A looming crisis: NED University faces shortfall of Rs1.4 billion

University syndicate suspends finance director after five-year report.


Noman Ahmed July 20, 2013
In debt of: 665m rupees is the amount the university owes to several banks.

KARACHI:


The NED University of Engineering and Technology finds itself in deep financial crisis as it faces a mammoth shortfall of Rs1.4 billion. This was disclosed in a five-year finance report presented before the Sindh governor’s adviser on higher education, Akhtar Ghori.


Faced with consistent shortfalls in recurring grants and a substantial increase in the number of enrolled students, the university is also nearly double-staffed if the Higher Education Commission guidelines are anything to go by. The combined effect of these factors and financial mismanagement means that the university faces an uphill task of bridging the deficit, which also includes Rs665 million owed to banks against investments.

The report explains that government-announced hike in salaries of public servants coupled with massive hiring of teaching and non-teaching staff by the university in the last five years has led to a crisis-like situation.



The university, run by 1,812 employees in 2007, currently employs 2,385 people while the salary expenditure has seen a steep climb from Rs211 million in 2005-06 to Rs938 million in 2011-12, registering an increase of 344 per cent. To make matters worse, former vice-chancellor late Engr. Abdul Kalam sought the easy way out and acquired loans amounting to Rs1.96 billion instead of taking measures to find a permanent solution. While the university has retired Rs1.3 billion of the borrowed money, it still owes Rs665 million to Habib Metropolitan Bank Limited, National Bank of Pakistan and Askari Bank Limited.

Damage control

The university’s syndicate recently formed a three-member inquiry committee to investigate the matter further and suspended the finance director Muhammad Sajeeruddin.

“We were heading towards a total disaster,” NED vice-chancellor, Prof. Dr Afzalul Haque, told The Express Tribune, adding that while there is no clause in the university act that bars the institution from taking loans, making this practice a permanent feature has many ramifications. “At a time when the university was being overburdened with unnecessary appointments of teaching and non-teaching staff, we need to ascertain who came up with such a suggestion.”



Talking about suspension of the finance director, Dr Haque said that it was done as per rules and regulations of the university. The committee has been tasked to find out whether Sajeeruddin was responsible for mismanagement or was he only following orders from the higher-ups. “There is no charge of embezzling funds against him but he can be held accountable for his incompetency in managing the university’s affairs,” the vice chancellor clarified.

The university has also decided to put a stop to the practice of taking loans and ban recruitment for at least a year.

The step, however, hasn’t gone down well with several university officials. “Targeting the finance director alone will not help,” said a senior administration official. “He couldn’t have possibly done anything without instructions from the vice-chancellor and the pro-vice chancellor.”

Published in The Express Tribune, June 21st, 2013.

COMMENTS (1)

Nadeem Usmani | 7 years ago | Reply

It is very sad that NED university passing through such a financial crises.Most of the problem this university faces is owe much from the political interference it undergoes from various sectors including high up sindh official and political parties.To make the finance director scape goat is not the solution.

University syndicate and VC has to stand up against these interference like of pressure of hiring the new staff on high salaries and of low qualification.They have to manage their own finance.

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