Finance Division Extends Strict Austerity Measures

The Finance Division has extended the federal government's strict austerity measures for FY2026-27, continuing a range of expenditure controls aimed at strengthening fiscal discipline and limiting non-essential public spending.

 

Under the latest notification, ministries, divisions, state-owned enterprises (SOEs), statutory bodies, and regulatory authorities have been instructed to maintain restrictions introduced in previous years. These include a ban on the purchase of vehicles, procurement of machinery and equipment, and the creation of new posts.

 

The decision follows the federal cabinet's approval of the continuation of austerity measures adopted in 2023 and 2024 as part of the FY2026-27 budget framework. Ministries have been directed to ensure compliance across all subordinate departments and affiliated organisations.

 

For SOEs, the directives will be implemented under the State-Owned Enterprises (Governance and Operations) Act, 2023, while statutory organisations will be required to enforce them in accordance with their respective legal frameworks.

 

The Finance Division's Austerity Committee has been authorised to consider exemption requests on a case-by-case basis where sufficient justification exists. The government said the measures are intended to support ongoing fiscal consolidation by curbing unnecessary expenditure.