ISLAMABAD: The Auditor General of Pakistan (AGP) has unearthed misuse of public funds to the tune of billions in the accounts of Water and Power Development Authority (WAPDA), and the Ministry of Water Resources for the audit year 2017-18, it has been learnt reliably.
An available copy of audit report on the accounts of WAPDA and the Ministry of Water Resources for the audit year 2017-18 with Pakistan Today reveals that the AGP has discovered irregularities in the accounts of WAPDA and the water resources ministry.
Key audit findings of the report include 39 cases pertaining to recoveries/overpayments representing cases of established overpayment/misappropriation of public money amounting to Rs76,177.59 million. The report uncovered 41 cases of unjustified expenditures amounting to Rs66,420.64 million, 65 cases of irregularities/violation of rules amounting to Rs27,789.85 million, 36 cases pertaining to other funds payments etc. amounting to Rs25,261.84 million, 5 cases of misuse of public funds amounting to Rs12,247.55 million, while 6 cases pertaining to weaknesses of internal control systems amounting to Rs2,771.85 million and one case pertaining to accident/damage amounting to Rs1,042 million.
However, audit para for the audit year 2017-18 involving procedural violations and internal controls weaknesses not considered significant enough to report to the Parliament, and thus has been included in the (MFDAC) report, said the AGP report.
The AGP has also given recommendations in the audit report on the accounts of WAPDA and the Ministry of Water Resources for the audit year 2017-18. According to report, the management needs to make expeditious efforts for recovery of outstanding/overpaid amounts while the management needs to be vigilant when incurring expenditure for reducing administrative and operational costs.
Non-recovery of medical share from corporate entities/WAPDA formations – Rs1, 608.61 million
In the office of DG Medical Services WAPDA/MS WAPDA Hospital, Lahore, the medical share of Rs1,608.61 million on account of medical facilities was recoverable from various corporate entities/WAPDA formations up to the FY2016-17.
According to clause 9.6 of the SOP for WAPDA Medical Services, funds shall be transferred on a monthly basis in the medical share collection accounts of DG (Medical Services), WAPDA, Lahore by all the offices of residual WAPDA and other corporate entities availing medical facilities from the office of the Director General (Medical Services) in accordance with uniform rates of service per employee.
The matter was taken up with the management in November, 2017 and reported to the Ministry in January, 2018. The management replied that an amount of Rs446.75 million had been recovered and efforts were being made to recover the remaining amount.
The local DAC in its meeting held on January 29-30, 2018 directed the management to provide recovery record within 15 days and expedite the pending recovery. Further progress was not reported till the finalisation of report. “Audit recommends that the management needs to implement local DACs directives besides fixing responsibility, “said AGP report.
Unjustified payment of bonus to WAPDA employees – Rs 576.26 million
In Directorate General (B&C) WAPDA Lahore, an amount of Rs576.26 million was paid to the employees as bonus in the light of decisions taken in authority’s meeting held on September 03, 2016. The payment of bonus was not justified as the authority was facing a deficit of Rs789 million in overheads and excessive expenditure of supervisory offices of the Water Wing. Moreover, the DG (B&C) objected the grant of bonus hinting that it would create an additional financial burden.
According to FR-46-B of Combined Set of F.R & S.R,” a competent authority may grant or permit a government servant to receive an honorarium as remuneration for work performed which is occasional in character and either so laborious or of such special merit as to justify a special reward.” Moreover, as per bonus policy circulated by the Ministry of Finance on March 18, the bonus would be paid to the employees of autonomous/semi-autonomous/public sector corporations/organisations on the operational profit only excluding income from the sources.”
“Violation of bonus policy of the Government of Pakistan resulted in un-justified payment on account of bonus of Rs576.26 million to employees up to the FY 2016-17,” said the AGP report.
The report added that the matter was taken up with the management in November, 2017 and reported to the Ministry in January, 2018. The management replied that bonus was paid to employees with the approval of competent authority.
Similarly, the local DAC in its meeting held on January, 29-30, 2018 directed the management to provide rules/policies where bonus could be paid without considering operational profit otherwise, the matter be referred to Finance Division for obtaining concurrence. Further progress was not reported till finalisation of report. And, audit recommended that the management needs to implement local DACs directives besides ensuring recovery from employees.
Non-adjustment of advances – Rs112.45 million
In the office of DG Medical Services WAPDA/MS WAPDA Hospital, advances of Rs112.45 million were granted to different supplies/contractors/consultants/employees. These advances were required to be adjusted upon completion of activity which was not done.
Non-adherence to WAPDA Accounting and Financial Reporting Manual resulted in no-adjustment of advances of Rs112.45 million granted to suppliers/contractors/consultants/employees up to the FY 2016-17.
According to section 9.2.3 and 9.2.6 of WAPDA Accounting and Financial Reporting Manual, the advances should be for WAPDA related business and unused advance shall be returned to WAPDA immediately after the activities and unused advances shall be returned to WAPDA immediately after the activity completion. Advances made to outside parties shall be adjusted against the running bills as per terms and conditions of the agreement/contract, said the AGP.
The audit report further pointed out that the matter was taken up with the management in November, 2017 and reported to the Ministry in January, 2018. The management replied that an amount of Rs100 million had been adjusted and efforts were underway to clear the balance and advances.
The local DAC in its meeting held on January 29-30, 2018 directed the management to produce the record of recovery/adjustment made and expedite the balance recovery/adjustment to audit within one week. Further progress was not reported till the finalisation of the report. And, the audit recommended that the management needs to implement local DACs directives besides fixing responsibility.
Irregular procurement of medicines under rate contracts in violation of PPRA rules – Rs102.72 million
In the office of DG Medical Services WAPDA/MS WAPDA Hospital Lahore, different medicines valuing Rs102.72 million were purchased under original as well as extended rate contract. The award of purchase orders under rate contracts without competitive bidding was irregular.
Non-adherence to PPRA rules resulted in irregular procurement of medicines valuing Rs102.72 million under rate contracts up to FY2016-17.
According to Rule-20 of Public Procurement Rules, 2004, “ save as otherwise provided, the procuring agencies shall use open competitive bidding as the principal method of procurement for the procurement of good, services and works. As per Rule-42 (iv), repeat orders should not be more than fifteen (15 per cent) of the original procurement.
The matter was taken up with management in November, 2017 and reported to the Ministry in January, 2018. The management replied that the rate contracts for procurement of medicines were executed after observing the PPRA rules. Open competitive bidding, the process was adopted to execute the rate contracts, said the AGP in its audit report.