Govt bodies told to restrict assignment accounts to NBP.

ISLAMABAD -- The government has tightened its fiscal controls by restricting the federal and provincial entities to ensure that all their assignment accounts for development projects and non-development expenditures are opened and operated only through the National Bank of Pakistan (NBP), which would be treated as part of the Treasury Single Account (TSA) of the federal government.

To conduct this exercise as required by the InterAnational Monetary Fund (IMF), the government has issued fresh guidelines for opening and operating the so-called Asaan (Easy) Assignment Accounts.

Under the Asaan AssignAment Account Procedure (Local CurrAency) Amended 2023 (AAAP 2023), the assignment accounts for both development projects and non-development expenditures would be part of the TSA (Account No. 1).

The assignment accoAunts of the provincial entities would be part of the consolidated funds of the respective provincial governments.

The Treasury Single Account is a unified structure of government bank accounts enabling consolidation and optimum utilisation of government cash resources.

Article 78 of the Constitution requires that all revenues, loan receipts and all other funds received by or on behalf of the government of Pakistan are either part of the federal consolidated fund (FCF) or the public account of the federation (PAF).

The cash balances of both FCF and PAF are maintained in central account No. 1 (non-food) at the State Bank of Pakistan (SBP). Under the Public Finance Management (PFM) Act of 2019, the FCF and PAF are operated by the finance division.

The new guidelines have directed all the ministries, divisions, corporations, projects and entities that the unspent budget at the close of a financial year will be surrendered by the respective offices or else would be treated as lapsed.

Besides, their main assignment accounts would be opened only in the main NBP branch in Islamabad for the federal government offices across the country, while their sub-assignment accounts could be opened at the branches linked with internet banking for project authorities or entities.

The organisations and entities already submitting their claims for development and non-development expenditures to accounting offices for pre-audit shall not be allowed assignment accounts under any circumstances.

The rules also specify how the principal accounting officers of the respective ministries or entities would designate, replace or nominate the signatories for operating...