PUNJAB PUBLIC FINANCIAL MANAGEMENT ACT 2022

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PUNJAB PUBLIC FINANCIAL MANAGEMENT ACT 2022 
(XXXVII of 2022) 
CONTENTS 
CHAPTER I 
PRELIMINARY 
1. Short title, extent and commencement. 
2. Definitions. 
3. Measures to be taken. 
CHAPTER II 
PLANNING, BUDGETING AND PERFORMANCE MANAGEMENT 
4. Medium-term Planning and Budgeting. 
5. Revenue. 
6. Annual Budget Statement. 
7. Performance reporting. 
8. Expenditure from Provincial Consolidated Fund. 
9. Withdrawal from Public Account. 
10. Grants to be received or paid by the Government. 
11. Grant-in-aid to be paid by the Government. 
12. Supplementary Budget Statement and Excess Budget Statement. 
13. Re-appropriation of funds. 
14. Statement of Excess and Surrender. 
15. Guidelines on Commitment Control System. 
16. Assessment and upgradation of Public Financial Management (PFM) 
System. 
17. Public Financial Management Unit. 
CHAPTER III 
FISCAL RISK MANAGEMENT 
18. Fiscal Risk Management Framework. 
 
 
19. Fiscal risk statement. 
20. Fiscal discipline. 
21. Debt limits. 
22. Compliance with Fiscal and debt provisions. 
CHAPTER IV 
DEBT MANAGEMENT 
23. Authority to borrow or issue guarantees. 
24. Purposes of borrowing. 
25. Functions of Debt Management Unit. 
26. Medium-Term Debt Management Strategy. 
CHAPTER V 
PUBLIC INVESTMENTS 
27. Medium-term Planning for Public Investments. 
28. Approval and monitoring of Public investment projects and programs. 
29. Stock of public investments. 
30. Framework for management of public investments. 
CHAPTER VI 
MANAGING RECEIPTS AND PAYMENTS 
31. Custody of Provincial Consolidated Fund and the Public Account of the 
Province. 
32. Banking arrangements. 
33. Sanctioning of expenditure from the Provincial Consolidated Fund. 
34. Withholding of appropriations. 
35. Cash management. 
36. Special Purpose Fund. 
37. Fund Management Company. 
CHAPTER VII 
ACCOUNTING AND FINANCIAL REPORTING 
38. Accounts. 
 
 
39. Chief Finance and Accounts Officer. 
40. Internal Controls. 
41. Budget Execution Report. 
42. Financial Reports. 
CHAPTER VIII 
PUBLIC CORPORATIONS 
43. Governance of public corporations. 
44. Corporate Finance Unit. 
CHAPTER IX 
MISCELLANEOUS 
45. Implementation. 
46. Indemnity. 
47. Removal of difficulty. 
48. Power to make rules. 
49. Power to make regulations. 
50. Overriding effect. 
TEXT 
1PUNJAB PUBLIC FINANCIAL MANAGEMENT ACT 2022 
(XXXVII of 2022) 
[02 December 2022] 
An 
Act 
to regulate financial affairs in the public sector and matters relating to the Provincial 
Consolidated Fund and Public Account of the Punjab.  
It is  necessary to regulate and  manage financial affairs in the public sector in a 
comprehensive, efficient, transparent and sustainable manner contributing to long -
term socio-economic stability and growth of the Province; to make provisions relating 
to custody of the Provincial Consolidated Fund, the payment of moneys into that 
Fund, the withdrawal of moneys therefrom, the custody of other moneys received by 
or on behalf of the Government, their payment into and withdrawal from the Public 
Account of the Punjab;  and to provide for the matters connected with or ancillary 
thereto in pursuance of Article 119 of the Constitution of the Islamic Republic of 
Pakistan.  
Be it enacted by Provincial Assembly of the Punjab as follows: 
CHAPTER I 
PRELIMINARY 
1. Short title, extent and commencement .− (1) This  Act may be cited as the 
Punjab Public Financial Management Act 2022. 
(2)  This Act extends to whole of the Punjab.  
(3)  This Act shall come into force at once. 
2. Definitions.− (1) In this Act: 
(a) “appropriation” means an expenditure which is a part of the 
Schedule of Authorized Expenditure authenticated under  Article 
123 of the Constitution; 
(b) "authorization" means authorization to withdraw moneys from 
the Provincial Consolidated Fund and Public Account of the 
Punjab against budgetary appropriations; 
(c) “Constitution” means the Constitution of the Islamic Republic of 
Pakistan;  
(d) "financial propriety" means the compliance of this Act, rules and 
regulations for ma intaining high standards of prudence, 
vigilance, due diligence and ensuring value for money while 
incurring expenditure and collecting Government receipts; 
                                                           
1This Act was passed by the Provincial Assembly of the Punjab on 21 November 2022; assented to by the Governor of the 
Punjab on 30 September 2022; and, was published in the Punjab Gazette (Extraordinary), dated: 02 December 2022, pp. 2383-
2396. 
 
 
(e) “Finance Secretary” means Secretary to the Government, 
Finance Department; 
(f) "Government" means Government of the Punjab; 
(g) “prescribed” means prescribed by the rules or the regulations 
made under this Act; 
(h) "re-appropriation" means the transfer of funds from one head of 
account to another head of account within a budget grant; 
(i) “regulations” means the regulations made under this Act;  
(j) “rules” means the rules made under this Act; 
(k) "tax expenditure" means the tax revenue which the Government 
foregoes through the provisions of tax laws that allow 
deductions, exclusions, exceptions, deferrals or preferential 
rates; and 
(l) "technical supplementary grant" means a re -allocation of funds 
which does not impact the Government’s overall authorized 
expenditure from the Provincial Consolidated Fund. 
(2) An expression or a word used but  not defined in this Act, rules and 
regulations made thereunder  shall have the same meaning as  assigned in the 
Constitution, the Punjab Government Rules of Business 2011, Government Finance 
Statistics Manual, Public Sector Debt Statistics: Guide for Compilers and Users and 
any other relevant instrument. 
3. Measures to be taken.− For regulation and management of public finances in 
a comprehensive, efficient, transparent and sustainable manner, the Government 
shall cause the following measures to be taken: 
(a) adequate comprehensiveness of the Budget including the Budgets of 
all relevant institutional units;  
(b) clarity of description of functions, powers and performance indicators of 
the institutional units performing functions for the Government; 
(c) introduction of appropriate checks and balances in the public financial 
management system; 
(d) emphasis on medium -term planning and budgeting horizons, 
frameworks, strategies, and evaluations; 
(e) carrying out of regular reporting of financial statistics including public 
debt, and fiscal risks in accordance with international standards; 
(f) implementation of robust Fiscal Risk Management Framework and 
keeping the Budget Deficit and Public Sector Debt within reasonable 
limits; 
(g) regular spend ing of a reasonable amount of resources on public 
investments; 
(h) formulation of a comprehensive policy for governance of public 
corporations; and 
 
 
(i) adoption of a balanced approach with realistic targets giving the 
relevant institutional units the authority, me ans and resources to 
achieve such targets while installing appropriate mechanisms for 
rewarding good performance and addressing bad performance. 
 
CHAPTER II 
PLANNING, BUDGETING AND PERFORMANCE MANAGEMENT 
4. Medium-term Planning and Budgeting .− (1) The Government shall adopt 
planning and budgeting for a medium -term of three to five years to foster discipline 
and consistency in financial management. 
(2) During each financial year, the Finance Department shall prepare a 
Medium-term Fiscal Framework and Budget Strategy encompassing at least the next 
three financial years, and submit to the Government for approval. 
(3) Upon approval, the Medium -term Fiscal Framework and Budget 
Strategy shall be published on official website of the Finance Department. 
(4) The timelines fo r preparation, submission and approval of 
aforementioned documents shall be as prescribed.  
(5) The Finance Department shall finalize the estimates to be included in 
Medium-term Fiscal Framework and Budget Strategy in consultation with all 
Departments of the G overnment, Planning and Development Board  and any other 
public sector institution, whether federal or provincial, whose input, in the opinion of 
the Finance Department, is important for this purpose. 
(6) The Medium-term Fiscal Framework and Budget Strategy shall include: 
(a) socio-economic objectives of the Governments and its policy 
priorities and goals pertaining to important fiscal variables 
including revenue, expenditure, budget balance and debt;  
(b) policy targets and allocations expressed as percentage of Gross 
Domestic Product ( GDP), percentage of total expenditure, 
percentage of total debt or any other meaningful measure, 
pertaining to the important fiscal variables and their major 
components including tax and non -tax revenues, direct and 
indirect taxes, user charges for certain services, operating 
expenses, public investments, allocation of expenditure among 
various functions of the Government, external and domestic 
debt; 
(c) baseline projections of the important fiscal variables; 
(d) details of the major factors, con straints and assumptions 
underlying the projections;  
(e) details of relevant policies of the Government; 
(f) Key Performance Indicators in the form of targeted outcomes 
and outputs for each Department; 
(g) single expenditure ceiling for each Department to achieve the  
Key Performance Indicators; 
 
 
(h) reconciliation of Expenditure Ceilings for Departments with 
functional and economic classification; 
(i) desired flexibility in the spending plans of Departments due to 
unexpected shortfalls in Revenue or increases in Expenditure 
resulting from various fiscal risks; and 
(j) details and justification of significant gaps between the priorities, 
goals, targets, or allocations in the current and the previous 
Medium-term Fiscal Framework and Budget Strategy. 
(7) For the purposes of formulatio n and execution of medium -term or 
annual Budgets, each  Department shall represent, and be responsible for, all 
institutional units under its administration, and the Government shall ensure that 
every institutional unit forming part of the Government is re presented by a 
Department. 
5. Revenue.− (1) Every Department responsible for collecting tax or non -tax 
revenue shall prepare and update on annual basis, a Business Plan to enforce the 
relevant laws and collect the revenue in an efficient manner. 
(2) The Business Plan shall encompass the next three financial years and 
contain annual revenue targets and the key measures to achieve those targets.  
(3) The Business Plan shall be in line with the Medium -term Revenue 
Mobilization Strategy approved by the Govern ment in case of revenue sources 
included in the Strategy.  
(4) The relevant Departments shall, within three months of the close of 
each financial year, submit a performance report to the Government mentioning the 
performance relative to the targets set in the Business Plan and explain reasons for 
deviations, if any, from the targets. 
6. Annual Budget Statement .− (1) The Finance Department shall prepare the 
Annual Budget Statement, containing the consolidated budget of all institutional units 
that form part of t he Government, for the next financial year and submit it to the 
Government. 
(2) The Annual Budget Statement shall include: 
(a) estimates of revenue and expenditure along with their 
bifurcation on the basis of functional classification, economic 
classification and Departments; 
(b) estimates of Net Operating Balance, Primary Balance and 
Budget Balance; and 
(c) estimates of Net Borrowing / Net Lending and its bifurcation into 
Net Acquisition of Financial Assets and Net Incurrence of 
Liabilities. 
(3) In addition to the Budget Esti mates for the next financial year, the 
Annual Budget Statement shall also provide the Revised Estimates for the ongoing 
financial year. 
 
 
Explanation: The expression “actual figures” means the figures audited by 
the Auditor General of Pakistan or, in case th e audit is still in process, provisional 
figures as per the Integrated Financial Management Information System. 
(4) Each Department shall be responsible for preparing, submitting and 
negotiating the annual Budget in respect of all institutional units under its  
administrative control. 
(5) Each Department shall prepare its annual Budget estimates in line with 
the expenditure ceilings approved in the Medium -term Fiscal Framework and Budget 
Strategy. 
(6) Each Department’s Key Performance Indicators and Budget estimates 
shall be deliberated and finalized for submission to the Government, in such manner 
as may be notified by the Finance Department.  
7. Performance reporting.− (1) Within three months of the close of a financial 
year, each Department shall submit a performance report to the Government. 
(2) The performance report shall contain details of: 
(a) of the actual results achieved during the financial year regarding 
the outputs, outcomes, and key performance indicators agreed 
at the time of finalization of the budget for that financial year; 
and  
(b) the targeted outputs, outcomes, and key performance indicators 
achieved along with the reasons for gap between the targets 
and actual results. 
8. Expenditure from Provincial Consolidated Fund.− (1) Expenditure from the 
Provincial Consolidated Fund shall include the following payments either as Charged 
Expenditure or as Other Expenditure: 
(a) expenses, other than investments, in connection with 
Government operations; 
(b) Investments in non-financial assets; 
(c) acquisition of financial assets; and 
(d) discharge of liabilities. 
 (2) Other Expenditure includes all Expendi ture other than Charged 
Expenditure as may be approved by the Government.  
9. Withdrawal from Public Account .− Withdrawal from Public Account shall 
include the following payments: 
(a) expenses other than investments; 
(b) investments in non-financial assets; 
(c) acquisition of financial assets; and 
(d) discharge of liabilities. 
 
 
 
10. Grants to be received or paid by the Government .− (1) The Finance 
Department shall prepare a Policy for providing grants to other governments and 
foreign organizations and submit it to the Government for approval.  
(2) The Policy shall include the grants payable to local governments of the 
Punjab.  
(3) The pro cess and timelines for preparation and approval of the Policy 
shall be as prescribed. 
(4) All authorizations and payments of grants to other governments and 
foreign organizations shall be in accordance with the Policy.  
(5) All Grants receivable by the Government from other governments or 
international organizations shall be received by the Finance Department.  
(6) Subject to approval of the Government, the Finance Secretary or any 
other officer authorized by the Government may enter into agreements for the 
purpose of providing and receiving grants from other governments and foreign 
organizations.  
(7) The Finance Department shall issue Guidelines for receipt of Grants 
from other governments and foreign organizations by the Government for guidance 
of all Departments. 
 
11. Grant-in-aid to be paid by the Government .− (1) The Finance Department 
shall prepare a Policy for providing grant-in-aid and submit it to the Government. 
(2) The process and timelines for preparation and approval of the Policy 
shall be as prescribed. 
(3) All authorizations and payments of grant -in-aid shall be in accordance 
with the Policy. 
 
12. Supplementary Budget Statement and Excess Budget Statement .− (1) 
The Government shall not authorize a Supplementary Expenditure unless it is 
satisfied that adequate resources shall be available for this purpose.  
(2) The Supplementary Expenditure Statement shall include reasons for 
incurring the Supplementary Expenditure.  
(3) The Excess Expenditure Statement shall include reasons for incurring 
the Excess Expenditure and the measures to prevent such instances in future.  
(4) The conditions, process and timelines pertaining to Supplementary 
Budget Statement and Excess Budget Statement shall be as prescribed. 
 
13. Re-appropriation of funds .− (1) The head of a Department or any other 
officer authorized by him may sanction re -appropriation of funds pertaining to that 
Department. 
(2) Total amount re -appropriated by a Department during a finan cial year 
shall not exceed 20% of the total Expenditure approved as part of the Budget 
Estimate of that Department except under extraordinary circumstances and with prior 
approval of the Finance Department. 
 
 
(3) The conditions, process and timelines pertaining to re-appropriation of 
funds shall be as prescribed.  
 
14. Statement of Excess and Surrender .− (1) Each Department shall submit a 
Statement of Excess and Surrender containing:  
(a) anticipated expenditure in excess of the schedule of Authorized 
Expenditure; or  
(b) authorized Expenditure to be surrendered due to anticipated 
savings during a financial year.  
(2) The Statement shall include reasons for anticipation of excess 
Expenditure or sur rendering a portion of the Authorized Expenditure, as the case 
may be. 
(3) The Finance Department shall, after obtaining further information that it 
considers necessary, communicate Revised Budget Estimate for the financial year to 
each Department. 
(4) The conditi ons, process and timelines pertaining to Statement of 
Excess and Surrender shall be as prescribed.  
 
15. Guidelines on Commitment Control System.− The Finance Department 
shall frame Guidelines related to multi-annual Commitment Control System. 
 
16. Assessment and upgradation of Public Financial Management (PFM) 
System.− (1) For continuous upgradation of the PFM System in line with the 
international standards and best practices, the Finance Department shall carry out 
an assessment of its Public Financial Management System in accordance with the 
international Public Expenditure and Financial Accountability (PEFA) framework on a 
regular basis.  
(2) The assessment shall be carried out at least once in every four years 
through a qualified and independent organization. 
(3) The assessment report shall be presented to the Government a nd 
shall, afterwards, be published on the website of the Finance Department. 
 
17. Public Financial Management Unit.− The Public Financial Management Unit 
(PFMU) established in the Finance Department shall perform the following functions:  
(a) preparation of Me dium-term Fiscal Framework and Budget Strategy in 
consultation with the relevant stakeholders; 
(b) preparation of annual Fiscal Risk Statement including the statement of 
compliance of the provisions of this Act; 
(c) preparation of Medium -term Revenue Mobilization Strategy 
encompassing next three financial years in consultation with relevant 
stakeholders;  
(d) preparation of Medium -term Expenditure Management Policy 
encompassing next three financial years in consultation with relevant 
stakeholders;  
 
 
(e) monitoring the actua l results of the policies and frameworks and shall 
publishing an annual progress report in this regard; 
(f) preparation of a training and development plan for the staff of the 
Finance Department, monitoring the implementation of the plan, and 
publishing an annual report in this regard; and 
(g) any other functions as prescribed under the rules or as assigned by the 
Finance Secretary. 
 
CHAPTER III  
FISCAL RISK MANAGEMENT 
18. Fiscal Risk Management Framework .− (1) The Finance Department shall 
prepare a Fiscal Risk Management Framework, and submit it to the Government for 
approval. 
(2) The Finance Department may, from time to time, propose to the 
Government, revisions in the Fiscal Risk Management Framework to enhance its 
effectiveness for approval.  
 
19. Fiscal risk sta tement.− (1) The Finance Department shall prepare a Fiscal 
Risk Statement on annual basis, and submit it to the Government for approval. 
(2) The Government may review approve the Fiscal Risk Statement, and 
shall lay it before the Provincial Assembly along with the Annual Budget Statement. 
(3) The Statement shall contain information on:  
(a) major sources of risk that can result in significant deviations 
between actual and expected fiscal outcomes; 
(b) estimates of Tax Expenditure for the next financial year 
prepared with t he assistance of all Departments and agencies 
engaged in collection of taxes; 
(c) fiscal risks posed by explicit as well as implicit contingent 
liabilities; 
(d) compliance status of fiscal and debt rules contained in this Act 
along with the relevant figures, and, in case of non -compliance, 
the reasons thereof; 
(e) assessment of the implementation status and effectiveness of 
the Fiscal Risk Management Framework; and 
(f) measures needed to strengthen the management of fiscal risks. 
 
20. Fiscal discipline .− The Government sha ll take appropriate measures to 
maintain a balanced Budget over the long run by observing the following quantitative 
limits:  
(a) in any financial year, Net Investment in Non -financial Assets shall not 
be less than 15% of average revenue of three preceding financial 
years; and 
 
 
(b) in any financial year, the Budget Deficit shall not exceed 10% of 
average revenue of three preceding financial years.  
 
21. Debt limits.− The Government shall take appropriate measures to keep the 
Public Sector Debt and Guarantees by observing the following quantitative limits: 
(a) stock of Public Sector Debt and Guarantees shall not, at any time, 
exceed 200% of the avera ge revenue of three preceding financial 
years; 
(b) Government Debt and Guarantees shall not, at any time, exceed 160% 
of the average revenue of three preceding financial years; 
(c) public corporations Debt and Guarantees shall not, at any time, exceed 
40% of the average revenue of three preceding financial years; and 
(d) interest expense on Government Debt shall not, in any financial year, 
exceed 12% of the average revenue of three preceding financial years. 
22. Compliance with Fiscal and debt provisions .− (1) Complian ce with fiscal 
and debt provisions laid down in this Act shall be monitored based on annual 
accounts prepared by the Accountant General’s Office and audited by the Auditor 
General’s Office after the end of a financial year. 
(2) Breach of any of the Fiscal and Debt provisions for two consecutive 
years shall be treated as non-compliance.  
(3) In case of non -compliance, the Government shall make all reasonable 
efforts to return to the compliant status within two financial years. 
(4) The Government shall, at the time of presentation of Annual Budget 
Statement before the Assembly, communicate the reasons for non -compliance and 
the strategy and time frame for achieving compliance. 
 
CHAPTER IV  
DEBT MANAGEMENT 
23. Authority to borrow or issue guarantees .− (1) The  authority to borrow or 
give a guarantee shall vest in the Government.  
(2) All Government borrowings and guarantees shall be executed by the 
Finance Secretary or any other officer as the Government may specifically authorize 
for the purpose. 
24. Purposes of b orrowing.− The Government may borrow for all or any of the 
following purposes: 
(a) to finance the Budget deficit;  
(b) to meet temporary cash or liquidity needs;  
(c) to make investment in non-financial or financial assets; 
(d) to repay, refinance, reschedule, restructure , prematurely retire or swap 
existing debt; 
 
 
(e) to pay a liability; and 
(f) to on-lend the borrowed funds to any institutional unit forming part of 
the Public Sector.  
25. Functions of Debt Management Unit .− The Debt Management Unit 
established in the Finance Department shall: 
(a) prepare the Medium -Term Debt Management Strategy as required 
under this Act; 
(b) prepare Annual Borrowing Plan in consultation with the relevant 
stakeholders and in conformity with the Medium -term Debt 
Management Strategy; 
(c) formulate and implement  a process for raising domestic debt through 
various sources such as Government securities, bank loans etc. 
subject to any modifications that may be made in the process from time 
to time, with  prior approval of the Finance Secretary; 
(d) prepare a Framework f or Management of Guarantees in consultation 
with relevant stakeholders, with approval of the Government, for 
issuance, valuation, and monitoring of Government Guarantees; 
(e) undertake domestic borrowings through government securities, bank 
loans or any other domestic borrowing instruments; 
(f) undertake external borrowings through commercial sources including 
debt securities such as bonds, sukuks, bank loans or any other 
commercial borrowing instruments; 
(g) coordinate with the Planning and Development Board (P&DB) in raising 
external debt through multilateral or bilateral sources and provide 
advice to P&DD on financial terms and conditions of external debt; 
(h) advise the Finance Secretary in evaluation of requests for Government 
Guarantees made by Public Corporations; 
(i) maintain consistent and authenticated record of Government Debt and 
Guarantees; 
(j) prepare a comprehensive debt bulletin on semi -annual basis in 
accordance with the international standards contained in ‘Public Sector 
Debt Statistics: guide for compilers and use rs’ and in case the debt 
statistics contained in the debt bulletin are not fully in accordance with 
these standards, appropriate disclosures shall be made; 
(k) monitor compliance with the Debt Rules provided in this Act; 
(l) ensure that Debt Management Performance  Assessment (DeMPA) is 
carried out in accordance with the international standards at least once 
in four years; 
(m) act as the investor relations office of the Finance Department in 
matters pertaining to Government Debt and Guarantees; and 
(n) perform any other function as may be prescribed. 
 
 
 
26. Medium-Term Debt Management Strategy .− (1) The Finance Minister shall 
approve a Medium -term Debt Management Strategy for managing the Government 
debt, encompassing three financial years and update it on annual basis in line  with 
the Medium-term Fiscal Framework and Budget Strategy. 
(2) The Medium-term Debt Management Strategy shall provide for: 
(a) debt portfolio of the Government;    
(b) future borrowing requirements of the Government and key 
features of the strategy to meet those requirements;  
(c) identification of areas or sources of debt where the debt has 
exceeded prudent limits and key features of the strategy to 
partially or fully retire such debt to bring it within reasonable 
limits;  
(d) major risk exposures of the debt portfolio and the key elements 
of the strategy to manage those risks including the following; 
(i) average time to maturity of debt portfolio; 
(ii) share of fixed rate and floating rate debt; and 
(iii) share of debt and guarantees. 
(e) any other factors that may affect the d ebt management strategy; 
and 
(f) the projections of key measures of debt burden including:  
(i) Government Debt and Guarantees along with its 
bifurcation into Domestic Debt and External Debt;  
(ii) ratio of Government Debt and Guarantees to Revenue; 
and 
(iii) ratio of Government Debt Service to Revenue. 
(3) The Medium -Term Debt Management strategy shall be published on 
the  website of the Finance Department along with the Budget documents. 
 
CHAPTER V 
PUBLIC INVESTMENTS 
27. Medium-term Planning for Public Investments.− (1) The Planning and 
Development Board shall prepare a Growth Strategy for the province of Punjab, and 
submit it to the Government for approval.  
(2) The Growth Strategy shall contain the following: 
(a) socio-economic targets to be achieved over the next three 
financial years;  
(b) key features of the strategy to achieve those targets;  
(c) fair allocation of resources to strive for regional equalization and 
balance in the distribution of resources; and 
(d) sectoral /departmental plans for public investments to b e made 
for this purpose. 
 
 
(3) The process and timelines for preparation and approval of the Growth 
Strategy shall be as prescribed. 
(4) The Planning and Development Board shall notify guidelines to be 
followed for timely preparation of Growth Strategy including the  sectoral plans, and 
the Planning and Development Board may, from time to time, amend the process.  
(5) The Departments shall prepare and update the medium -term Public 
Investment Plans in consultation with the Planning and Development Board and 
ensure that estimates of costs and revenues are prepared for each Public 
Investment project or program included in such Plans. 
 
28. Approval and monitoring of Public investment projects and programs .− 
(1) All public investment projects and programs included in Annual Development 
Plan of the Government in a financial year shall: 
(a) be part of the respective sectoral or departmental plan approved 
by the Government along with the Growth Strategy; and 
(b) have undergone the process for appraisal and approval of public 
investment projects.  
(2) The Planning and Development Board shall prepare and notify  a 
Planning Manual containing the criteria and process for appraisal, approval and 
monitoring of public investment projects and programs for inclusion in Annual 
Development Plan. 
(3) The Planning Manual shall include the following: 
(a) criteria for deciding whether to execute a project or program in 
Public Private Partnership or Project Finance modes or as part 
of the regular Public Investment plan; 
(b) minimum projected financial rate of return at the time of 
appraisal and approval; and 
(c) mechanisms for monitoring and reporting of the actual financial 
rate of return over the life of the project or program. 
 
29. Stock of public investments .− (1) The Planning and Development Board 
shall maintain stock of public investments made by the Government in non -financial 
assets. 
(2) For the purpose of subsection (1), the Planning and Development 
Board shall maintain an Asset Register in electronic form.  
(3) The Asset Register shall include the following in formation in respect of 
individual non-financial assets during and up to the financial year and the flexibility to 
aggregate the information for various categories of non-financial assets: 
(a) acquisition of non-financial assets; 
(b) disposal of non-financial assets; 
(c) consumption of fixed capital in respect of non -financial assets; 
and 
(d) net investment in non-financial assets. 
 
 
(4) The Planning and Development Board shall issue guidelines for 
updating the Asset Register on a regular basis, and all Departments including other 
institutional units of the Government shall follow such guidelines. 
 
30. Framework for management of public investments.− (1) The Planning and 
Development Board shall approve a Public Investment Management Framework 
consisting of good practices in th ree key phases of public investment management 
consisting of planning, budgetary allocation and implementation. 
(2) Good practices mentioned in subsection (1) shall include: 
(a) in planning phase:  
(i) appropriate measures to evaluate the financial or 
economic returns of public investments; 
(ii)  provincial and sectoral planning, such as prioritization, 
multi-year costing; 
(iii)  coordination among entities, such as coordination 
between provincial and local government institutions; 
(iv)  project appraisal; and 
(v)  alternative infrastructure financing, such as public private 
partnerships; 
(b) in budgetary allocation phase:  
(i)  multi-year budgeting; 
(ii)  budget comprehensiveness and unity; 
(iii)  adequate budgeting for investment; 
(iv)  adequate budgeting for maintenance; and 
(v)  project selection; and 
(c) in implementation phase: 
(i) procurement; 
(ii) availability of funding; 
(iii) portfolio management; 
(iv) project management; and 
(v) monitoring of public assets. 
(3) The Planning and Development Board shall, at least once in every four 
years, carry out a Public Investment Management Assessment (PIMA) in 
accordance with international standards.  
(4) After the close of each financial year, the Planning and Development 
Board shall submit an annual report to the Government in respect of public 
investments in non-financial assets.  
(5) The report shall include the following:  
(a) stock of non-financial assets at the end of the financial year; 
 
 
(b) trends in net investment in non-financial assets; and 
(c) lessons learned and good practices introduced in management 
of public investments. 
 
CHAPTER VI 
MANAGING RECEIPTS AND PAYMENTS 
31. Custody of Provincial Consolidated Fund and the Public Account of the 
Province.− (1) The  custody of the Provincial Consolidated Fund and the Public 
Account of the Province shall vest in the Finance Department under the overall 
supervision of the Government. 
(2)  Profit accrued on Moneys, in addition to the Government Treasury or 
State Bank of  Pakistan, placed in commercial bank accounts with the permission of 
the Finance Department under this Act or the rules made thereunder, shall be 
regulated by guidelines to be issued by Finance Department. . 
 
32. Banking arrangements.− (1) The Government s hall maintain separate bank 
accounts for the purpose of Provincial Consolidated Fund and Public Account with 
the State Bank of Pakistan. 
(2) A separate bank account for the purpose of Public Account shall be 
opened within two year of commencement of this Act. 
(3) After a separate bank account is opened: 
(a) all future allocations pertaining to the Public Account shall be 
transferred in this bank account; and 
(b) a plan shall be approved and implemented by the Finance 
Department to determine the outstanding liabilities paya ble from 
the Provincial Consolidated Fund to the Public Account and pay 
those liabilities by making transfers in the separate bank 
account over a period not exceeding fifteen years. 
(4) All accounts of the Government shall be operated by authorized 
signatories as prescribed by the Finance Department. 
(5) The Finance Department may, from time to time, open or allow any 
Department or other Government Unit to open accounts with commercial banks 
regulated by State Bank of Pakistan  under such conditions and process  as  may be 
prescribed. 
(6) All receipts and payments by the Government, shall be routed through 
the bank account of Provincial Consolidated Fund, and such receipts and payments 
which are not routed through the bank account, due to any reason whatsoever, shall 
be recorded in the Government accounts as if these were received in, or paid from, 
the Provincial Consolidated Fund, as the case may be.  
 
33. Sanctioning of expenditure from the Provincial Consolidated Fund .− (1) 
No Expenditure shall be made from the Provinc ial Consolidated Fund or Public 
Account until it has been sanctioned by the Government or the Finance Department 
as the case may be, and is part of: 
 
 
(a) schedule of Authorized Expenditure;  
(b) Supplementary Grant including Technical Supplementary Grant; 
or 
(c) re-appropriation. 
(2) The unspent portion of Authorized Expenditure shall lapse at the close 
of the relevant financial year. 
 
34. Withholding of appropriations .− (1) The Finance Department may, 
suspend, withdraw, limit or place conditions on any budget appropr iation or other 
authority issued by it if it is satisfied that such action is required by reason of a 
financial exigency or is in the public interest. 
(2) The effect of such decisions shall be incorporated in Revised Budget 
Estimates included as part of the subsequent Annual Budget Statement. 
 
35. Cash management .− (1) The Finance Department shall maintain Cash 
Management Framework for effective cash management for the Government.  
(2) The Framework shall include the following: 
(a) need, objectives, and constraints per taining to cash 
management; 
(b) roles and responsibilities of relevant government units or offices, 
within or outside the Finance Department, pertaining to cash 
management; 
(c) average cash balances to be maintained to meet liquidity needs 
of the Government; and 
(d) minimum period for which cash flow and liquidity projections 
shall be maintained.  
(e) investment policy for prudent investment of cash balances in line 
with the objectives and constraints pertaining to cash 
management. 
 
36. Special Purpose Fund.− (1) A Specia l Purpose Fund may be established by 
the Government.  
(2) In case a Special Purpose Fund is neither a public corporation nor is 
owned by a public corporation: 
(a) the Fund shall be a part of the Public Account; 
(b) the moneys appropriated for the Fund shall be transfe rred to the 
bank account maintained in State Bank of Pakistan for the 
purpose of Public Account; 
(c) the Government shall notify the purpose of the Fund, the 
Department responsible for its management; 
(d) the Government may notify dissolution of a fund if it is sa tisfied 
that either: 
 
 
i. the purpose for which the fund was established has been 
fully served; or 
ii. it is in the public interest to dissolve the fund. 
(e) the Government shall approve Rules for management of Special 
Purpose Funds including the treatment of their assets and 
liabilities in case of dissolution; and 
(f) separate policies may be framed, in line with the Rules, in 
respect of individual Funds. 
37. Fund Management Company .− (1) The Government shall set up a Fund 
Management Company to manage all long-term funds established by the 
Government, or any not -for-profit entity owned or controlled by the Government, for 
various purposes such as pension funds, general provident funds,  endowment 
funds, foundations etc. 
(2) The Fund Management Company shall be a Non -banking Finance 
Company regulated by the Securities and Exchange Commission of Pakistan 
(SECP) and it shall obtain licenses to engage in Asset Management, Investment 
Advisory and Pension Fund Management businesses. 
(3) The Finance Department shall be the  Administrative Department of the 
Fund Management Company. 
(4) Any Department or not -for-profit entity responsible for oversight and 
management of a long -term fund, shall enter into an Agreement with the Fund 
Management Company for outsourcing of investment ma nagement services and the 
Government may approve a Master Agreement for this purpose which shall contain 
general clauses and allow separate investment policy for each fund. 
 
CHAPTER VII 
ACCOUNTING AND FINANCIAL REPORTING 
38. Accounts.− The Accounts of the Government shall be kept by the Auditor 
General under Articles 169 and 170 of the Constitution.  
 
39. Chief Finance and Accounts Officer .− (1) A Finance and Accounts Unit 
shall be established in each Department which shall be headed by a Chief Finance 
and Accounts Officer. 
(2) The Chief Finance and Accounts Officer shall be appointed on such 
terms and conditions as may be prescribed.  
(3) The Finance and Accounts Unit shall: 
(a) prepare accounts and financial reports of the Department or a 
regular basis; 
(b) prepare the annual Budget of the Department; 
(c) prepare the internal controls manual of the Department in line 
with the guidelines for internal controls issued by the Finance 
Department; 
 
 
(d) implement internal controls to ensure financial propriety in the 
Department; 
(e) coordinate with Auditor General of Pakistan for the purpose of 
Audit as mandated by the Constitution or any other law; and 
(f) perform any other function assigned by the Department. 
 
40. Internal Controls.− (1) The Finance Department shall issue Guidelines for 
Internal Controls in all Departments and other institutional units forming part of the 
Government. 
(2) Every Department shall prepare Internal Controls Manual containing 
internal control processes and procedures and such Internal Controls Manual shall 
be in accordan ce with the Guidelines of Internal Controls issued under subsection 
(1). 
 
41. Budget Execution Report .− (1) The Finance Department shall prepare a 
Budget Execution Report on semi -annual basis for first six months of the financial 
year or the full financial year, as the case may be.  
(2) The report shall contain: 
(a) comparison of budgeted versus actual figures of Revenue, 
Expenditure, Budget Balance and Net Borrowing / Net Lending 
and their important sub-categories;  
(b) computation of variance of actual figures relati ve to the 
budgeted figures; and 
(c) variance analysis containing explanation of the underlying 
factors and developments contributing to the differences 
between actual and budget figures. 
(3) The Finance Department shall place the Report before the Government 
for information and shall also publish it on its official website. 
(4) Timelines and process for preparation and publishing of the Report 
shall be as prescribed. 
 
42. Financial Reports .− (1) The Government shall maintain high standards of 
transparency and international comparability in its Financial Reports. 
(2) The Finance Department shall issue Financial Reports on biannual 
basis. 
(3) The Finance Department shall place the annual Financial Reports 
before the Government and subsequently publish these reports on its website. 
(4) Timelines and process for preparation and publishing of the Financial 
Reports shall be as prescribed. 
(5) The Financial Reports published after three years of commencement of 
this Act shall be in line with the international standards and guidelines laid down in 
Government Finance Statistics Manual. 
 
 
(6) The Finance Department shall, at least once in every five years, carry 
out an assessment of the quality of the financial reports and the underlying statistics 
according to international Data Quality Assessment Framework.  
 
CHAPTER VIII  
PUBLIC CORPORATIONS 
43. Governance of public corporations.− (1) The Government shall constitute a 
Committee for Governance of public corporations. 
(2) The Committee shall:  
(a) prepare the policy for Governance of public corporations for 
consideration and approval of the Government; 
(b) implement the Policy for Governance of Public Corporations; 
and 
(c) submit, within six months of the close of each financial year, an 
Annual Report to the Government regarding the governance of 
public corporations. 
(3) The Policy shall include the following: 
(a) criteria for establishment, dissolution, privatization or operation, 
of for-profit or not-for-profit basis, of Public Corporations; 
(b) criteria and process for appointment, removal and performance 
evaluation of directors on the governing bodies, such as Board 
of Directors, of Public Corporations; 
(c) principles and guidelines for human resource management 
policies of Public Corporations; 
(d) principles and guidelines for performance management of Public 
Corporations; 
(e) standards and guidelines for compilation and reporting of 
consolidated financial statements of various categories of, or all, 
Public Corporations; and 
(f) principles and guidelines for identification, disclosure and 
management of risks faced by Publ ic Corporations that have, or 
are likely to have, fiscal implications for the Government.  
 
44. Corporate Finance Unit.− (1) The Corporate Finance Unit established in the 
Finance Department shall: 
(a) assist the Finance Department in evaluating requests of pub lic 
corporations for financial support from the Government; 
(b) review audited reports of public corporations and monitor 
compliance or redressal of audit observations and 
recommendations by public corporations;  
 
 
(c) prepare and implement a mechanism for monitorin g compliance 
of applicable laws, rules, regulations and policies by the public 
corporations; 
(d) maintain electronic database of data contained in quarterly 
financial reports of public corporations and design and 
implement a database management system for this purpose; 
(e) prepare annual consolidated financial reports of all public 
corporations, and various categories thereof, in line with good 
international practice; and 
(f) perform any other function assigned to it by the Finance 
Department. 
(2) The Corporate Finance Unit may obtain such information from a public 
corporation on such format and in such manner as the Unit may think fit for effective 
performance of its functions under this Act.  
 
CHAPTER IX 
MISCELLANEOUS 
45. Implementation.− (1) Within six months of commencement of this Act , the 
Finance Department shall prepare a plan for implementation of this Act.  
(2) The plan shall ensure that the provisions of this Act are fully 
implemented within three financial years following the year in which  this Act comes 
into effect. 
(3) The Finance Department shall take all the steps including issuance of 
guidelines to other departments, necessary to execute the provisions of this Act. 
 
46. Indemnity.− No suit, prosecution or other legal proceedings shall lie against 
the Government or any of its offices or officers for any act or omission done in good 
faith under this Act or the Rules framed under, or validated by, this Act.  
 
47. Removal of difficulty .−  If  any difficulty arises in giving effect to any of the 
provisions of this Act, the Government may make such order, not inconsistent with 
the provisions of this Act, as it may consider necessary for removal of such difficulty.  
 
48. Power to make rules.− (1) The Government may, by notification in the official 
Gazette, make rules for carrying out the purposes of this Act 
(2) The Treasury Single Account Rules shall be made within two year of 
the commencement of this Act. 
(3) All existing rules, regulation s, policies, processes and procedures 
pertaining to Public Financial Management shall continue in force until altered, 
amended or repealed. 
(4) Without prejudice to the generality of subsection (3), the following rules 
and the manual shall remain valid, an d shall be deemed to have been made under 
this: 
(a) the Punjab  Delegation of Financial Powers Rules, 2016; 
 
 
(b) the Treasury Rules (Punjab) and Subsidiary Treasury Rules; 
(c) the Punjab Financial Rules Vol. I and Vol II; 
(d) Departmental Financial Rules (relating to the P ublic Works and 
Forest Department); and 
(e) the Punjab Budget Manual. 
 
49. Power to make regulations .− Subject to this Act and the rules, the Finance 
Department may, by notification in the official Gazette, make regulations for carrying 
out the purposes of this Act.  
 
50. Overriding effect .− In the event of any conflict or inconsistency between a 
provision of this Act and a provision of any othe r law, the provision of this Act shall 
prevail to the extent of such conflict or inconsistency.