Govt to maintain treasury single account

Aftab Ahmed

Islamabad: As the country is cash-starved following the Covid-19 pandemic, the government has decided to put cash of all ministries, divisions and public sector companies in a treasury Single Account to ensure availability of cash when it is required.

The Finance Division has framed Treasury Single Account (TSA) Rules 2020 in this regard.

The fundamental principles and objectives of the rules are to anticipate the cash needs of the government, maintain a cash balance in the government accounts effectively, and ensure the availability of cash when it is required. It will also ensure institutional and administrative arrangements to manage an effective cash management system including placement of all public money into treasury single account.

According to the provision of section 30 of the act, the finance division shall with the approval of the federal government notify rules to prescribe the effective cash management system for all public entities and special purpose funds leading to the treasury single account.

Under section 22 of the Public Finance Management Act 2019, the operation of the federal consolidate fund and the public account of the federation vests with the Finance Division under the overall supervision of the federal government.

Section 31 of the act provides that the federal consolidate fund shall be maintained in the State Bank of Pakistan and any such other bank accounts may be opened as requested by the finance division from time to time according to the SBP act 1956.

In compliance with section 30 of the PFM act 2019, the finance division has framed cash management and treasury single account rules 2020 in consultation with stakeholders. The fundamental principles and objectives of the rules are to anticipate the cash needs of the government, maintain a cash balance in the government accounts effectively, and ensure the availability of cash when it is required.

Moreover, rules provide for institutional and administrative arrangements to manage an effective cash management system including placement of all public money into treasury single account.

The cash management and the Treasury Single Account (TSA) Rules 2020 will extend to the government offices, ministries, divisions, executive departments including subordinate offices.

The finance division will frame separate rules for autonomous regulatory bodies or other bodies directly or directly controlled by the federal government at large.