose the targets for the next fiscal year is scheduled for mid-April 2018. The APCC meeting will be co-chaired by the ministers for planning and development and minister for finance while the meeting will be attended by the provincial ministers for finance and planning and development.
The Prime Minister will chair the National Economic Council (NEC) meeting in the last week of April 2018 to approve the development outlay and macroeconomic indicators for the next fiscal year. The NEC meeting is attended by the chief ministers and finance ministers of the provinces, prime minister of AJK, chief minister GB as well as governor Khyber Pakhtunkhwa who represents Federally Administered Tribal Areas (FATA).
Sources stated that ministries and divisions have been asked to provide details of current and development expenditures utilization in the first six months with utilization estimates for the next fiscal year. They added that on the basis of the utilization of the current expenditure, Finance Division prepares estimates, revenue and expenditure, for the next fiscal year with the addition of inflationary component.
However, they added that as the budget for the next fiscal year is expected to be announced one-and-a-half months before the end of fiscal year, the slippage in terms of revenue collection and expenditure will be greater as compared to last fiscal year''s. The revenue collection of Federal Board of Revenue (FBR) was budgeted at Rs 3,621 billion for 2016-17, but it was revised downwards to Rs 3,521 billion at the time of budget 2017-18 preparation. However, the actual collection was Rs 3,361 billion which was Rs 260 billion lower than the budgeted amount and Rs 160 billion from the revised projection.
The current expenditure was budgeted at Rs 3,843 billion in the budget 2016-17 but was revised upward to Rs 3,904 billion at the time of budget 2017-18 preparation.
Sources on condition of anonymity stated that fiscal deficit will be a major concern for the Finance Ministry in the last fiscal year of the present government due to excessive spending by the federal and provincial governments in an election year. Provinces are unlikely to generate an estimated budget surplus of Rs 347 billion rather the provincial budgets may run into deficit due to over spending in development budget.