Parliament and profit: Who will watch the watchmen?

A senator accused of gaining from cut-rate deals at Lok Virsa happens to be on the committee

ISLAMABAD:

A tiff between the management of Lok Virsa and a private production company has put the country’s premier cultural organisation in dire financial straits.

The controversy surfaced after the management of the National Institute of Folk and Traditional Heritage, popularly known Lok Virsa, as refused to extend several contracts of the Cosmos Productions and also echoed in the parliament.



A senator from the opposition Pakistan People’s Party (PPP) has allegedly been abusing her position to protect her business interests.

The controversy traces back to 2004, when Lok Virsa outsourced almost all its functions – from sale of entry tickets to the operation of tuck shops, cafeterias, a production house, craft bazaar, heritage museum, open air theatre, and cultural events – to the private company in addition to a sizable chunk of valuable land for establishment of extra facilities.

All of these functions were given to the firm under a one-sided umbrella agreement, followed by another 15 sub-contracts, in violation of rules and without getting approval from the Virsa board of governors.

“Almost every inch of Lok Virsa and its facilities were given up for peanuts under an agreement clearly favouring the private firm,” said a senior official who asked not to be named.

According to documents available with The Express Tribune, the contracts signed in 2004 were valid for five years, and renewed in 2008 for another five years without fulfilling the rules and formalities.

In 2012, the Auditor General of Pakistan (AGP) pointed out several violations of public procurement rules and illegal favours given to the production firm.

Several audit objections were raised but remained unresolved.

In 2014, the Lok Virsa management decided not to extend the agreements as well as to take back land and other facilities from Cosmos.

But the management found it could not take back two prime facilities — the Virsa Café and the National Institute of Cultural Studies (NICS).

The café spreads over 4,159 square feet, was rented out for just Rs31,250 per month.



The contract expires in 2018.

The institute covers 27,200 square feet and the lease agreement expires in 2035.

Under the agreements, Cosmos was bound to share profits earned from the facilities with Lok Virsa, but the firm’s books show these operations as making a loss.

Cosmos was owned by noted writer and TV artist Rauf Khalid, who died in  a road accident in 2011.

Khalid was known to be very close to then Lok Virsa Executive Director Uxi Mufti and then President Pervez Musharraf.

Khalid’s wife, PPP Senator Rubina Khalid, became head of the company after his death.

Honour among senators?

Due to the recurrence of the same audit objections by the AGP and repeated calls for action by the Public Accounts Committee (PAC), the incumbent Lok Virsa management began to streamline the affairs of the organisation.

In January 2016, after issuing multiple warnings, the management got some rooms vacated, which were illegally constructed by Cosmos next to the cafeteria.

The action against a senator’s business interests landed the Lok Virsa management in trouble.

On January 19, an FIR was registered against Lok Virsa Executive Director Dr Fouzia Saeed, two directors, and other staffers on the complaint of Arif Mehmood of Cosmos, for ‘stealing money and other valuables’ from the illegal structures.

Meanwhile, the Senate Standing Committee on Information and National Heritage also shifted its focus to Lok Virsa’s issues. Incidentally, Senator Khalid is a member of the committee.

In its last meeting in April, the committee accused Dr Saeed of freezing pensions of a number of retired employees.

The pension freeze accusation came at a time when Virsa faced a financial crunch, in part due to the non-payment of Rs12.5 million by Cosmos under profit sharing and rent.

The Senate panel has now sought records related to the appointment of Dr Saeed, domestic and foreign trips she has made, and reviews of her performance since February 2015 when she took charge as ED.

Senator Khalid, while talking to The Express Tribune, said that Cosmos had valid agreements for using Lok Virsa facilities.

“The agreements were signed in 2004-2005. PPP was not in power at that time,” she said, adding that that should be enough to rebuff the impression that political influence was a factor in approval of the contracts.



When asked about a possible conflict of interest as she is on a Senate panel discussing the affairs of Lok Virsa, the senator said she had resigned from Cosmos a while ago.

Conversely, the Cosmos website still lists her home address in Islamabad — available on the Senate website — as its office address.

Messy affairs

Dr Saeed while explaining her position, said she inherited a plethora of issues when she assumed her office last year.

In 2014, she said, the PAC took up the dubious contracts and directed the Lok Virsa management to take action at the earliest which was also endorsed by the Lok Virsa Board.

“I took steps to streamline affairs and evict illegal occupants in light of the directions of the PAC and the board,” she said, adding that the FIR against her and other staffers had been registered after she tried to challenge the status quo and prevailing unfair practices.

She said that before taking action, she communicated the senator who owns the firms verbally and in writing a number of times, but the senator did not bother to pay attention.

“I have respect for the senators, but I see a possible conflict of interest as a senator whose firm (Cosmos) owes us about Rs12.5 million and is currently doing business here is reviewing the performance of the Lok Virsa,” she said, adding that the practice was unethical and unacceptable.

Responding to a question, Dr Saeed said, she would appear before the Senate panel in its next meeting and present the department’s overall performance.

“I want to resolve longstanding issues and restore the dignity of the Lok Virsa,” she added.

Dr Saeed said the FIR registered against her was based on false accusations, adding she would soon initiate the process of quashing the case.

Published in The Express Tribune, May 6^th, 2016.