Pakistan - Mismanagement of Rs3.12 Trillion

It is no secret that the organs of the Pakistani state are plagued with corruption and the pursuance of personal interest over the interest of the state is prevalent. During every fiscal year, the work and inflow of cash in federal ministries is audited. There are a total of 40 ministries and out of those, some are randomly selected and their work is monitored. For the year 2016-17, 36 ministries were selected for the process; and out of this “selective” audit the Auditor General of Pakistan (AGP) discovered that around Rs3.12 trillion of public money has been mismanaged – imagine what number would emerge if all the ministries were completely audited.

Rs 3.12 trillion are a huge sum to just be casually ignored. For the longest time, the government in power has been trying to convince people of the increment in economic prosperity and the increase in revenue collection, but it is hard for them to make a case for it – even if we buy their initial assertions – when it is being spent in such a mismanaged manner

This is not just bad bookkeeping practices, but criminal violations of financial regulations in several cases. 123 cases have been highlighted where Rs876 billion were lost due to irregular expenditure and violation of rules. Rs1.9 trillion has been lost due to weak financial management. 52 cases point out that unsound asset management has resulted in a loss of Rs9.5 billion. Rs1.5 trillion are gone because of weak internal financial control, and Rs730 billion due to overpayments.

The Finance Ministry has not been able to reconcile expenditure since June and the amount is around Rs656 billion. The ministry has been using supplementary grants to have access to more money, despite knowing that supplementary grants can and should only be used in cases of extreme emergency. Even if they do decide to utilise that money, it should be brought to the parliament; which is conveniently ignore. More than 76 percent (Rs838 billion) of all supplementary grants have not been approved by the parliament. It is quite obvious that for such a large scale activity to take place, a lot of key players are involved. And when the people at the top (in this case they are the heads of government spending and Accountant General of Pakistan Revenue (AGPR) do not impose financial control, the rest can siphon off funds.

Irreconcilable audits are not meant to just alarm us – they require that action be taken against offenders and procedures tightened. The government’s promise of economic prosperity will never be realised or believed if the federal ministries are a leaking ship where revenue disappears into an unaccounted void.