Eight sacked SME Bank officials reinstated: PAC expresses reservation

The Public Accounts Committee (PAC) expressed displeasure over reinstatement of eight SME Bank officials, who were sacked on the charges of financial irregularities in 2005, by the then Secretary Finance Naveed Ahsan. The PAC asked the Secretary Finance Dr Waqar Masood, how a person namely Ehsanul Haq along with other seven officials of the SME Bank, who were found guilty was exonerated by Secretary Finance and later appointed President of the same bank after six years.
"Why such controversial person has been appointed as president of SME Bank," Chaudhry Nisar Ali Khan, Chairman PAC questioned the Secretary Finance, during the PAC meeting held at Parliament House on Thursday. Secretary Finance responding to query from Chairman PAC stated that the Secretary Finance is the appellate authority to hear such cases and decide the cases.
Nisar Ali directed the Ministry of Finance to provide details of inquiry conducted against the eight officials of the SME bank including the sitting president and the details of the order of exoneration by Secretary Finance. The PAC was informed by audit authorities that the SME Bank imposed penalties of removal/compulsory retirement from service on eight officials of the Bank on the allegation of irregular treasury transactions due to which, the bank incurred heavy losses.
The audit authorities also revealed that the Board of Directors and State Bank of Pakistan (SBP) also highlighted the irregularities on the part of the officials but the Secretary Finance, however, reinstated the officials with full back benefits. Chaudhry Nisar took serious note of the matter and directed the concerned department to issue notices to all officials who found guilty in financial irregularities in the SME Bank and ensure recovery of the embezzled money.
The representative of the SME Bank Ehsanul Haq informed the PAC that the charges against the officials were not proved and they were exonerated. Chaudhry Nisar posed question about the authority that had reinstated the officials and expressed doubts that how the officials were reinstated after six years. He directed the Ministry of Finance to submit details of the case before the PAC within three days.
Taking up the audit paras of the Industrial Development Bank of Pakistan (IDBP), directed the Secretary Finance Dr Waqar Masood to furnish lists of names of persons who are on board of directors of those industrial firms who obtained heavy loans from the bank and were yet to return those.
Those industrial units also include Marhaba Textile Mills Limited who obtained Rs 224.3 million as loans during 1991-1993 while only Rs 74.5 were recovered. Similarly, Rs 712.2 million is outstanding against Hala Spinning Limited, Rs 137 million against Delta Tyres and Rubber Company, Rs 84 against Mohib Export Limited and Rs 26 million against Imperial Pipe Industries.
Taking up the Audit paras of the Fata, the PAC also reprimanded Secretary Fata because of his absence in the committee meeting to no response to audit objection related to Fata Secretariat. Reviewing the Fata Secretariat grant related para, the absence of Secretary Fata was noticed in the meeting. The meeting was informed that he had to attend some other official meeting.
Chairman PAC had sent a message in Secretary FATA office to immediately come and attend the meeting who after half an hour reached the committee meeting and apologised for his non-presence. "Lame excuse will not work. You do not posses much important post than Secretary Defence or Secretary Finance as you have to be here by 10 am," Chaudhry Nisar said. Auditor authorities informed that recoveries of over Rs 102 billion had been made during the last three years on account of financial irregularities.
Nisar said that all the officers are answerable to parliament and no slackness will be tolerated in this regard. Senior Officials of Pakistan Railways briefed the PAC about Railways affairs and main reasons of deficit. They said that Railways has shortage of engineers for locomotives.
He said to improve current situation there was need to focus on freight trains. PAC directed interior ministry to hold inquiry through FIA officers within one month into railway scrap sale scam. In his comments, Chairman PAC Chaudhry Nisar Ali Khan said that the decisive time for the PAC will be, when it will take up the audit paras and scams of the present government.
"The defining moments for the PAC will come when it will take scandals of the present government after few weeks and the PAC should have to devise a strategy and set rules while going through the audit paras and scams of the present government as it will be test time," Nisar said.
The out-going member of the PAC Riaz Hussain Pirzada (now Federal Minister for Minorities Affairs) who had come to express his thanks to committee chairman and other members before tendering his resignation from the Committee. He said that the PAC would lose its strength if Chaudhry Nisar leaves. He said that he had noticed difference in Chaudhry Nisar being Chairman PAC and Leader of Opposition in the National Assembly (NA).