The federal government has decided to extend austerity measures for FY27, continuing a series of spending restrictions aimed at reducing public expenditure and strengthening fiscal discipline.

Sources said the federal cabinet has approved the continuation of the cost-cutting policy, and the Cabinet Division has forwarded the decision to the Ministry of Finance for implementation.

As part of the measures, all federal government positions that have remained vacant for the past three years will be permanently abolished. The government will also maintain its ban on creating new posts during the current fiscal year.

The restrictions further prohibit the purchase of official vehicles by federal departments throughout FY27. The existing ban on procuring machinery and equipment will also remain in effect.

In addition, government-funded overseas medical treatment and non-essential foreign travel by public officials will continue to face restrictions.

The Ministry of Finance is expected to issue a formal notification in the coming days detailing the extended austerity measures.

The decision is part of the government’s broader fiscal consolidation strategy to curb expenditures, improve budget management, and meet its economic reform commitments amid continued pressure on public finances.