KARACHI: Finance Division and Ministry of Climate Change are leading reforms which also involve federal ministries/divisions that undertake climate change initiatives. These reforms are aimed at building a more transparent, climate change responsive public financial management system.
These efforts will result in a stronger implementation of the climate policy and more robust tracking of Pakistan’s international commitments.
Climate budgeting seeks to align and scale up the funding of national climate change priorities through the budget process. Increased availability of international climate finance, coupled with mounting evidence of the financial, material and human losses incurred over recent years due to climate-related phenomenon such as more frequent and intensive floods, heat waves, and cyclonic activities rationalize efforts to better translate climate strategies and action plans into budgetary commitments.
Pakistan ranks amongst the top ten countries most vulnerable to climate change. To increase its resilience, the government has taken some critical steps to systematically respond. The 2016 Climate Change Act envisages new governance architecture to coordinate and implement climate policy priorities across levels of government and in 2015 an implementation framework for the 2012 National Climate Change Policy was also adopted.
Under the Paris Agreement on Climate Change, Pakistan has stated its intention to reduce its 2030 projected GHG emissions by up to 20 percent, subject to availability of intemational funding support to help meet the estimated cost of $40 billion at current prices. The Pakistan Nationally Determined Contribution (NDC) under this international agreement also affirmed government’s commitment to intensify efforts for policies and measures to adapt to climate changes.
A Climate Change Financing Framework (CCFF) was launched by the Government of Pakistan in late 2017. This outlines a reforms agenda for mainstreaming climate change in planning, budgeting, and public financial management systems.
Some of the reforms being implemented by the government include operationalising a budget coding and tracking system dedicated to climate expenditures, using data maintained by the Controller General of Accounts (CGA). This system will afford policymakers with more timely and transparent information on budgetary spending at both national and sub-national levels, enabling more informed investment decisions.
It systematizes in real-time information previously obtained through the ‘Climate Public Expenditure and Institutional Review’ (CPEIR) diagnostics carried out in 2015 and again in 2017. The process of tracking provincial climate expenditure and integrating it at federal level has also begun.
The Ministry of Climate Change (MoCC) has shared a proposal for revising the PC-1 template with the Ministry of Planning, Development and Reforms. This will facilitate basic climate change analysis at the project formulation stage. Further, MoCC is supporting the Ministry of Water Resources in formulating climate-responsive Output Based Budget (OBB)/MTBF as a pilot, in line with the CCFF. The approach will be replicated across the federal govemment in later years.
The MoCC also intends to designate focal persons in relevant sector ministries to steer the climate budgeting process and to support broader capacity building to in line ministries to comply with relevant guidelines in the budget call circular.