• Apex court seeks compliance reports from ECP, SBP, finance ministry by 18th
• Govt asked to obtain ex-post facto approval, sanction from NA

ISLAMABAD: The Supreme Court on Friday ordered the State Bank of Pakistan (SBP) to release by Monday Rs21 billion from Account No. I — a principal component of the Federal Conso­lidated Fund (FCF) worth Rs1.39 trillion — for holding much-delayed elections to the provincial assemblies of Punjab and Khyber Pakhtunkhwa.

Headed by Chief Justice of Pakistan (CJP) Umar Ata Bandial and comprising Justice Ijaz-ul-Ahsan and Justice Munib Akhtar, the SC directed the SBP during a chamber hearing to immediately send an appropriate communication to the finance ministry, which will forthwith and immediately issue a proper direction to the Accountant General Pakistan Revenue (AGPR) for increasing the limit of the ceiling by Rs21 billion with respect to the Election Commission of Pakistan’s (ECP) ID No.2826.

The order, issued after over an hour-long hearing, said the situation would immediately be confirmed to the ECP by the finance ministry that would also ensure the AGPR forthwith gives proper intimation and confirmation to the ECP.

On April 12, the apex court cautioned that the federal government’s failure to comply with its April 4 directions to issue Rs21bn in funds to the ECP amounted to ‘disobedience’ and had asked the SBP governor, finance secretary and ECP to appear in chambers on Friday.

The nine-page order issued on Friday stated the entire exercise of sanctioning funds must be done at the earliest, not later than the close of business on Monday (April 17).

Thus, the required amount of Rs21bn would be made available to the ECP for holding the provincial elections.

The order also required the SBP, finance ministry, AGPR and ECP to act together and coordinate fully so that the court direction is implemented within the stipulated timeframe. By April 18, the SC required the SBP, the finance ministry and the ECP to file compliance and confirmation reports about the transfer of the amount.

The court made it clear that this order would be deemed sufficient authority for all purposes for the authorisation of expenditure on the FCF and the federal government would obtain ex-post facto approval and sanction from the National Assembly for authorisation of this expenditure in terms of Article 84 and other applicable provisions of the constitution.

According to the SC order, the matter stands adjourned, but should any need arise, it will be taken up again in such terms as deemed appropriate by the top court.

Insofar as the matters will be taken up once the report required to be filed by the federal government were filed and considered by the ECP, the order said.

The order mentioned that the acting governor of the SBP explained the amount lying in Account No. I (non-food) constituted by far the largest component (98.77 per cent) of FCS.

It was explained that the amount lying in Account No. I was not designated for any particular or special usage whatsoever, while there were regular inflows and outflows in it.

According to the SC order, the acting governor was told that Rs21 billion was required for KP and Punjab elections before being asked if the sum could be made available. In response, the acting governor confirmed to the SC that the transaction could be made, if the court ordered, by the close of business on Monday.

Also, a team from the finance ministry, led by Special Secretary Awais Manzur Sumra, gave a presentation with the assistance of Attorney General for Pakistan Mansoor Usman Awan to the court, in broad terms, about government’s financial position, with reference to present and pending international obligations to the IMF.

From the figures presented to the court, of which even the smallest ran to several hundreds of billions, it became clear that the disbursement of Rs21 billion for fulfilling the constitutional mandate of holding the general elections would, at most, amount to a ‘minuscule increase’ in the obligations of the federal government.

It was stated that the T-bills were issued by the SBP on behalf of the federal government and that even in this perspective, taking the amount would not have any meaningful impact or effect.

The court said that on assessment of the presentations made by SBP and the finance ministry, there was no doubt that Rs21bn required by ECP could be made available within a day.

As to the exact mechanism for the transfer, the order mentioned, the ECP team led by Secretary Omar Hamid Khan explained that funds made available to and utilised by the commission were with the AGPR for which an ID number (2826) was allocated as per ceiling determined by the finance division. The SC directed the finance ministry to send an appropriate communication to the AGPR, directing it to raise the ceiling of the limit associated with the ID No. 2826 by Rs21 billion.

Parliamentary approval

On the other hand, the federal government argued it had carried out its legal and constitutional obligation in pursuance of the directions issued by the SC in its April 4 order, highlighting that the NA rejected the bill titled “Charged Sum for General Election (Provincial Assemblies of Punjab and Khyber Pakhtunkhwa) Act, 2023” on April 13.

It stated that issuance of any monies from the FCF was subject to the parliamentary approval, which had been denied to the federal government by the parliament for the purposes of holding general elections to the Punjab and KP.

As a consequence, the federal government is not authorised under the constitution to ask either the SBP or any other officer or authority to release the funds so directed by the court.

The federal government also apprised the court that keeping in view Article 73(2)(d)(e), read with 81(e), the bill placed before it by the finance division titled: “Charged Sum for General Election (Provincial Assemblies of Punjab and KP) Act, 2023” was approved in the federal cabinet meeting held on April 9.

In order to issue any money from the FCF or create a charge, an act of parliament was necessary, the government argued. Therefore, following the constitutional provisions, the federal government with bonafide intent and in compliance with the April 4 judgement of the Supreme Court discharged its constitutional obligation by promptly placing the bill before the National Assembly on April 10 to meet the deadline contained in the court order. However, the assembly rejected the money bill.

Published in Dawn, April 15th, 2023