According to a Business Recorder exclusive, the government has acknowledged that the 6 percent growth target will not be achieved. The growth rate has been revised downward to 5.79 percent based on the seven months’ available data. The primary sources for manufacturing and agriculture data, productive sectors, are the provinces who calculate it district-wise and on-send it to the Pakistan Bureau of Statistics (PBS) which, in turn, computes the national data. The data, therefore, has approximately a two-month time lag. Thus, at present, the PBS has access to only seven-month data; and with five-month data remaining to be on-sent by the provinces – comprising 41 percent time period of a fiscal year - the capacity of the PBS to project the growth rate would, understandably, be severely compromised.

To have access to more accurate projections was one of the main reasons why the budget used to be presented around three weeks prior to the end of the fiscal year (30 June) as it enabled the government to make a more accurate projection of the growth rate that is used to project key macroeconomic variables for the forthcoming fiscal year. These include total revenue as a percentage of Gross Domestic Product (GDP), Federal Board of Revenue’s tax collections as a percentage of GDP, non-tax revenue as a percentage of GDP, current and development expenditure as a percentage of GDP, revenue balance as a percentage of GDP, total public debt as well as actual GDP (in billions of rupees.) Three weeks were generally sufficient for debate on the budget in parliament given that the government had an overall majority (with or without coalition partners) and the constitution disallows any member of a party to vote against the finance bill. However, with the tenure of the Abbasi-led administration ending well before the current financial year ends and the caretakers to be installed do not have the mandate to present a budget, as well as the onset of Ramazan by mid-May, accounts for many extending support for the scheduled presentation of the budget on 27 April - 64 days before the end of the year. This date, however, would not only compromise the quality of data but would also disable the incumbent government from taking informed policy decisions by projecting a growth rate for next fiscal year that would be even more unrealistic than in the past five years when allegations of deliberate data manipulation were constantly made by independent economists.

Politically though the PML-N may benefit from presenting the sixth budget of its five-year tenure as, prior to the elections, it can claim that it has taken pro-poor policy decisions (and curtailed current expenditure while raising development expenditure) and projecting higher revenue collections with lower income tax rates already announced in the April Ordinance); and if the party is not in a position to form the next government after the elections it can accuse its successors of poor management for failure to meet its targets.

It would have been advisable for the government with a little more than a month remaining for the end of its tenure to take members of the opposition parties on board before finalizing the budget unless Miftah Ismail, the Special Advisor to the Prime Minister on Finance, Revenue and Economic Affairs succeeds in presenting a technical budget as he has publicly committed. A technical budget would envisage allocation of funds for ongoing projects that have achieved a high percentage of completion and ideally tax rates would not have been reduced at the tail end of the tenure of this government as that can be seen as pre-poll rigging.