The federal government has constituted a high-level committee to examine major fiscal matters and prepare recommendations for Prime Minister Shehbaz Sharif ahead of the announcement of the FY2026–27 federal budget.
One of the central issues under review is the existing cross-subsidy financing mechanism overseen by the Petroleum Division. The committee will also evaluate the possibility of recovering Rs. 72 billion in windfall gains from oil marketing companies.
According to a notification issued by the Ministry of Finance, the committee has been formed under directives from the Prime Minister’s Office and will be chaired by Finance Minister Muhammad Aurangzeb.
The committee includes the ministers for economic affairs, planning and law, alongside PMDU Chief Technical Advisor Musharraf Rasool and senior officials from the finance ministry.
The body has been assigned to review the financial and operational requirements of several ministries, including commerce, power, privatization, and information technology.
It will also evaluate ministry performance and recommend Public Sector Development Program (PSDP) allocations for FY27 based on performance indicators, strategic significance, and consistency with national development priorities.
Additionally, the committee will assess ongoing litigation involving the Power Division in international courts and propose expenditure priorities for cases considered to have a higher likelihood of success.
Another key area of focus is the development of a legal framework that would allow revenue-generating ministries and divisions to retain a portion of their earnings for operational and development spending.
The committee will also review the utilization of Climate Support Levy funds for startups under the Green Initiative Program and examine salary rationalization proposals for Tenure Track System faculty members.
Furthermore, ministries and divisions have been instructed to submit progress reports on rightsizing measures introduced during FY26 and present new proposals aimed at reducing government expenditures in the upcoming fiscal year.
