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Pakistan cabinet resigns in cost-cutting move

Pakistan’s cabinet resigned Wednesday to allow Prime Minister Yousaf Raza Gillani to name a smaller group, a cost-cutting move that follows pressure from opposition parties and international lenders.

Gillani, who heads a weak coalition government, is expected to announce a new cabinet within days. Aides said it is likely to be about half the size of the current group, which includes more than 60 ministers and members of ministerial rank. The holders of key cabinet positions, such as the foreign, finance and interior ministers , are expected to keep their jobs.

The shrinkage is required under a constitutional amendment passed last year, which devolved several ministries to the provincial level. But the move also comes against the backdrop of a widening fiscal deficit that has prompted the International Monetary Fund to withhold the final tranche of an $11 billion loan to pressure Pakistan to adopt economic reforms, including an expanded sales tax.

To pass those measures, the ruling Pakistan People’s Party needs the support of opposition parties, which had singled out the large cabinet as an emblem of government waste and cronyism.

“This would save money. It would give a good message to the people of Pakistan,” said Farahnaz Ispahani, a spokeswoman for President Asif Ali Zardari, referring to the smaller cabinet. Cabinet members, she said, “got houses, they got cars, they got ministries. They got all kinds of things paid for.”

As money-saving measures go, Wednesday’s move appeared to be largely symbolic. Government officials said they did not know how much it would save, NEW: though Farhatullah Babar, a government spokesman, said one minister costs the state about $71,000 a year.END NEW State coffers were also diminished by devastating flooding last summer. Economists say the main cause of Pakistan’s economic woes is a broad failure to collect taxes.

It was also unclear whether the measure would satisfy the main opposition party, led by former prime minister Nawaz Sharif. Last month, as disputes among the ruling coalition threatened the government’s survival, Sharif gave the government six weeks to implement a 10-point reform agenda compiled by his party, a timeline Gillani accepted.

The agenda included the ouster of “corrupt ministers,” as well as several goals analysts deemed impossible to achieve in the short term, such as “ensuring security of the country.”


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