What undermines parliament’s role in budget

ISLAMABAD: Pakistan is one of a few countries in the world where money is spent first in shape of supplementary grants every year and then Parliament’s approval is sought at the end of the year.

Now the government has again sought approval of Rs310 billion by submitting it as supplementary grants before the Parliament. This process should be reversed altogether as prior approval of the Parliament should be made mandatory instead of seeking approval after spending money.

In our region, the practice of getting approval of supplementary grants after spending money continues in Pakistan and Bangladesh only which undermines the role of the elected House of Parliament to ensure proper scrutiny of each and every penny spent through budgetary process.   

“This process should be reversed as first the approval of the Parliament should be sought then money should be utilized,” one top official told The News here on Monday. The practice of the executive of spending without prior approval from Parliament has two important negative impacts: First, it undermines the basic principle of the Constitution that Parliament should have ultimate control and oversight over the federal budget. 

This control cannot be achieved if the Executive exercises freedom to change, remove or add to the areas of spending without prior Parliamentary approval.  In fact it makes a farce and a charade of the annual process of presentation of the budget by the Executive to Parliament. 

Second, the practice of introducing new projects during the budget year has completely undermined the planning process.  The Planning Commission was established to ensure that proper procedures are followed to plan the use of scarce public resources and rigorous project appraisal procedures. It is no exaggeration to say that the Federal planning processes have been destroyed by the breakdown of budgetary discipline and the constant within-year changes to the budget.

There is also need to discuss legality of the budget as according to the 1973 Constitution, it is the prerogative of parliament to approve the annual budget. In practice the budget approved by Parliament in June each year has little bearing on the way public monies are actually spent by the Executive, at least with regard to the “voted” component of the budget.  This is because of the extremely widespread use of supplementary appropriations by the Executive during the budget year, without seeking prior approval of Parliament.

The Executive argues that Article 84 of the Constitution empowers them to make such changes on the use of funds (re-appropriations from one area of expenditure to another, and supplementary appropriations which involve allocating funds to areas of expenditure not provided for in the budget (e.g. new projects introduced during the budget year) without seeking prior approval from Parliament. It should be emphasized that this way of managing the budget is quite out of line with internationally accepted standards of budgetary management. Only a very small number of countries in the world allow their Executive Branch to spend money without prior approval from the Parliament.

There has been a lot of discussion and disagreement about the appropriate interpretation of Article 84 of the Constitution which relates to supplementary appropriation. Finally, in the situation where the approved budget is disregarded and subject to radical changes within the year, there can be no accountability for the delivery of projects and public services by the Ministries/Divisions of the Federal Government.

A secretary who approved budget of its concerned ministry as Principle Accounting Officer cannot be held to account for the delivery of the services by his division. The root cause of the problem which is undermining the legality of the budget arises from the prevailing political culture.

It is considered acceptable to change and modify at will the budget which has been approved by Parliament, and only notify Parliament at the very end of the budget year through a set of tabled supplementary appropriations. This is not the role of Parliament aspired to by the 1973 Constitution.