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The federal government has decided to close 43 ministries and eliminate 150,000 vacant positions in Phase I of its rightsizing initiative, Finance Minister Muhammad Aurangzeb announced. This initiative aims to optimize operations and reduce costs.
During the press conference, the finance minister discussed the six-month performance of the High-powered Committee on Rightsizing, stating, “We have decided to bring five or six departments under rightsizing in each phase.”
The rightsizing plan involves merging departments and delegating non-essential services to external providers. Aurangzeb stated that he and his team are pinpointing unnecessary structures within the federal government.
The minister announced that 60% of the 150,000 vacant regular positions have been either abolished or classified as dying posts, resulting in a significant financial impact.
The phased implementation of the reforms has commenced, with a review currently underway for six ministries. “All is being done after proper ratification from the federal cabinet,” said Aurangzeb, adding that the count of departments within these ministries will be cut down from 80 to 40.
Furthermore, there will be an integration of ministries, with the merging of entities such as Kashmir Affairs and SAFRON, alongside the dissolution of the Ministry of Capital Administration and Development Division (CAD). The completion of the process is anticipated by June.
Aurangzeb stated that the administration has halted hiring for open roles during the past six months. He stated that the aim of rightsizing extends beyond just reducing expenses; it is about improving the effectiveness of government operations.
The Finance Minister recognized that these measures are following the structural benchmarks set by the International Monetary Fund while emphasizing their importance for the nation’s economic future. He outlined proposals for privatizing taxation, enhancing the energy sector, and delegating non-federal responsibilities to provincial governments.
Aim of the Rightsizing Initiative
The rightsizing initiative aims to enhance government operations by pinpointing activities suitable for privatisation or outsourcing, all while ensuring the public interest is preserved. The aim is to eradicate redundancy and overlaps, especially in areas that have undergone devolution with provinces, while enhancing the effectiveness of public spending through efficiency reforms such as digitisation.
The proposal encompasses a thorough examination of federal agencies, analysing the possibilities for collaboration between the public and private sectors, while also considering the significance and effectiveness of each role. This review includes approximately 400 associated entities and 43 ministries and divisions.
The initiative will be implemented in strategic phases to minimize disruption. These phases include:
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- Wave I: Six ministries are under implementation, including;
- Ministry of Kashmir Affairs + GB
- SAFRON
- Ministry of IT & Telecom
- Ministry of Industries & Production
- Ministry of National Health Services, Regulations & Coordination and CAD
- Wave II: Five ministries are under implementation, including;
- Ministry of Science & Technology
- Commerce Division
- Housing & Works
- National Food Security & Research
- Wave III: Currently under review, covering;
- Federal Education and Professional Training
- Information & Broadcasting
- Heritage
- Finance Division
- Power Division
- Wave I: Six ministries are under implementation, including;
All waves encompass 43 ministries, along with analysis and implementation, which are scheduled for completion during the current fiscal year. The recommendations focus on addressing the federal government’s expenditure of PKR 876 billion.
