Sindh set to launch fiscal framework, debt management legislation

The Sindh government is set to launch a World Bank-supported Medium Term Fiscal Framework (MTFF) and Fiscal Responsibility and Debt Management Legislation FRDML).

In this regard, Chief Minister Syed Murad Ali Shah on Friday presided over a joint meeting of World Bank experts and a team of the Sindh finance department.

The World Bank was represented by economist Mehwish Ashraf, lead economist Fernando Blanco, consultant Ariel Melamud, while the finance department’s five-member team was led by Secretary Finance Najam Shah.

Chief Minister Shah said that the objective to strengthen Sindh’s fiscal planning through the preparation of a medium-term fiscal framework (MTFF) was also expected to support budget preparation and improve resource allocation.

He added that the adoption of fiscal responsibility and debt management legislation would enhance the credibility and predictability of the fiscal policy.

The World Bank economists said that the MTFF was an instrument for fiscal planning to facilitate a more effective resource allocation and it was a tool that integrated policy of objectives with public resources allocation decisions.

Secretary Finance Shah said that the MTFF would improve the consistency of resource availability, expenditure needs, resource allocation and medium-term fiscal restrictions. He added that the finance department under the guidelines of the chief minister had prepared a framework in consultation with the World Bank experts.

The finance secretary told the chief minister that his team was examining the rules and would suggest necessary legislation to launch MFF and fiscal responsibility and debt management.

The chief minister said that his objective was to introduce a fiscal policy under which non-development expenditures could be controlled by creating more fiscal space for the social sector.