The Higher Education Commission of Pakistan (HEC) has decided to decrease the non-developmental grants allocated to public universities by 10 percent, while banning the ‘procurement of assets and freezing the appointments of non-teaching staff’.
Referring to the budgetary cuts in the 2019-20 Annual Recurring Grant and other challenges faced, the commission has directed the public universities to employ austerity measures to deal with these budgetary cuts. HEC also suggested the them to seek financial collaboration or cooperation from the provincial governments to manage the current financial crisis.

HEC Chairman Dr Tariq Banuri confirmed the proposal of reduction and said, ”The HEC was already undergoing budget constraints, therefore, it was necessary to further reduce universities’ grants.” According to sources, in a formal letter dispatched to public sector universities, the HEC said that it is passing through a ‘historic reduction in the non-development grant for 2019-20, therefore, slashing public universities’ grant was inevitable. As a result of this reduction, universities are also facing a financial crunch as they have been directed by the government to increase the salaries of government employees.

The letter advised the varsities to cut down their administrative expenses and imposed a ban on procurement of physical resources such as a computer, machinery or other such equipment. They also suggested a temporary ban on hiring new non-teaching administrative staff. The commission also recommended varsities to start a “fund-raising programme” so that industrialists, alumni and other relevant people can donate funds.

The University of Karachi, the largest university of Pakistan in terms of student enrolment has been allocated a grant of Rs1.8 billion, reduced from Rs2 billion, last year. As a result, Karachi University is currently facing a reduction of almost Rs185 million in its non-development grant for the financial year 2019-20, while its annual expenditure is around Rs4.5 billion. The HEC has allocated Rs1.7 billion to the varsity to manage its general budget, while a total of Rs72 million has been set aside for various scholarship programmes. Karachi University spends Rs275 million every month on salaries and pensions and the government-ordered pay and pension hikes will ultimately push yearly pay and pension costs up by Rs200 million, annually.

As for NED University of Engineering and Technology, its grant has been reduced from Rs1.27 billion to Rs1.06 billion. Due to these cuts, NED University is facing a reduction of Rs184 million in its share of grants. The HEC has allocated Rs995.6 million for the university’s general budget while Rs66.64 million has been allocated for scholarship programmes administered.

According to the annual budget presented in the Senate session, the yearly expenses of the varsity in the previous financial year were Rs2.7 billion. According to the sources, the university requires an extra Rs30 million annually to pay the salaries of its teaching and non-teaching staff after the proposed pay hike. As per the budget document, NED will expend more than Rs1.6 billion to pay salaries and allowances to their staff members, with pensions that require additional Rs460 million.

HEC Chairman Banuri added that the commission was very much aware of the financial crunch faced by public sector universities because of government’s decision to raise the salaries of government employees and fluctuating exchange rates. “We are talking with the government for supplementary grants while also negotiating with the education minister, the finance minister and the financial adviser. We are optimistic that there will be a positive outcome from the negotiations,” he added.

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