The bill was not on the original agenda of the assembly, but Minister of State for Finance Ayesha Ghous Pasha introduced the bill through a supplementary agenda during a protest by members of the Grand Democratic Alliance (GDA).
The amendment bill will strengthen the debt office with resources while providing mandate for effective planning and execution of government loans.
According to the Statement of Objectives and Reasons, the Bill provides a consensual level of public debt with a reduction in the federal fiscal deficit and gross domestic product through effective public debt management.
The bill generally seeks to achieve three key objectives, including limiting the stock of government securities to 10% of GDP, and publishes a Medium Term National Macro Financial Framework (MTMFF). Institutionalization of debt management in a single office involves reporting to the Secretary of Finance instead of the Minister of Finance.
The bill was introduced by then-Finance Minister Shaukat Tareen in the National Assembly last year and was passed at a meeting of the standing committee on February 16 in line with international commitments.
Briefing the committee members, a senior finance ministry official said that the FRDLA-2005 had managed to reduce the federal fiscal deficit and raise the debt-to-GDP ratio to a more prudent level through effective public debt management. Provided.
A Debt Policy Coordination Office was also set up under the Act.
He said the amended bill would strengthen the debt office with effective planning and implementation of government debt management mandates and resources.
The committee was told that the government guarantee is currently 6% of GDP and the total debt reserves are 72% of GDP. Was gone
Similarly, the bill proposed to limit the total public debt and securities reserves to 70% of GDP.
The official said that the bill proposes to increase the total debt to 60% of GDP in 6 years after the financial year 2020-21, as it includes debt at the rate of 2% per annum and in proportion to GDP. Outstanding guarantees are targeted to be reduced to 10% of GDP.
The bill clarifies that in the event of an increase in expenditure, the law also provides for loans so that the work of the system can continue as usual.