Dubious deals: Punjab govt averse to prosecute fraud-tainted officials
Fifteen senior officials allegedly caused losses of over Rs15m .
LAHORE:
The Punjab government is reluctant to initiate proceedings against 15 senior officials who allegedly committed fraud, irregularities and corruption worth Rs15 million in the procurement of machinery and equipment for the Punjab Small Industries Corporation (PSIC) which began in October, 2010, The Express Tribune has learnt.
In addition to the losses suffered by PSIC, the accused officials also purchased substandard and refurbished machinery worth above Rs250 million for eight cluster development centres (CDC) that have yet to become fully functional as the machinery is not in working condition, an official requesting anonymity said. In total, the officials caused losses of over Rs275 million to the national exchequer through questionable deals, the official added.
The accused include two senior District Management Group (DMG) officers, 12 senior PSIC officials and a professor of the University of Engineering and Technology (UET), The Express Tribune learnt.
In 2005, under the guidance of the Punjab government, PSIC prepared a comprehensive plan for the procurement of emerging technologies to facilitate industrial clusters and enhance quality output in the province. The plan was overseen by the United Nations Industrial Development Organisation and Small and Medium Enterprises Development Authority.
The finalised plan for CDCs included: Auto parts support centre, designing of tools, dies and testing facilities in Lahore, centre for sports goods industry, business support centre for electrical fitting in Sargodha, wooden furniture service centre in Chiniot, light engineering industries in Faisalabad, metallurgy, casting and agricultural implements in Daska, light engineering industries as well as a handloom CDC in Multan.
The Planning Cycle (PC-I) prepared by PICS was approved by the planning and development board under the Annual Development Programme during the fiscal year 2005-2007. The corporation constituted various technical committees for the purchase of machinery to ensure that the CDCs are operational within the stipulated period, the official said.
It was at this stage of procurement that the committees made purchases in the millions of substandard machinery on higher rates after taking kickbacks. Some vendors were even paid in advance without the approval of the competent authority and adherence to the given structural procedures.
In September 2010, the managing director of PSIC detected foul play on part of the committee members, the former MD and the industries secretary in the procurement of machinery, which had caused huge losses to the national exchequer.
Consequently, the managing director constituted a four-member committee headed by himself to probe the issue.
In October 2010, the committee observed that the technical committees grossly violated mandatory procurement procedures and even disbursed a majority of payments in advance to suppliers. Furthermore, there was no competitive bidding between vendors to ensure that the suppliers were selected by the technical committees themselves.
The technical committees procured machinery at above the market rates and even purchased refurbished equipment without meeting the specifications outlined in PC-1. The probe committee accused 15 officials of causing losses of over Rs15 million to the national exchequer.
The officials were also accused of not being able to make the CDCs functional after a lapse of five years.
PSIC MD Farhan Aziz Khawaja said the fact-finding report would be tabled before a board headed by the minister for industries, commerce and investment to take a final decision on the issue. The accused officials have also been served letters to clarity their positions and defend themselves.
The report along with the clarification letters of the accused would be tabled again before the board, Khawaja maintained. The board would then decide whether to initiate legal, departmental or criminal proceedings against the accused, said Khawaja.
Published in The Express Tribune, October 14th, 2011.
The Punjab government is reluctant to initiate proceedings against 15 senior officials who allegedly committed fraud, irregularities and corruption worth Rs15 million in the procurement of machinery and equipment for the Punjab Small Industries Corporation (PSIC) which began in October, 2010, The Express Tribune has learnt.
In addition to the losses suffered by PSIC, the accused officials also purchased substandard and refurbished machinery worth above Rs250 million for eight cluster development centres (CDC) that have yet to become fully functional as the machinery is not in working condition, an official requesting anonymity said. In total, the officials caused losses of over Rs275 million to the national exchequer through questionable deals, the official added.
The accused include two senior District Management Group (DMG) officers, 12 senior PSIC officials and a professor of the University of Engineering and Technology (UET), The Express Tribune learnt.
In 2005, under the guidance of the Punjab government, PSIC prepared a comprehensive plan for the procurement of emerging technologies to facilitate industrial clusters and enhance quality output in the province. The plan was overseen by the United Nations Industrial Development Organisation and Small and Medium Enterprises Development Authority.
The finalised plan for CDCs included: Auto parts support centre, designing of tools, dies and testing facilities in Lahore, centre for sports goods industry, business support centre for electrical fitting in Sargodha, wooden furniture service centre in Chiniot, light engineering industries in Faisalabad, metallurgy, casting and agricultural implements in Daska, light engineering industries as well as a handloom CDC in Multan.
The Planning Cycle (PC-I) prepared by PICS was approved by the planning and development board under the Annual Development Programme during the fiscal year 2005-2007. The corporation constituted various technical committees for the purchase of machinery to ensure that the CDCs are operational within the stipulated period, the official said.
It was at this stage of procurement that the committees made purchases in the millions of substandard machinery on higher rates after taking kickbacks. Some vendors were even paid in advance without the approval of the competent authority and adherence to the given structural procedures.
In September 2010, the managing director of PSIC detected foul play on part of the committee members, the former MD and the industries secretary in the procurement of machinery, which had caused huge losses to the national exchequer.
Consequently, the managing director constituted a four-member committee headed by himself to probe the issue.
In October 2010, the committee observed that the technical committees grossly violated mandatory procurement procedures and even disbursed a majority of payments in advance to suppliers. Furthermore, there was no competitive bidding between vendors to ensure that the suppliers were selected by the technical committees themselves.
The technical committees procured machinery at above the market rates and even purchased refurbished equipment without meeting the specifications outlined in PC-1. The probe committee accused 15 officials of causing losses of over Rs15 million to the national exchequer.
The officials were also accused of not being able to make the CDCs functional after a lapse of five years.
PSIC MD Farhan Aziz Khawaja said the fact-finding report would be tabled before a board headed by the minister for industries, commerce and investment to take a final decision on the issue. The accused officials have also been served letters to clarity their positions and defend themselves.
The report along with the clarification letters of the accused would be tabled again before the board, Khawaja maintained. The board would then decide whether to initiate legal, departmental or criminal proceedings against the accused, said Khawaja.
Published in The Express Tribune, October 14th, 2011.