Govt mulling revival of austerity measures, decision to be taken soon: Tarar

Information Minister Ataullah Tarar announced on Monday that the government was contemplating the reinstatement of austerity measures that were part of a previous fuel conservation initiative. These measures were introduced on March 9th in an effort to counterbalance the effects of the ongoing US-Iran conflict. The austerity steps included reducing fuel allowances by 50% for official vehicles, cutting lawmakers' salaries, and implementing a partial remote work policy in the public sector.

Tarar discussed these points during a press conference alongside Information Technology Minister Shaza Fatima Khawaja and Petroleum Minister Ali Pervaiz Malik. They were briefing the public about the government's recently launched fuel relief scheme, which went into effect on Sunday in response to the surge in oil prices.

During the briefing, Tarar noted that Prime Minister Shehbaz Sharif had ordered consultations on the austerity measures, some of which are still active, such as control over market timings. He added that the government was reviewing the previous measures to determine which should be revived under the current circumstances. Tarar confirmed that a decision would be made soon.

The government had ceased the austerity measures on June 19th, with the exception of market timings. However, in July, there were indications that the government might revert to fuel conservation and austerity measures. This decision was taken in light of the worsening situation in the Middle East, including hostilities in the Strait of Hormuz and threats from Houthi rebels in the Bab al-Mandab, which have disrupted oil supply routes and led to a spike in fuel prices.

As of now, the price of petrol is Rs375.82 per liter, and high-speed diesel (HSD) is priced at Rs403.32 per liter.

In terms of the relief scheme, Tarar mentioned that motorcycles, rickshaws, and vehicles up to 800cc would receive a relief of Rs100 per liter. The prime minister instructed Deputy Prime Minister and Foreign Minister Ishaq Dar to ensure that transport fares did not increase following the scheme's implementation. Tarar also revealed that the scheme's steering committee would comprise chief secretaries from all four provinces, including Azad Jammu and Kashmir (AJK) and Gilgit-Baltistan.

Tarar further stated that the government had established a war room and a call center as part of the scheme, ensuring constant monitoring of the situation. The Petroleum Minister addressed the press conference, explaining that efforts were underway to guarantee fuel availability. He had just met with private oil refineries to discuss strategies for ensuring fuel availability in September or October and in case of any issues arising from the Bab al-Mandab. The minister emphasized the importance of being prepared to handle such crises in the future.

Regarding the reduction in the petroleum levy, the minister referred to the relief scheme and explained that the government was taking steps to alleviate the fuel burden, even though fuel was being procured at double the price. Malik mentioned that the prime minister was overseeing work on strategic petroleum reserves and bonded schemes. He further disclosed that the targeted relief cost around Rs25 billion per month, and assured that both the federal government and the Ministry of Finance had given their approval.