The annual audit report reveals that almost Rs200 billion of taxpayers’ money has apparently been squandered by the government through various irregularities and mismanagement in the top ten state-run enterprises during the last fiscal year.
The Water and Power Development Authority (Wapda) was at the top of the list, with a whopping Rs180 billion worth of losses taking place in the authority alone.
Wapda accounts showed that undue favour had been given to Independent Power Projects at a public cost worth Rs40.7 billion. Departments did not follow rules and regulations as prescribed by law, according to the auditors.
In addition, the authority lost Rs15 billion due to excess consumption of fuel, over and above the standard fixed by the National Electric Power Regulatory Authority (Nepra). This wasn’t the only Nepra target it was unable to meet. Wapda lost Rs13.4 billion due to energy losses that exceeded the target set by the regulatory body. An additional burden on the public exchequer because of inefficient Wapda policies amounted to Rs31.5 billion.
The mismanagement does not end here. Rs9.5 billion were lost due to an abnormally high provision of interest during certain construction projects under PC-I (The initial proposal of a project usually prepared by the Planning Commission).
Meanwhile, Wapda wasn’t the only state institution with its inefficiencies revealed. The auditor general’s report also showed irregularities worth Rs5 billion in Pakistan Steel Mills’ accounts. Rs2.8 billion were apparently lost due to the sale of various steel products at extremely low prices. In addition, Rs1.813 billion were lost due to excess lifting of consignments by both dealers and consumers.
Another public enterprise – Pakistan Agriculture Storage and Services Corporation – has lost Rs11.2 billion due to the procurement and sale of substandard rice. The auditors also found irregularities worth Rs91 million in the accounts of the National Insurance Company Limited (NICL). They pointed out irregular recruitments by the Human Resources Department which did not follow qualification criteria, causing losses worth Rs32 million. Another Rs11 million were spent on the security for the office and the chairman of NICL alone.
In Trading Corporation Pakistan, irregularities worth Rs2.4 billion were pointed out. These losses were due to a shortage of sugar, irregular payments to transporters, and a shortage of wheat.
Wah Industries Limited also met losses worth Rs1.4 billion due to the procurement of imported materials, the sale of civil products worth Rs370.928 million, irregular expenditure on foreign visits which cost Rs5.244 million and the award of construction projects which cost Rs1.402 million. All projects, according to the audit report, were carried out in a non-transparent manner.
The non-recovery of rent for the National Development Complex cost Rs23.711 million to the national exchequer, observed the auditors.
The Ministry of Defence also lost Rs1.6 billion due to premature re-payment of loans and other irregularities in various departments. Similarly, the Oil and Gas Development Authority met losses of Rs2.1 billion due to the abandonment/suspension of a well that was being drilled amongst other reasons.
The National Logistic Cell, meanwhile, is marred by financial irregularities worth Rs1.65 billion in various departments, stated the auditor report.
The report stated that the respective government departments were asked to submit replies to explain the losses. Till the filing of this report, no government department had filed any reply.
Published In The Express Tribune, June 17th, 2012.
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