3. Contents
• Public Finance
• Public Finance Cycle
• Formulation of Fiscal Policy
• Generation of Revenue from Tax & other Resources
• Expenditure of Funds through the National Budget
• Public Borrowings
• Accountability
4. Public Finance
• Refers to the income & outgo of the government in the pursuit of national
income
• It involves the inflow of financial resources in the form of taxes & other
revenue & outflow of such resources in the form of expenditure to finance
goods & services
5.
6. Formulation of Fiscal Policy
• Fiscal policy refers to the policies on taxation & other revenue expenditure
& borrowings which is intended to promote the stabilization & development
of economy
• Fiscal & Monetary policy is used as a single concept through it has a
different aspect of economic policy but have related impact
• Fiscal & Monetary policy have been crafted in response to requirements of
stabilization & subsequently adjustment programs (SAPs) negotiated by IMF
7. Fiscal Policy
• Monetary policy is generally understood to be that which influences the level
of money supply in the economy
8. Generation of Revenue
• Revenues refer to all cash inflows of the national government treasury which are
collected to support government expenditure but do not the liability of the NG
• A tax is compulsory contribution mandated by law & exacted by the government
for public purpose the major tax collecting agencies of the NG are Federal bureau
of revenue FBR
• Non tax revenues refer to all other impositions or collections of the government in
exchange for services rendered assets conveyed penalties imposed.
9. Expenditure of Funds through the National
Budget
• A budget is plan of financial operation composed of estimate or proposed
expenditure for given period or purposed & the proposed means of
financing them
• The principle activities of government are normally controlled
10.
11. Budget Allocation
• Department of public works
• Agriculture
• Social works
• Health
• Transportation
• Agrarian Reform
• Justice
12. Public Borrowings
• Borrowings refer to funds obtained from repayable sources such as loans
secured by the government from financial institutions & other source both
domestic & foreign to financial various government projects & activities
13. Reasons for Government Borrowing
• Finance NG projects
• Obtain foreign exchange
• Secure financing at more favorable terms than the opportunity cost of
revenues
• Take advantage of benefits attached to the funds e.g technology
• Balance the timing of resources
14. Indicators
• Government claims that debt crises is already over in Pakistan
• Total debt stock as a % of GNP & as a % of exports has been reduce
• The share of concessional debt to total debt stock had
• Foreign exchange reserves have reached at very low level
15. Public Borrowing
• Public debt includes obligations incurred by the government & all its
branches agencies & instrumentalities including those of government
monetary institutions
• It consist of all claims against the government which may be payable in
goods & services but usually in cash to foreign government or individuals or
to persons natural or juridical.
16. Accountability
• Accountability is defined as a condition in which individuals who exercise
power are constrained by external means and internal norms it refers to the
institution of checks & balance in an organization thru which an
administrator accounts for his stewardship of resources or authority
• The political administrative continuum means that elected officials are
politically accountable to the electorate or their constituencies who voted
them to their positions these elected officials are held responsible thru
regular elections & other means recall & referendum.
17. Types of Accountability
• Individual Accountability
• Accountability of Administrators
• Political Accountability
• Accountability of national leaders
18. Types of Accountability
• Individual Accountability
• Public employees are answerable for the responsible efficient & effective
performance pf their task
• Accountability of Administrators
• For their stewardship of the administrative authority resources &
information places at their disposal s leaders of public organization
19. Types of Accountability
• Political Accountability
• Of institutions that must answer for their organizational mandate &
functions particularly as they form part of the incumbent government
strategy for national development
• Accountability of National Leaders
• Elected national leadership must answer for the performance in pursuing
their programs of government & their use of national resources
