ISLAMABAD: The government on Thursday faced humiliation as a Senate panel blocked its move to get a hotchpotch bill passed, which the panel observed was aimed at usurping some of the authority of the Parliament besides giving discretionary powers to the central bank.
Headed by Senator Saleem Mandviwalla, the Senate Standing Committee on Finance returned the Credit Information Bureau (CIB) Bill to the government and recorded serious objections over the motive of the Bill.
The delay in approval of the Bill may also create problems for the government, as the approval of the CIB Bill from the Parliament is one of the conditions for a $400-million loan of the World Bank.
It was for the second time the government had to face humiliation at the hands of the parliamentarians on the same piece of legislation. Earlier, the National Assembly Standing Committee on Finance had thrice rejected the draft of the Bill after finding “glaring flaws” in the drafting before approving it in the fourth sitting.
The Senate standing committee meeting will be held next month in which it will insert its amendments in the government-drafted bill. After the Senate panel’s refusal to pass the Bill in its present form, the CIB Bill will now again go back to the National Assembly to consider the amendments incorporated by the upper chamber of the Parliament.
The top echelons of Ministry of Finance and the State Bank of Pakistan skipped Thursday’s meeting, highlighting their lack of respect for parliamentary business. A director level official of the SBP and an additional secretary of Ministry of Finance tried to defend the proposed draft.
The Bill is very vague and if passed in the present form will create many complications for the business, said Senator Talha Mehmood of JUI. The committee had concerns over a proposed clause that authorizes the federal government indefinitely delay enforcement of any part of the proposed law. This clause tantamount to delegating Parliament’s powers to the federal government, said Senator Saleem Mandviwalla.
The members had also objections over the definition of the credit information. The definition not only covers loans and guarantees but also retail transactions, dues of insurance companies, bills of utility companies including electricity and gas, and house rent.
According to this definition, if a person has defaulted on his home rent and utility bill, he is not eligible to obtain a loan from any financial institution. Since the defaulters cannot contest elections, the senators were of the view that this will become a hurdle for them at the time of elections.
They wanted that the CIB be limited to the extent of financial sector borrowings, as getting a clearance certificate from a property owner will be asking for too much.
“Giving such sensitive information in private hands would be like establishing wiki leaks that will comprise privacy and secrecy of the borrowers,” said Senator Mehmood.
“The level of confidentiality that is available to borrowers under the Banking Companies Ordinance is missing from the proposed CIB Bill”, said Mehmood Mandviwalla - a corporate lawyer and a partner at Mandviwalla and Zafar Associates. He also endorsed the committee’s concerns regarding giving the powers of determining minimum paid-up capital to SBP.
Published in The Express Tribune, June 26th, 2015.
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