Apex court hearing: Rampant corruption in Steel Mills irks SC

Published: March 14, 2012

DEVASTATING DIGITS: 21.83 billion rupees was lost due to corruption (Rs9.99 billion) and mismanagement/ negligence (Rs11.84 billion), of a total loss of Rs26.526b. PHOTO: AFP/FILE

ISLAMABAD: 

Remember the Steel Mills? The Supreme Court certainly does.

The apex court took the Ministry of Production to task on Tuesday for failing to take action against losses worth billions in Pakistan Steel Mills (PSM) – the same institution that the court had stopped from a dubious privatisation deal many years ago in a move which had first brought the current chief justice and judicial activism to the forefront.

PSM has since fallen victim to unprecedented levels of corruption, according to a forensic audit report conducted by an independent audit firm Awais Hyder Liaqat Nouman. The report, provided to the ministry six months ago, revealed that, during fiscal year 2008-2009, losses worth Rs26.526 billion were incurred, according to the PSM counsel, Fakhruddin G Ebrahim. The report also showed a breakup of this loss: Business losses amounted to Rs4.68 billion, losses due to corruption were Rs9.99 billion and losses due to mismanagement and negligence were Rs11.84 billion.

A three member-bench headed by Chief Justice Iftikhar Muhammad Chaudhry strongly admonished accountability agencies and the relevant ministry for their failure to take action.

Ebrahim informed the court that the PSM chairman had been arrested on corruption charges, but never spent a single day in jail – he was admitted to the hospital immediately after his arrest. Justice Tariq Pervez said that corrupt officials were still part and parcel of the steel mills administration. The chief justice said the case would be sent to the National Accountability Bureau (NAB).

However, Justice Khilji Arif Hussain criticised NAB, saying that, while corruption in PSM was common knowledge, NAB had not taken any action against it. Ebrahim informed the court that all of the accused were on interim bail, and no cases were being processed against them for a variety of reasons.

Chief Justice Chaudhry said it was clear that the production ministry, NAB and Federal Investigation Agency (FIA) were all aware of who the corrupt officials are, but refuse to take action against them. Ebrahim blamed the FIA for inaction, pointing out that five inquiries had been initiated by the investigation agency, but no case had been registered so far.

“As per the admission of Production Secretary Gul Muhammad Rind, the forensic audit report was received by his ministry about six months back. We are surprised to note that no steps so far have been taken by the ministry despite the fact that Pakistan Steel Mills is not being run properly,” the court observed in its written order.

The court asked the production secretary why action had not been taken immediately after the ministry received the audit report – his response was that the ministry was contemplating referring all cases and inquiries pending with the FIA to NAB.

The apex court decided to give the ministry of production a chance to mull this decision – but added a strict reminder: “The corruption and mismanagement in leading institutions of the country forced the Supreme Court to intervene to remind the relevant accountability forums of their primary responsibilities,” observed Justice Hussain.

Meanwhile, the chief justice took the opportunity to point out the failure of public sector enterprises across the board. Referring to the audit report, the chief justice lamented that Pakistan International Airlines, Pakistan Railways and Pakistan Steel Mills were “finished” due to corrupt practices, negligence, overstaffing on ‘sifarshi chits’ and the quota system.

“In view of this report, which only pertains to the financial year 2008-2009, it is not known how much loss has been occurred in this organisation (in total),” the chief justice said.

The next hearing will take place on March 15.

Published in The Express Tribune, March 14th, 2012.

Reader Comments (9)

  • Justice
    Mar 14, 2012 - 5:15AM

    No one else but Chief Justice himself is responsible for losses of SC. He is the one who sabotaged the restructuring plan of Steel Mills to get his son inducted in police service.

    How many crooks posing as self styled Massiah’s we have to suffer!

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  • Syed
    Mar 14, 2012 - 6:18AM

    I simply shiver from the thought “how much this govt. would have to answer to Allah ALL Mighty”.

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  • Peer
    Mar 14, 2012 - 6:20AM

    I must say our PPP is the most consistent party in Pakistan. Come Zulfiqar Ali Bhutto of Pakistan economy. So what is different now? Nothing, as always. Solid corruption and shamelessly for that matter in PPP regime again. The same happens in PML N time also. Political appointments should stop.

    Only in Musharraf era it had showed a turn around but we are not honest to give the devil his due. As usual assets are converted to liabilities. The Steel Mill was coming up well but utter bad management due to political appointees has rendered it a loss making unit. Remove all political appointees and those appointed on non-professional basis, bring honest good management it will spring back. I guarantee you that.Recommend

  • Saleem
    Mar 14, 2012 - 6:48AM

    I wonder WHEN Supreme Court will start handing down severe punishment to those who are looting the country? It is time to start putting corrupt officials behind bar and seize all their assets.

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  • Chaudhary Moto Suo
    Mar 14, 2012 - 7:11AM

    @Justice: I agree with you 100%, very well said. Chaudhary Charlatan plays to the gallery.

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  • Balma
    Mar 14, 2012 - 7:33AM

    Government should be making laws – not steel!

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  • JS
    Mar 14, 2012 - 11:25AM

    Does anyone here remember the whole mysterious kidnapping of Riaz Laljee last year…the one where he was picked up close to khi airport and returned 2 days later without a single explanation??? he only took 9billion of the 10billion emergency funds pumped in to PS couple of months ago…but i guess that level of corruption actually makes him the most honest of the current lot of PPP plunderers and corporate raiders….

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  • Cautious
    Mar 14, 2012 - 6:38PM

    @Syed

    I simply shiver from the thought “how
    much this govt. would have to answer
    to Allah ALL Mighty”

    Why wait till then? — your govt is suppose to answer to the Pakistani people — nothing works in Pakistan and it’s time to take a look in the mirror. Rather than sit back and wait for divine intervention why not vote these guys out of office?

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  • Syed
    Mar 14, 2012 - 11:43PM

    @Cautious: your govt is suppose to answer to the Pakistani people – just to end your argument, this govt. is not my representative. Rest, I know my “civil” responsibilities.

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