Low recovery of loans: HBFC has almost become bankrupt, says minister

Minister of State for Finance, Rana Muhammad Afzal has stated that House Building Finance Corporation (HBFC) has almost become bankrupt due to lower recoveries of the disbursed loans. Speaking at a meeting of the Senate Standing Committee on Finance chaired by Senator Saleem Mandviwalla here Thursday, the minister stated that HBFC like institutions in other countries have developed cities; however, in Pakistan it (HBFC) has become bankrupt primarily because borrowers are not repaying their loans. The minister made these remarks during discussion by the committee on loans write-off scheme announced by former finance minister Ishaq Dar in budget speech 2017-18.
The meeting was informed that the Finance Division has approved Rs 500 million for providing "relief to widow borrowers of HBFC" to write off their outstanding loans. The meeting was submitted a contour of the detailed plan; however, some members questioned how the scheme will be implemented by March 31, 2018 with tedious progress with respect to identification of beneficiaries, etc.
On the agenda item of separation of cadres of accounts and audit in line with the summary approved by the Prime Minister, Secretary Finance Arif Ahmed Khan informed the committee that Finance Division has forwarded the matter to the Establishment Division and assured the committee that he will pursue the matter in line with the directives of the committee. The minister of state for finance argued that the separation of these two institutions is vital for better working and performance.
The committee was also told that over 650 posts have been lying vacant in the schools of Federally Administered Tribal Areas (FATA) for quite some time and now has it has been tried to fill them up. Senator HidayatUllah, who was a special invitee, stated that around 1,400 ghost employees are drawing salaries from schools and hospitals. The chairman of the committee stated that two issues, including legislation regarding federal consolidated fund and public accounts, have been pending for long with no progress from Finance Division on either of them.
The secretary finance stated that work on them has been completed and report has been submitted to the advisor. Saleem Mandviwalla stated, "these two matters are constitutional requirement and he does not see any problem for finance minister to implement them. This is something mentioned in the Constitution but not being done."