Federal Budget Call Circular 2021-22

Federal Budget Call Circular 2021-22

Finance Division, Government of Pakistan has announced the federal budget call circular 2021-22 through the publishing of notification on 9th January, 2021. You can find out through the circular about the announcement of Budget 2021-22 Pakistan date and presentation. The detail of the notification is given below;

Table of Content:

  1. Federal Budget Estimates 2021-22
  2. Budget Calendar 2021-22
  3. Current And Development Expenditures (Revenue & Capital)
  4. Budget Preparation in Pakistan 2021-22
  5. Budget Instructions 2021-22

Federal Budget Estimates 2021-22 Call Circular Details

Budget is a key policy document of Federal Government and it spells out plans, allocated resources and agencies responsible, for its execution. Being its core function. Finance Division has been accomplishing this important task under the provisions of the Constitution of Islamic Republic of Pakistan and Public Finance Management Act, ,2019. Accordingly, Budget Can Circular for Financial Year 2021-22 has been prepared in the fight of Public Finance Management Act, 2019 and Budget Manual 2020.

Budget Call Circular contains budget calendar and processes, instructions and forms for preparation and submission of detailed budget estimates i.e. Actual (FY 2019-20)1 Revised Estimates (FY 2020-21) and Budget Estimates (FY 2021-22) in respect of Federal Government Receipts and Current & Development Expenditure.

Read More: How Much Increase Salary in Budget 2021-22

The Indicative Budget Ceilings (IBCs) issued by Budget Wing, Finance Division in April, 2020, for Current and Development Budget for three years i.e. 2020-21,2021-22 and 2022-23, may be considered as base line for submission of /Budget Estimates.

Receipts. Current and Development expenditure estimates (Forms I – III) by respective PAO must be provided to this Division before 15th March, 2021. The remaining information may be provided as per schedule given in Budget Calendar.

Budget Call Circular 2021-22 has also been issued through e-mail and is available on the website of Finance Division (http://finance.gov.pk/downloads.html).

Budget Calendar 2021-22

The Budget Calendar presents activities and actions that are required to be finalized by the stakeholders to complete the budget making process for the financial year 2021-22. The budget calendar also specifies the timelines for each activity.

Federal Receipts:

S.No Activities Responsible Timeline (Last  date)
1. Revised Estimates (2020-21) and Budget Estimates (2020-21) of Federal Government Receipts (Form-I) PAOs 15th March 2021
2. Budget Proposal relating to Tax & Non-Tax Revenue for inclusion in Finance Bill 2021-22 PAOs 15th March 2021

Current And Development Expenditures (Revenue & Capital)

S.No Activities  Responsible  Timeline (Last date)
1. Submission of Current & Development Expenditure Budget Estimates (Form-II and Form-III) PAOs 15th March 2021
2. Development of Budget Strategy Paper Finance Division 2nd week of March 2021
3. Demand Review Committee’s meetings (is required) Finance Division 1st week of April 2021
4. Submission of Budget Strategy Paper to the Cabinet Finance Division 1st week of April 2021
5. Issuance of IBCs for current and development budget Finance Division 3rd week of April 2021
6. APCC & NEC meetings Planning Division & Finance Division April 2021
7. Submission of BO/NIS Forms for the current budget PAOs 26th  April to 14th May 2021
8. Submission of BO/NIS Forms by Ministries / Divisions for the development budget PAOs 10th to 21st May 2021
9. Completion of all Budget Documents, Schedules, and Summaries for the Cabinet, etc. Finance Division End of May 2021
10. Presentation of Budget to the Cabinet and the Parliament Finance Division 1st week of June 2021

Budget Preparation in Pakistan 2021-22

Legal framework on annual budget is available in Articles 78 to 84 of the Constitution. The Public Finance Management Act, 2019 provides legal cover to budge,ting and financial management. Finance Division has also issued various instructions time to time, which are available on Finance Division’s website.

This section sets out the process for the preparation of the Budget 2021-22. All Federal Ministries I Divisions will prepare their budget on Performance & Output Based Budgeting System. The following are details of steps involved in the budget preparation process as outlined in the ‘Budget Calendar.

1. Issuance of Budget Call Circular 2021·22 to the Principal Accounting Officers WACs,)

As a first step, the Finance Division will issue “Budget Call Circular” to the’ PADs. This is the circular that contains the instructions and forms required tlO be completed by the respective PAOs.

2. Submission of Budget. forecast by the Principal Accounting Officer

The Indicative Budget Ceilings issued by Finance Division in April 2020, for current and
development budget of three years i.e. 2020-21, 2021-22 and 2022-23 will be considered as base line for submission of Budget Estimates 2021-2022 under Form III. Moreover, PAD will submit estimates keeping in view Public Finance Management Act, 2019 and priorities of Federal Government.

3. Review and approval of budget estimates and additional demands (current + development) by the Demand Review Committee

If needed, Principal Accounting Officer (PAD) will be invited to make presentations on their budget proposals to the Demand Review Committee (comprising Finance Division, Planning, Development and Special Initiatives Division, and Economic Affairs Division). Demand Review Committee would consider and approve additional expenditure (if any) of the Ministries.

The Demand Review Committee will discuss past performance, current year’s budgetary
allocations and ceilings for the medium term budgetary years. Discussions/deliberations will focus on ‘outputs’ (services) to be delivered and policy priorities outlined by the Federal Government under the respective Performance Agreement.

4. Preparation of Budget Strategy Paper and its presentation In the Cabinet

Finance Division shall prepare Budget Strategy Paper and seek approval of the Federal
Government in accordance with the section 3 of the PFM Act 2019,

5. Issuance of Indicative Budget Ceilings for current and development budget to all PAOs,

Federal Ministries/Divisions will receive the confirmed indicative budget ceilings after approval of the Budget Strategy Paper by the Cabinet. The ceilings for current budget are prepared by Finance Division. One line ceiling for development budget is issued by Finance Division in favour of Planning Division. However, Project-wise/Demand-wise /PAO-wise ceilings for development budget are prepared and issued by the Planning, Development and Special Initiatives Division.

6. Filling of the BO/NIS Forms

The Ministries / Divisions / Departments will go through the instructions to fill in the BO/NIS Forms to be submitted to Finance Division as per identified timelines.

7. Submission of forms by Ministries

Divisions for current Budget and Development Budget In the presence of ceilings, the concerned CFAO will assure quality of BO/NIS forms and give their recommendations (if any) to the concerned Principal Accounting Officer.

Budget Instructions 2021-22

1. Each Demand for Grants and Appropriations may indicate budget estimates for ensuing year, initial budget estimates and revised estimates for outgoing year and actual of expenditure of the year prior to outgoing year

Actual 2019-20

2. Actual Expenditure for the FY 2019-20 for current and development expenditure must be submitted as per format available under BO/MS Form.

Revised Estimates 2020-21

3. Revised Estimates for the FY 2020-21 for current and development expenditure must
include, among other things, the following:

A. Appropriations or re-appropriations within the sanctioned grants;

B. New items of expenditure sanctioned through supplementary grants; and

C. Surrenders made or likely to be made during the year.

Budget Estimates 2021-22

4. The BO/NIS forms endorsed by the CFAO and respective PAO will be forwarded to the Budget Wing (Finance Division) for further necessary action.

5. Each Demand will have only one Principal Accounting Officer.

6. While preparing BOs, I NISs, the Principal Accounting Officers shall allocate budget provisions under relevant Cost Centres and Circle of Accounts {where the payment is actually required to be made}. AGPR has been instructed not to authorize payment where budget provision does not exist under relevant Head of Accounts including employees related expenditures. Instructions issued vide letter No. 1(3)CAO(MoF)/2020/447 dated 04.12.2020 may be adhered to.

7. Finance Division will issue one line budget to all PAOs and it is the mandate of the PAD to allocate funds in various cost centres and heads of accounts

8. It is responsibility of PAO to keep available adequate funds in all heads of accounts throughout the financial year. especially ERE to avoid any delay or non payment of salaries.

9. The Federal Budget relating to expenditure will be prepared at spending level (DDO level).

10. No lump-sum provision should be made or proposed to be made in the budget. All items under the object classification should be proposed according to the prescribed detailed object heads of accounts.

11. Organisations / entities that use single-line budget (other than subsidies) will provide detailed budget information (Le. on detailed object classification) along with details of their own receipts.

12. All Government expenditure, whether from recurrent or development demand for grant shall be based on well-defined plans.

13. To anticipate cash need of Government, a form titled ” Cash Plan”  may be filled keeping in view the expenditure trend of the respective Ministry/Div ion/Department.

14. All Ministries and Divisions, their attached departments and sub …ordinate offices and organizations shall surrender all anticipated savings in the grants or assignment accounts or grant-in-aid controlled by them to the Finance Division as per timeline issued vide letter No. F. No. 1(269) .Dir(BC)/2020-218 dated 04.02.2020. The Finance Division shall communicate the acceptance of such surrenders before close of the financial year.

15. All development projects shall be prepared in conformity with procedures, processes and templates defined by the Planning, Development and Special Initiatives Divisional.

16. Projects defined in public sector development programme shall be classified as sectoral projects undertaken by specific sectors. Ministries and Divisions which are required to enhance t.he development of that sector or Ministry or Division.

17. All development project proposals shall be subject to a. technical approval process. Technical approval’ shall only be granted to projects which are compliant with the standards and procedures set by the Planning, Development and Special Initiatives Division. Findings and recommendations contained in the independent quality assurance reports” cost and benefit analysis and risk assessment. where required as per Sub-Section (2) of Section 114 of PFM Act, 2019 shall be taken into account by these fora while considering the development project proposals.

18. Cost and benefit analysis and risk. assessment of all development project proposals, in [excess of a threshold size prescribed by the Planning, Development and Special Initiatives Division shall be undertaken.

19. Development project proposals which exceed in their total cost. thresholds defined by the Planning, Development and Special Initiatives Division shall) be subject to quality assurance. Such quality assurance shall be undertaken by an individual/body which is independent of the sector/Ministry/Division that has initiated! the preparation of the development project proposal.

20. No development project shall be considered for inclusion in demands for grants that does not carry technical approval. No development project shall be considered for inclusion in demands for grants unless a budget allocation is provided for the coming year which fully reflects the proposed project cost for each year.

21. Every Ministry and Division shall include in its demands for grants adequate, funds, dedicated for operation and maintenance of the physical infrastructure assets under its supervision.

22. Budget Manual 2020 and Public Finance Management Act, 2019 win govern the preparation and compilation of Federal Budget.. The same are available on Finance Division’s, website http://www.finance.gov.pk.

Federal Budget Call Circular 2021-22 Pdf Download

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