Settling audit objections: PAC glosses over irregularities in Neelum-Jhelum project
The objections pertain to the PPP government’s third financial year 2010-11.
The objections pertain to the PPP government’s third financial year 2010-11. PHOTO: MARIAM ESSA
ISLAMABAD:
Despite irrefutable proof, the Public Accounts Committee (PAC) on Tuesday condoned about Rs6 billion irregularities in the Neelum-Jhelum hydropower project (NJHPP) – the scheme funded by imposing a tax on every electricity consumer and obtaining expensive foreign loans.
The National Assembly’s accountability arm, led by Pakistan Peoples Party’s (PPP) Khursheed Shah, seems to be falling short of expectations after it settled the audit objections pertaining to the PPP government’s third financial year, 2010-11.
The audit objections were related to the award of a contract for civil works at higher than bid prices, procurement of luxury vehicles in the name of the project, paying irregular insurance claims and escalation on performance guarantees to contractors.
Political pundits had earlier expressed concern that the PAC may not be able to take impartial decisions on the audit objections pertaining to the years when the PPP was at the helm of affairs.
The Neelum-Jhelum project has been initiated to generate 969megawatts of electricity. The project is under construction and its cost has already escalated to Rs320 billion, from a low of Rs84 billion, mainly because of change in project design and alleged kickbacks.
The federal government is charging 10 paisa per unit Neelum Jhelum surcharge on every unit consumed from every user. It has also arranged over $1 billion in expensive loans from China, Saudi Arabia and the Islamic Development Bank for the project.
According to Director General Audit of Water and Power Development Authority (Wapda), a Chinese company quoted the lowest bid price of Rs87.5 billion for main civil works. But the project was awarded at Rs92.6 billion.
The contractor quoted the prices of each component only in figures instead of the requirements of writing both in figures and words to avoid tampering. “The issue points towards transparency in the award of contracts,” said the director general audit.
Published in The Express Tribune, March 26th, 2014.
Despite irrefutable proof, the Public Accounts Committee (PAC) on Tuesday condoned about Rs6 billion irregularities in the Neelum-Jhelum hydropower project (NJHPP) – the scheme funded by imposing a tax on every electricity consumer and obtaining expensive foreign loans.
The National Assembly’s accountability arm, led by Pakistan Peoples Party’s (PPP) Khursheed Shah, seems to be falling short of expectations after it settled the audit objections pertaining to the PPP government’s third financial year, 2010-11.
The audit objections were related to the award of a contract for civil works at higher than bid prices, procurement of luxury vehicles in the name of the project, paying irregular insurance claims and escalation on performance guarantees to contractors.
Political pundits had earlier expressed concern that the PAC may not be able to take impartial decisions on the audit objections pertaining to the years when the PPP was at the helm of affairs.
The Neelum-Jhelum project has been initiated to generate 969megawatts of electricity. The project is under construction and its cost has already escalated to Rs320 billion, from a low of Rs84 billion, mainly because of change in project design and alleged kickbacks.
The federal government is charging 10 paisa per unit Neelum Jhelum surcharge on every unit consumed from every user. It has also arranged over $1 billion in expensive loans from China, Saudi Arabia and the Islamic Development Bank for the project.
According to Director General Audit of Water and Power Development Authority (Wapda), a Chinese company quoted the lowest bid price of Rs87.5 billion for main civil works. But the project was awarded at Rs92.6 billion.
The contractor quoted the prices of each component only in figures instead of the requirements of writing both in figures and words to avoid tampering. “The issue points towards transparency in the award of contracts,” said the director general audit.
Published in The Express Tribune, March 26th, 2014.