Dissent emerges over SECP's lavish pay hike

Despite claims of unanimity, commerce secretary was absent and private member opposed salary rise

ISLAMABAD:

The Securities and Exchange Commission of Pakistan's (SECP) Policy Board decision to approve a massive salary and perks revision worth Rs226 million was not unanimous, with at least one member objecting to the unequal increases, sources confirmed.

During the November 2024 meeting, which approved a backdated revision effective July 1, 2023, private sector member Shagufta Shamsuddin Hassan raised objections and proposed a uniform 15% increase across the board. However, the SECP working paper suggested higher raises for senior executives, including executive directors, and smaller increments for joint directors and junior officers, fuelling resentment within the organisation.

Despite these objections, the board cleared the summary with minimum quorum. The secretary commerce did not attend and was represented by an additional secretary, raising concerns over the approval process.

The matter escalated after the Auditor General of Pakistan (AGP), in its annual report, flagged extraordinary allowances — Rs226 million in salary and perks revisions and Rs111 million under "rest and recreation" heads. The issue has now landed before the Public Accounts Committee (PAC) and the Senate Standing Committee on Finance and Revenue.

Amid media criticism of perks granted to commissioners and the chairman, the SECP dispatched a team to Karachi to meet Hassan and address her concerns. The team reportedly spent three days attempting to persuade her not to escalate the issue further.

Legal experts have also questioned whether the Policy Board holds the authority to revise the pay of the chairman and commissioners, who are appointed by the federal government through the Establishment or Finance Divisions, and not SECP employees.

The controversy has placed the regulator under scrutiny, with lawmakers demanding explanations on both the legality and fairness of the unprecedented pay hike.

When contacted, an SECP spokesperson said the Policy Board's approval of pay revisions was unanimous.

"A uniform formula, based on a market survey conducted by an independent third party, was applied regardless of seniority (ie, actual salary vis a vis benchmarked percentile of the market)," the spokesperson said. "The benchmarked percentile of the market for senior positions was lower compared to junior positions."