BALOCHISTAN PROVINCIAL ASSEMBLY SECRETARIAT

transcript

BALOCHISTAN PROVINCIAL ASSEMBLY

SECRETARIAT

Report of the

PUBLICACCOUNTSCOMMITTEEon Appropriation Accounts ofthe Government of Balochistan for the Financial Year 2016-17 andReport of the Auditor General of Pakistanfor the Audit Year 2017-18

BALOCHISTAN PROVINCIAL ASSEMBLY SECRETARIAT

Report of the

PUBLICACCOUNTS

COMMITTEEon Appropriation Accounts of

the Government of Balochistan for the Financial Year 2016-17

andReport of the Auditor General of

Pakistanfor the Audit Year 2017-18

Devastation for those who exact full measure when they take from others, but when they measure or weigh for others give

less than what is due. Do they not think that they will be raised up one day? for [presence] on a great day. The day

when men will stand up before the Lord of the worlds.

CONTENTSABBREVIATIONS/ACRONYMS i

PREFACE iii

EXECUTIVE SUMMARY iv

RECOMMENDATIONS xii

SUMMARIES, TABLES & CHARTS xv

REPORT xxix

CERTIFICATION AUDIT OF ACCOUNTANT GENERAL BALOCHISTAN 1

COMMUNICATION AND WORKS (C&W) DEPARTMENT 6

BOARD OF REVENUE 17

HEALTH DEPARTMENT 37

SERVICES & GENERAL ADMINISTRATION DEPARTMENT (S&GAD) 52

IRRIGATION DEPARTMENT 71

PUBLIC HEALTH ENGINEERING (PHE) DEPARTMENT 88

EDUCATION DEPARTMENT 100

a. COLLEGES, HIGHER & TECHNICAL EDUCATION DEPARTMENT 104

b. SECONDARY EDUCATION DEPARTMENT 111

UNIVERSITY OF BALOCHISTAN AND AREA STUDY CENTER 126

AGRICULTURE AND COOPERATIVES DEPARTMENT 137

POLICE 148

EXCISE & TAXATION DEPARTMENT 158

FISHERIES DEPARTMENT 167

LIVESTOCK AND DAIRY DEVELOPMENT DEPARTMENT 179

FOREST AND WILDLIFE DEPARTMENT 191

SARDAR BAHADUR KHAN WOMEN’S UNIVERSITY (SBKWU) 199

SPORTS DEPARTMENT 205

ABBREVIATIONS/ACRONYMSAG Accountant General

APPM Accounting Policies and Procedures Manual

APUG AllPakistanUnifiedGroup

B&R Buildings and Roads

BoQ/BOQ Bill of Quantities

BPPRA Balochistan Public Procurement Regularity Authority

BST Balochistan Sales Tax

CPWA Central Public Work Accounts

CPWD Central Public Works Department

C&W Communication and Works

CSR Composite Schedule of Rates

Cft. Cubic Feet

DAC Departmental Accounts Committee

DAOs DistrictAccountOffices

DDO DrawingandDisbursingOfficer

DG Director General

E&M Electrical and Mechanical

FIA Federal Investigation Agency

FIR First Information Report

FTR Federal Treasury Rules

GBPS Government Boys Public School

GFR General Financial Rules

GoB Government of Balochistan

Kg Kilogram

Km Kilometer

M Meter

MFDAC Memoranda for Departmental Accounts Committee

MB Measurement Book

Mm Millimeter

MSD Medical Store Depot

NIT Notice Inviting Tender

NOC NoObjectionCertificate

NSR Non-Schedule Rate

PAC Public Accounts Committee

REPORT OF PAC - BALOCHISTAN PROVINCIAL ASSEMBLY

PAO PrincipalAccountingOfficer

PC-I Planning Commission (Proforma-I)

PFHA Pasni Fish Harbor Authority

PD Project Director

P&D Planning and Development

POL Petroleum, Oil and Lubricants

PSDP Public Sector Development Program

QESCO Quetta Electric Supply Company

Rft. Running Feet

SDAC Special Departmental Accounts Committee

SDO SubDivisionalOfficer

Sft. Square Feet

TOs TreasuryOffices

UoB University of Balochistan

UPVC Un-plasticized Polyvinyl Chloride

Vol Volume

ABBREVIATIONS/ACRONYMSii

P R E F A C EThe Report of the Auditor General of Islamic Republic of Pakistan on the

Accounts of Government of Balochistan for the Audit Year 2017-18 and

Finical Year 2016-17 was laid before the House on 18th December, 2018

by the Finance Minister, Balochistan as required under Article 171 of the

Constitution of Islamic Republic of Pakistan, 1973. As per Rule 174 of

the Provincial Assembly of Balochistan, Rules of Procedure and Conduct

of Business 1974, such reports are referred by the Speaker to the Public

Accounts Committee (PAC) for examining appropriation of the sums granted

by the Assembly for expenditure of the Government of Balochistan to ensure

transparency through parliamentary oversight.

PAC, in principle, examines with reference to the facts of each case with special regard to the circumstances

leading to any excess expenditure and makes recommendations. The current PAC was saddled with a tough

taskofexamining thedetailsof theexpenditureofeachdepartment todetectfinancialmismanagement

and lay guidelines for future. Under the surveillance of Audit Report 2017-18, major issues, concerns and

committees’generalrecommendationsoneachdepartmenthavebeenhighlightedinthespecificsectionsfor

a quick glance on their adherence to rules and performance.

ThePACexaminedthesaidAuditReportinseriesofmeetingsspanningoverthirty-five(35)sittingsheldin

the Committee Room of the Provincial Assembly of Balochistan. In this Report the Audit Paras/observations

pertaining to each department of the Government of Balochistan are arranged separately. Tables showing

details of total Paras and recommendations of PAC thereon have also been added for ready reference.

The accomplishment of this exercise is an outcome of sincerity, hard work and eagerness of the Hon’ble

Members of the Public Account Committee who under the leadership of the Chairman made the assignment

possible well in time. Mr. Akhtar Hussain Langau, Chairman, Public Accounts Committee remained nucleus

throughout who proved himself a potent motivational guide to the PAC Staff for channelizing its energies into

the right directions pushing them up to render the requisite services up to the mark.

The drafting and preparation of this report has been made possible due to the determined hard work of the

officersandstaffofthePAC.Theirsincereanddevotedendeavorsdeserveappreciationandcommendation.

This Report of PAC is presented to the Provincial Assembly of Balochistan under Rule 162 of the Provincial

Assembly of Balochistan Rules of Procedure and Conduct of Business, 1974.

I am optimistic that the suggestions and recommendations of the PAC would encourage and assist the

Governmentinsmarteninguptheprocedureforeffectivepublicfinancialmanagementsystem,infuture.

Sd/-SAFDAR HUSSAIN

Secretary,Provincial Assembly of Balochistan

2016-16

E X E C U T I V E S U M M A R Y As Chairman Public Accounts Committee (PAC), I have the honor and it gives

me immense pleasure to present the first-everReport of Public AccountsCommittee (PAC) on the Appropriation Accounts 2016-17 and Audit Report 2017-18 before this August House. The Report of Auditor General for the Audit Year 2017-18 was tabled in the House on 18th Day of December, 2018 and then referred to the Public Accounts Committee for detailed examination.

2. It is a fundamental principle of any Parliamentary System that each Federal, Provincial and District Governments must be held accountable to the Legislature (by whose authority it governs) and through the Legislature to thetaxpayersatlarge.ThisprocessisexplicitlyreflectedinArticles169-171of the Constitution of the Islamic Republic of Pakistan, 1973 whereby the Auditor General of Pakistan submits Annual Audit Reports to the Governor, Balochistan who causes them to be laid before the Provincial Assembly. These reports are then referred to the Public Accounts Committee under Rule 174 of the Provincial Assembly of Balochistan, Rules of Procedure and Conduct of Business, 1974.

3. Assembly, in fact, is meant to play the most important role in strengthening the law and practice of accountability/transparency. At the fundamental level, Assembly is supposed to frame an effective and robust legal framework of accountability through legislative oversight. From the conceptual overview of Public Accounts Committee, its function, inter alia, is to ensure legislative oversight through public accountability in Government spending. Crucial aspect of a transparent system of resource allocation involves an independent assurance of the integrity of public budgeting through proper audit process, and the scrutiny of its outcomes by the representatives of the people, in the form of legislature setup as Public Accounts Committee (PAC). There are several factors that have considerable effect on the functions and impact of the Public Accounts Committee. However, the lack of an effective system of public accountability/transparency can pave way for inability to safeguard public funds and assets.

4. At the very outset of its tenure, the current Assembly faced multitude of

E X E C U T I V E S U M M A R Yiv

2016-16

challenges, but still kept accountability and transparency high on its agenda because of the commitment of all parties represented in the Provincial Assembly to strengthen public accountability. The members of PAC were furthermore cognizant of the fact that accountability and transparency was essential for establishing democracy on a strong footing for which they all had rendered greatsacrificesinthedemocratichistoryofthecountry.

5. ThecurrentPACunderRule160of theProvincialAssemblyofBalochistan,Rules of Procedure and Conduct of Business, 1974 was constituted on 1st April, 2019 having in hands the responsibilities/functions as envisiged in Rule 161.

6. Soon after its constitution, PAC decided to examine the Report of the Auditor General of Pakistan on the Accounts of Government of Balochistan for the financialyear2016-17(thelatestAuditReportinhand)thoughthisCommitteeinherited a backlog of around 30 years’ Audit Reports. The PAC examined the Appropriation of Accounts and Audit Report 2017-18 within one year’s period. PAC held thirty-five (35) marathon sessions examining 16 AppropriationAccounts, 18 Public Financial Management Issues and 154 Audit Paras/observations. The Committee completed its task with the denotation, transparency and guidance to the Institutions for corrective actions. The Committee also kept a regular check on the progress of implementation of directives issued to the departments.

7. As a result of the committee’s efforts, large amounts of Government funds were recovered. During the period from April, 2019 to February, 2020 the Auditor GeneralOfficeverifiedrecoveriesamountingtoRs.1,024.94million.Variousissues which remained unresolved for years got settled due to the Committee’s intervention. Similarly pending issues between various departments were resolved. The proceedings of the PAC remained open throughout to the media. Reporting by the journalists and attending the meetings as observers encouraged public interest in the work of PAC.

8. As Chairman PAC, I came to the conclusion that Administrative System in the Departments is deeply entrenched in the obsolete conventional techniques and tries their best to maintain the status quo. In certain cases, they try to take-in the Committee by concealing the facts and resorting to the bureaucratic

complication. During the course of meetings, I very strongly felt that the executives have not adjusted themselves to the changed dynamics of the society for reasons unknown. Every time, a new excuse peeped up; and made its way and a new bureaucratic innovation reveals to obstruct the implementation of relevant law/procedure.

9. Persistent follow up of the Paras was cry of the day for officialdom to getcompliance through bureaucratic chaos. In the following paragraphs, I wouldliketohighlightafewinstancesthatspeakvolumeoftheinefficiency,mismanagement, un-professionalism that prevail in the system through decades. Sole intention to highlight these issues is to invite attention of this AugustHouseandtourgeuponthemtodeviseamechanismtogetridofflawsin this obsolete and rotten administrative system. Many significant issuessurfaced during the Committee deliberations on the Report of the Auditor General. At the culmination of each PAC meeting, replies by the Principal AccountingOfficers (PAOs)andthedirectives issuedbythePACasaresultof discussion on each Para were issued for the necessary actions by the PAOs which are appended to this Report.

10. The PAC discussed and covered many important issues, keeping in view of the fact that due to various forms of irregularities, unfair means and corrupt practices, masses of Balochistan has suffered a lot. Committee, in its sessions, discussed matters of public interest pertaining to Government Departments, their roles, functions, responsibilities, achievements and drawbacks and tried toovercometheshortcomingsforthebenefitoftheProvince.

11. While examining the Appropriation Accounts of Financial Year

2016-17 and Audit Report 2017-18 thereon, the PAC observed the

following issues:-

(i) huge savings and excesses; (ii) non-surrender of savings in time;(iii) variationsinthefiguresofvariouscomponentsofthegrant;(iv) stateoffinancialindiscipline;(v) officialnegligence;(vi) ineffectivefinancialmanagement;(vii) non-effective internal controls of PAOs;

E X E C U T I V E S U M M A R Yvi

(viii) lack of transparency measures;(ix) reluctance to produce record to Audit;(x) violationandnon-observanceofgeneralfinancialrules(GFR);(xi) intentional delays in regularization of cases; (xii) non-maintenance of record;(xiii) non-maintenance of Stock Accounts;(xiv) non-recovery of Government taxes and duties;(xv) hesitation of PAOs to appear before the PAC in person;(xvi) misuseofofficialvehicles;(xvii) late releases of funds by the Finance Department;(xviii) NAB and Court Cases in a number of Departments;(xix) not holding of DAC meetings on regular/timely basis; (xx) non-implementation of DAC decisions; (xxi) non-implementation of PAC Directives in given time frame; (xxii) late submission of the working papers;(xxiii) loss to public exchequer due to acts of omission & commission; and(xxiv) non-observance of prescribed procedures in execution of development

schemes.

DIRECTIVES OF PAC:

12. All the above issues were discussed in detail and issued the following directives:―

• Every Department should hold meetings of Departmental Accounts Committee (DAC) on regular/timely basis.

• Financial discipline and prevailing rules must strictly be followed by the Departments and rules should be framed on urgent basis where lacking.

• ThePrincipalAccountingOfficersshouldbefullyinformedandequipped with complete record before appearing in the Public Accounts Committee.

• The Financial Management System should be strengthened to minimize savings and excess.

• The transparency measures in financial management system

andofficialsystemshouldbeadopted.

• All sorts of tactics that delay official proceedings should bediscouraged by every Head of Department.

• Different inquiries directed by the PAC should be completed within the given time frame.

• Human resource dealing with the Accounts and Budget should be skilled & trained for such assignments to control the budgetary system.

• Being the duty of PAOs to ascertain that the facilities provided to them are as per their entitlement and should not be beyond their ceilings.Violations on this account depict financialirresponsibility.

• The FIRs of theft cases, cases referred to FIA and NAB should be dealt on priority basis to discourage wrong doers.

• Court cases should be given priority and personal attention by the PAOs.

• Proper use of Government vehicles and other assets should be ensured.

• All organizations receiving public funds or established by Government will get their accounts audited by the Auditor General of Pakistan under the Article 170-(2).

ACHIEVEMENTS OF PAC:

13. TheCommitteehasachievedthefollowinginashortspan:―

• Complete examination of Audit Report for the Audit Year 2017-18 within nine (9) months.

• Presentation of PAC Report within given time (one year).

• Active and Functional PAC.

E X E C U T I V E S U M M A R Yviii

• Making the audit and public accountability system effective.

• Recovery of Rs.1,024.94 Million.

• Making the PAOs responsive enough to the directives of PAC.

• A number of Departments that previously refused to get their accounts audited, were made to submit easily their accounts to Audit Teams and appear before the PAC.

14. I pay my special compliments and thanks to the Honourable Speaker, Mir Abdul Quddus Bizenjo for his continuous support and encouragement. I cordially thank all the PAC members for taking special interest and active participation in the PAC sessions, resolving public interest issues, recovering the public money and investing their precious time to conduct hectic and lengthy working hours of PAC sessions. I owe the achievements of the PAC to all my colleagues, because without their cooperation, this would not have been possible to complete the task within a short period of time.

15. My special thanks to the Accountant General Balochistan, KhwajaOvais, former AG Balochistan, Mr. Nasrullah Jan, Director General Audit Balochistan, Mr. Ghulam Sarwar Mandokhail and his team and former DG Audit Balochistan, Mr. Mehmood Amir who worked hard for the accomplishment of the task in time.

16. I also appreciate the efforts of the Principal Accounting Officers (PAOs)who cooperated with the Audit team, held their DAC meetings in time, implemented PAC Directives and provided/furnished the required working papers in time.

17. Being the Chairman of PAC, I appreciate the efforts of Media representatives who worked equally hard with their full devotion and highlighted all important issues discussed by PAC.

18. I must acknowledge the hard work and efforts of PAC Section including―

• Mr. Safdar Hussain Secretary Assembly,

• Mr. Tahir Shah Kakar Special Secretary Committees,

• Mr. Muhammad Hashim Davi Deputy Secretary,

• Mr. Siraj ud Din Lehri Deputy Secretary (PAC),

• SyedMuhammadIdreesChiefAccountsOfficer(PAC),and

• OtherstaffofthePACSection,―

who worked with zeal and zest in scheduling, arranging, coordinating frequent PAC workingsessions,draftingMinutes,preparingandcompilingthisfirsteverReportofPAC. I appreciate their focused efforts for providing in time support.

CLOSING REMARKS:

19. While submitting this Report to the Provincial Assembly of Balochistan, it is immensely recommended that in an ideal situation, there might be a set mechanism for the measurement of PAC performance. PAC mandate ensures to depictrecommendatoryvisionofallPrincipalAccountingofficers(AdministrativeSecretaries) who are vital element of this report; their necessary actions towards accountabilityareobligatorysymbolsofmovementtowardsefficientandeffectivepublic administration. In broad-spectrum, PAC would otherwise precisely have the opportunity, potential and resources to effectively examine any audit report that is transmitted to it by the worthy Governor Balochistan through the August House. The Government functionaries ought to be required to respond formally tothePACrecommendations/directionswithinaspecifiedperiodwithresponsesto be made public as and when the occasions demand so.

(TAHIR SHAH KAKAR) Special Secretary (Committees)

Sd/-(AKHTAR HUSSAIN LANGAU)

Chairman,Public Accounts Committee

E X E C U T I V E S U M M A R Yx

Mr. Akhtar Hussain Langau (Chairman)

Sardar Yar Muhammad Rind Syed Muhammad Fazal AghaMalik Naseer Ahmed Shahwani Mir Asadullah Baloch

Mr. Zahoor Ahmed BulediEng. Zmarak Khan Achakzai Mr. Abdul Khaliq Hazara

Mr. Nasrullah Khan Zayray Mr. Sanaullah BalochMr. Zabid Ali Reki

CHAIRMAN AND MEMBERS OFPUBLIC ACCOUNTS COMMITTEE (PAC)

RECOMMENDATIONS

Based on the examination of Audit Report 2017-18 and Appropriation

Accounts 2016-17, the recommendations of Public Accounts Committee are

as under –

i. suggestions, directives and recommendations made by the Public Accounts Committee (PAC) be implemented by the Provincial Government through its respective Departments to improve financial, administrative and operational performance;

ii. the Excess Budget Statement for the year 2016-17 be regularized in accordance with the provisions of the Constitution;

iii. all departments should ensure the timely surrender of savings to the Finance Department and Supplementary grant should not be requested unless complete executing plan and reasonable time for its implementation is available;

iv. orientation program on regular basis be arranged by the Accountant General, Balochistan to all PAOs & their relevant staff in the Pakistan Audit & Accounts Academy for preparing and submitting replies on Appropriation Accounts to the Public Accounts Committee;

v. to overcome irregular expenditure (in Audit Report 2017-18 it amounts to 50.83% of total irregularities), an effective internal control system should be established in each Government Department;

vi. beside Statutory Audit as performed by the Auditor General Pakistan, an Internal Audit system/function should be established in each department to ensure effective internal control, which includes safeguarding of Public Assets, adherence to rules/regulations, policies/procedures of the Provincial & Federal Governments, financial reporting and risk assessment. This function will add utility in the Statutory Audit system;

vii. departments prepare and submit their budgets to Finance Department on incremental basis, without proper justification and accurate forecasting, which results in either huge savings or excess. Finance department in collaboration with PAOs should implement Zero-based budgeting instead of incremental (traditional) budgeting system;

RECOMMENDATIONSxii

viii. PAOs need to comply strictly with the Balochistan Public Procurement Rules, 2014 and General Financial Rules (GFRs);

ix. PAOs need to ensure adherence to the rules and the Government Instructions;

x. Departments functioning as Executive Agencies need to follow Prescribed Procedures/Composite Schedule Rates (CSR) and strictly avoid (NSRs);

xi. PAOs should give serious and personal attention to Court Cases;

xii. before coming to PAC the Administrative Secretaries must prepare themselves properly so that neither they are put in awkward position nor the time of the Members is consumed unnecessarily;

xiii. Audit teams while conducting audit of the departments, officials responsible in the misdeed be pointed out for fixing responsibility to facilitate the job of PAC and the concerned departments;

xiv. non-production of record is a serious irregularity, which hinders audit activity and comes under non-abeyance of prevailing Laws. PAOs need to take disciplinary action against those who are found responsible for non-production of records to audit;

xv. D.G Audit, Balochistan should avoid raising of Paras pertaining to non-production of records rather matter be taken up with the Chief Secretary, Balochistan during the course of conducting audit;

xvi. overlapping of development activities may strictly be avoided;

xvii. Finance department, in collaboration with PAOs of revenue generating departments should set rationalized revenue targets, in future and serious efforts for realization of such targets;

xviii. drawl of public money on abstract bills should be restricted and be allowed in cases where justified;

xix. purpose for which the money is granted should be clearly specified in case of grant-in-aid and no grant be given without obtaining detailed accounts of the previous grant;

xx. public money should not be retained in commercial bank accounts without justification and permission from the Finance Department;

xxi. efforts need to be made by the PAOs to recover overpaid amounts in time;

xxii. PAOs should establish a mechanism of management controls with built-in checks and balances to prevent unauthorized practices and utilization of public assets;

xxiii. PAOs should timley / regularly convene DAC meetings and its decision be strictly implemented;

xxiv. as per prevailing Rules, inquiries need to be conducted to fix responsibilities for loss, fudge payments and doubtful expenditure;

xxv. PAOs should instruct their attached departments and field offices to respond to the directives of PAC well in time;

xxvi. all PAOs should hold departmental pre-PAC meetings to streamline submission of proper and timely working papers to PAC; and

xxvii. tenders must be floated in leading newspapers in accordance with the Government policy and rules so that maximum participation is made and the chance of irregularity is avoided.

RECOMMENDATIONSxiv

SUMMARIES, TABLES & CHARTS

PUBLIC EXPENDITURE AND FINANCIAL ACCOUNTABILITY CYCLE

1. Budget proposal is considered and approved by the Provincial Assembly of Balochistan and schedule of Authorized Expenditure is authenticated by theChiefMinisterBalochistanasperArticles120-125oftheConstitutionofPakistan, 1973 and Rules 116-127 of the Provincial Assembly of Balochistan Rules of Procedure and Conduct of Business, 1974.

2. Schedule of Authorized Expenditure is sent/forwarded to the executing departments/Principal Accounting Officers via Finance Department,Government of Balochistan.

3. Accountant General Balochistan, under Section 5 (a) of Controller Generalof Accounts Ordinance, 2001, prepares and maintains the accounts of the Government of Balochistan in such forms and in accordance with such methods and principles as the Auditor-General may prescribe from time to time.

4. Auditor General of Pakistan Conducts the Audit of the Accounts of the Government of Balochistan and any authority or body established by the Provincial Government under Article 170 (2) of the Constitution of Islamic Republic of Pakistan, 1973. Auditor General’s Report is submitted to the Governor Balochistan under Article 171 of the Constitution of Islamic Republic of Pakistan, 1973.

5. Governor Balochistan under Article 171 of the Constitution causes the Auditor-General Report to be laid before the Provincial Assembly of Balochistan.

6. Speaker Balochistan Assembly under Rules 174 of the Provincial Assembly of Balochistan, Rules of Procedure and Conduct of Business, 1974 refers the Auditor General’s Report to the Public Accounts Committee (PAC).

7. Public Accounts Committee under Rule 161 (1) of the Provincial Assembly of Balochistan, Rules of Procedure and Conduct of Business, 1974 invites departmentalSecretaries/PrincipalAccountingOfficers(PAOs)totheCommitteefor questioning and examining Appropriation Accounts of the Government of Balochistan and the report of the Auditor-General.

8. Under Rule 162 of the Provincial Assembly of Balochistan, Rules of Procedure and Conduct of Business, 1974 the PAC presents its Report to the House within a period of one year from the date on which reference was made to it unless the Assembly on a motion being made, directs that the time for the presentation of thereportbeextendedtoadatespecifiedinthemotion.

PUBLIC EXPENDITURE AND FINANCIAL ACCOUNTABILITY CYCLE AT A GLANCE

Provincial Assembly of Balochistan

Budget Authorization

Finance Department GoB.

Departments/ Executives

Accountant General

Balochistan

Director General Audit, Balochistan Audit Report

Governor Balochistan

Public Accounts Committee

Provincial Assembly of Balochistan

Accountant General Balochistan Report of the PAC

xviii SUMMARIES, TABLES & CHARTS

SCOPE OF AUDIT 2017-18

Rs. In Million

# Particulars Amount

1. Total Budget 2016-17 281,519

2. Actual Expenditure 2016-17 256,071

3.Auditable Expenditure under jurisdiction of D.G Audit Balochistan

180,896

4. Expenditure Audited by D.G Audit Balochistan 144,477

SCOPE OF AUDIT 2017-18 AT A GLANCE

SCOPE OF AUDIT IN TERMS OF PERCENTAGE

# Particulars %

1. Audited Expenditure to Auditable Expenditure of F.Y 2016-17 79.86%

2. Audited Expenditure to Actual Expenditure of F.Y 2016-17 56.42%

281,519

256,071

180,896

144,477

Total Budget 2016-17

Actual Expenditure 2016-17

Auditable Expenditure under Jurisdic�on of D.GAudit Balochistan

Expenditure Audited by D.G Audit Balochistan

Rs. in Million

PARAS REFERRED TO PAC AND MFDAC

# DepartmentParas

referred to PAC

Paras in MFDAC* Total

1. Accountant General Balochistan 18 - 182. Communication & Works Department 20 - 203. Board of Revenue 16 - 164. Health Department 11 114 1255. Services & General Administration Department 19 - 196. Irrigation Department 10 14 247. Public Health Engineering Department 8 - 8

8.Education Department:a. Colleges, Higher & Technical Education 6 19 25b. Secondary Education 13 60 73

9. University of Balochistan & Area Study Center 8 19 2710. Agriculture & Cooperatives Department 8 4 1211. Police 5 - 512. Excise & Taxation Department 5 9 1413. Fisheries Department 10 6 1614. Livestock & Dairy Development Department 5 4 915. Forest & Wildlife Department 6 - 616. SBK Women’s University, Quetta 2 - 217. Sports Department 2 - 2

Total Audit Observations 172 249 421

*MFDAC: Memoranda for Departmental Accounts Committee.

PARAS REFERRED TO PAC AND MFDAC AT A GLANCE

PAC 172

xx SUMMARIES, TABLES & CHARTS

BREAKUP OF AUDIT OBSERVATIONS REFERRED TO PUBLIC ACCOUNTS COMMITTEE

# Department

c Fina

ent Is

sues Audit Observations

ular E

n of R

thoriz

ion of

tful E

ined b

1 Accountant General Balochistan 18 - - - - - - - - 18

2 Communication & Works Department - 4 - 2 2 9 3 - - 20

3 Board of Revenue - 10 2 3 1 - - - - 16

4 Health Department - 3 1 1 1 2 1 1 1 11

5 Services & General Administration Department - 10 2 3 1 - - 2 1 19

6 Irrigation Department - 3 - - 1 4 2 - - 10

7 Public Health Engineering Department - 2 - 1 1 3 1 - - 8

Education Department: -

a. Colleges, Higher & Technical Education - 2 1 - 2 - - - 1 6

b. Secondary Education - 7 1 1 2 - 2 - - 13

9 University of Balochistan & Area Study Center - 2 - 3 2 - - - 1 8

10 Agriculture & Cooperatives Department - 6 - 1 - - - 1 - 8

11 Police - 4 - - 1 - - - - 5

12 Excise & Taxation Department - 1 - 4 - - - - - 5

13 Fisheries Department - 4 - 2 2 - 2 - - 10

14 Livestock & Dairy Development Department - 2 - 1 - - - 1 1 5

15 Forest & Wildlife Department - 6 - - - - - - - 6

16 SBK Women’s University, Quetta - - 1 - - 1 - - - 2

17 Sports Department - - - - - - 1 1 - 2

Total Audit Observations 18 66 8 22 16 19 12 6 5 172

Appropriation Accounts 16

BUSINESS REFERRED TO PAC AT A GLANCE

CLASSIFICATION OF AUDIT OBSERVATIONS

# Audit Observations Number of Audit Observations Percentage

1. Irregular Expenditure 66 38%

2. Non-Production of Record 8 5%

3. Recoverables 22 13%

4. Unauthorized Expenditure 16 9%

5. Overpayments 19 11%

6. Evasion of Taxes & Duties 12 7%

7. Doubtful Expenditure 6 4%

8. Loss sustained by the Government 5 3%

9. Public Financial Management Issues 18 10%

Total 172 100%

16 Audit Observa�ons in the Departments of Govt. ofBalochistan

Public Financial Management Issues raised inCer�fica�on Audit of A.G Balochistan

Variances in Appropria�on Accounts of Departments

xxii SUMMARIES, TABLES & CHARTS

CLASSIFICATION OF AUDIT OBSERVATIONS AT A GLANCE

The biggest chunk of the Pie Chart (i.e. 38%) represents Irregular Expenditure incurredbythePrincipalAccountingOfficers(PAOs)inthevariousdepartmentsofthe Government of Balochistan during the Financial Year 2016-17. The occurrence of huge irregular expenditure is the evidence of weak and ineffective internal controlsysteminthedepartmentsofGovernmentofBalochistanandintheofficeofAccountant General Balochistan who is entrusted with the function of pre-audit of expenditure, maintenance of the Accounts and preparation of Financial Statements of Government of Balochistan.

5% 13%

7% 4% 3% 10%

Irregular Expenditure

Non-Produc�on of Record

Recoverables

Unauthorized Expenditure

Overpayment

Evasion of Taxes & Du�es

Doub�ul Expenditure

Loss sustained by the Govt.

Public Financial ManagementIssues

FREQUENCY OF VIOLATION OF CRITERIA

# Particulars Frequency

1. General Financial Rules 502. Central Public Works Account Codes 203. Federal Treasury Rules 194. Balochistan Public Procurement Rules, 2014 145. Accounting Policies & Procedures Manual 136. Planning & Development Department’s Notifications 117. Finance Department’s Notifications 108. Composite Schedule Rates 1998 79. Income Tax Ordinance, 2001 7

10. Constitution of Pakistan, 1973 611. Auditor General Ordinance, 2001 612. Building & Road Codes 513. Finance Division’s Office Memorandum 514. Delegation of Financial Powers, 2008 415. Pasni Fisheries Harbor Authority Ordinance, 1983 416. Stamp Act, 1899 317. Balochistan Staff Cars Rules, 2000 218. Audit Code 219. Land Revenue Act, 1967 220. Supreme Court Orders 221. Balochistan Sales Tax on Services Act, 2015 222. Services & General Administration Department’s Notifications 223. Sales Tax Act, 1990 124. Audit Manual 125. Usher Rules, 1994 126. Abiana Rules, 1999 127. Balochistan Residential Accommodation Rules, 1982 128. University of Balochistan Financial Rules 129. Motor Vehicle Ordinance, 1965 130. Presidential Orders, 1979 1

xxiv SUMMARIES, TABLES & CHARTS

31. Urban Immoveable Property Act, 1958 132. Health Department’s Notifications 133. Public Health Engineering Department’s Notifications 134. Scales of Electrical & Mechanical Workshop 135. SOPs of Higher Education Commission 136. General Conditions of Contract 1

Total 210

BREAKUP OF PAC DIRECTIVES

# Particulars No. of Paras

1. Paras Deferred 49

2. Paras Referred to Special DAC 36

3. Paras Settled Subject to Condition(s) 38

4. Paras Settled 49

Total 172

BREAKUP OF PAC DIRECTIVES AT A GLANCE

21%22%

28% Paras Deferred

Paras Referred to Special DAC

Paras Se�led Subject to Condi�on(s)

Paras Se�led

FINAL GRANT OF NON-DEVELOPMENT VS ACTUAL EXPENDITURE OF NON-DEVELOPMENT

Huge variances between Final Grant and Actual Expenditure under non-development head show inaccurate forecasting, poor budget planning and financialmismanagementintheexecutingdepartmentsandFinanceDepartment,GovernmentofBalochistan.However,thecommonjustificationgivenbyPAOsforsavings in non-development head was vacant posts.

8,455.990

3,336.100

14,856.700

1,168.445

2,209.192

4,535.473

40,089.715

1,701.800

6,663.519

15,910.142

659.462

791.524

2,301.000

894.352

553.000

662.299

7,524.798

2,595.470

14,986.600

1,126.455

2,269.310

4,625.458

39,502.387

1,482.000

6,591.160

15,280.261

591.304

727.027

2,239.200

826.657

553.532

566.896

Communica�on & Works Department

Board of Revenue

Health Department

Services & General AdministrationDepartment

Irriga�on Department

Public Health Engineering Department

Educa�on Department

University of Balochistan and AreaStudy Center

Agriculture & Cooperative Department

Police Department

Excise & Taxa�on Department

Fisheries Department

Livestock & Dairy DevelopmentDepartment

Forest & Wildlife Department

Sardar Bahadur Khan Women'sUniversity, Que�a

Sports Department Actual Expenditure Non- DevelopmentFinal Grant Non-Development

Rs. in Million

xxvi SUMMARIES, TABLES & CHARTS

FINAL GRANT OF DEVELOPMENT VS ACTUAL EXPENDITURE OF DEVELOPMENT

Most of the departments could not fully utilize the grant under Development Head. ThecommonjustificationgivenbythePAOswaslatereleaseoffundsfromFinanceDepartment, Government of Balochistan.

18,287.000

7,013.000

4,483.967

5,008.670

11,762.178

249.574

4,556.762

406.258

217.000

252.164

274.133

2,072.774

19,398.427

6,451.784

8,329.736

5,139.622

6,843.461

126.183

4,668.476

107.729

244.103

217.221

274.133

389.832

Board of Revenue

Health Department

Services & General AdministrationDepartment

Educa�on Department

University of Balochistan and AreaStudy Center

Agriculture & Cooperative Department

Police Department

Livestock & Dairy DevelopmentDepartment

Sardar Bahadur Khan Women'sUniversity, Que�a

Sports Department Actual Expenditure DevelopmentFinal Grant Development

Rs. in Million

RECOVERY EFFECTED

Rs. In Million

# Departments Recovery Effected

1. Communication & Works Department 23.67

2. Board of Revenue 59.34

3. Health Department 29.20

4. Services & General Administration Department 6.31

5. Irrigation Department 11.78

6. Public Health Engineering Department 5.39

7. Education Department (Secondary) 876.74

8. Excise & Taxation Department 2.34

9. Fisheries Department 7.71

10. Livestock & Dairy Development Department 1.03

11. Forest & Wildlife Department 1.43

Total 1,024.94

RECOVERY EFFECTED AT A GLANCE

876.74

Board of Revenue

Health Department

Services & General Administration Department

Educa�on Department (Secondary)

Livestock & Dairy Development Department

Recovery Effected

Rs. in Million

xxviii SUMMARIES, TABLES & CHARTS

REPORT

CERTIFICATION AUDIT OF ACCOUNTANT GENERAL BALOCHISTAN

(Meeting held on 23rd September, 2019)

INTRODUCTION

TheofficeofAccountantGeneralBalochistaniscounterpartofControllerGeneralof Accounts in Balochistan. The following functions are entrusted to it under the Controller General Ordinance, 2001:-

1. To prepare and maintain the Accounts of the Government of Balochistan in such forms and in accordance with such methods and principles as the Auditor General may prescribe from time to time;

2. To authorize payments and drawls from the Consolidated Fund and Public Account of the Government of Balochistan against approved budgetary provisions after pre-audit checks as the Auditor General may, from time to time, prescribe;

3. To prepare and maintain Accounts of such organizations and authorities established, setup or controlled by the Government of Balochistan as may be assigned to it by the Governor Balochistan;

4. To lay down the principles governing the internal financial control forGovernment Departments in consultation with Finance Department, Government of Balochistan;

5. To render advice on accounting procedure for new schemes, programs or activities undertaken by the Government of Balochistan;

6. To develop and maintain efficient system of Pension, Provident Fundsand other retirement benefits in consultation with the Government ofBalochistan; and

7. To prepare Annual Financial Statements of Government of Balochistan.

PAC OBSERVATIONS

The Public Financial Management issues brought into the consideration of PAC were related to both office of the Accountant General Balochistan and FinanceDepartment, Government of Balochistan. The violation of Accounting Policies & ProceduresManual(APPM)wasrepeatedlycommittedbytheofficeofA.GBalochistanand Finance Department which resulted in non-clearance of Suspense Accounts at year-end, non-settlement of outstanding balances of un-cashed cheques, un-adjusted negative balances, non-reconciliation of balances between District AccountsOffices (DAOs), Treasury offices (TOs) andNationalBank of Pakistan,difference between cash at bank and books of A.G Balochistan, non-submission of paid voucher of General Provident Fund to A.G Balochistan by District Account Offices,un-authorizedexpenditureoutoftheAssignmentAccountsandirregulardrawls/release of development fund. Furthermore, the violation of General Financial Rules(GFRs)andFederalTreasuryRuleswerealsoobservedintheCertificationAudit Report of A.G Balochistan.

ThemostsignificantFinancialManagementproblemsobserved–

1. Inaccurateestimates,poorbudgetplanningandineffectivefinancialcontrolscaused excess expenditure of Rs.11,776 million.

2. LackofcoordinationamongofficeofA.GBalochistan,FinanceDepartment,D.GTreasuriesandAccountsBalochistanandDistrictAccountsOffices/DistrictTreasuryOfficesresultedinunreliablefinancialreporting.

3. Late release of development funds by Finance Department caused the rush of expenditure of Rs.42,000 million in the month of June 2017 out of total developmentexpenditureofRs.73,000millionincurredduringthefinancialyear 2016-17.

4. Lack of coordination among A.G Balochistan, Finance Department and Administrative Departments resulted in late surrendering of savings to FinanceDepartmentRs.15,713million.

5. Delay in centralization/computerization of G.P Fund system is causing inaccurate reporting of G.P Fund liability and increased risk of overpayment to the subscribers of G.P Fund.

CERTIFICATION AUDIT OF ACCOUNTANT GENERAL BALOCHISTAN2

1. Total Public Financial Management Issues 18

Total 18

EXAMINATION OF PUBLIC FINANCIAL MANAGEMENT ISSUES PRINTED IN AUDIT REPORT 2017-18

PARA # 1.1.1: EXPENDITURE WITHOUT BUDGET – RS. 99.347 MILLION.

DuringcertificationauditoftheAccountsofGovernmentofBalochistanfortheyear2016-17, Audit observed that an expenditure of Rs. 99.347 million was incurred by different departments without any budgetary allocation under the relevant head of account. Hence, Audit recommends that expenditure needs to be regularized by the competent authority.

Accountant General Balochistan apprised the forum that Secretary Finance has beenrequestedseveraltimesthroughofficialcommunicationforscrutinizingthe

Paras Deferred

matter in coordination with the AG office as the expenditure incurred withoutbudgetary allocation by the different departments is due to non-availability of the budget check on the heads of pay and allowances and indifferent attitude of the PAOs towards budgeting.

REPLY OF THE DEPARTMENT:

Secretary Finance in his reply explained that almost all of the excess expenditure pertains to pay and allowances which are inevitable payment hence, must be paid. He added that this excess expenditure is needed to be regularized/authorized under the article 124 (b) of the Constitution of Islamic Republic of Pakistan, 1973.

PAC DIRECTIVE(S)

Para was deferred with directives that the Finance Department shall produce relevantdocumentstotheD.GAuditforverificationforsettlingtheissuewithin03months under intimation to PAC for further consideration.

PARA # 1.1.2: VARIATION BETWEEN REVISED BUDGET ALLOCATION AND ANNUAL BUDGET – RS. 963.340 MILLION.

Director General, Audit apprised the Committee that according to Para 7.4.6.3 of APPM, the AG shall only prepare the Appropriation Accounts once the Annual Accountsarefinalized.Thefiguresused foractual expenditures shall bedrawnfrom the Annual Accounts. The budget figures used shall be confirmed by theFinance Department.

He added that during certification audit of the Accounts of the Government ofBalochistanfortheyear2016-17,Auditobservedthefinalgrant/revisedbudgetreported in the Appropriation Accounts for the year 2016-17 did not correspond withthefiguresgivenintheAnnualBudgetBookoftheGovernmentofBalochistan2016-17 which resulted in a difference of Rs. 963.340 million, as detailed below–

CERTIFICATION AUDIT OF ACCOUNTANT GENERAL BALOCHISTAN4

Rs. In Million

S.No. Department Final Grant Reported in Appropriation Accounts

Revised Budget as per Budget Book

2016-17Variation

1. Non-Development 212,497.641 213,460.98 963.339

2. Development 68,058.193 68,058.194 0.001

Total 280,555.834 281,519.174 963.340

A.G Balochistan shared that the issue of variation between Annual Budget Book andSAPfigures regardingDevelopmentandNon-Developmentbudgethasbeencommunicated to the Finance Department, however, no response received despite repeatedremindersissuedbythisoffice.TheSecretaryFinanceassuredthattheAppropriationAccounts for the yearwill be rectifiedby theAccountantGeneralOfficewithintimationtoAudit.

Secretary Finance explained that the amount has been crossed checked with the Annual Budget Statement (ABS) and the Accounting System (SAP) of the Government of Balochistan which was found in conformity with the amount reported by the Audit. He added that upon scrutiny of the Appropriation Accounts, it was ascertained that due to clerical / typographical error, the amount could not be added in the summary of the Appropriation Account.

PAC DIRECTIVE(S)

Para was deferred with directives that the Finance Department shall produce relevantdocumentstotheD.GAuditforverificationtosettletheissuewithin03months under intimation to PAC for further consideration.

Keeping in view the uniform nature of all issues, discussion on rest of the Paras (1.1.3 to 1.1.18) was deferred with the same directives as for Para # 1.1.1 & 1.1.2 above.

COMMUNICATION AND WORKS (C&W) DEPARTMENT

(Meetings held on 10th July, 22nd July & 21st October, 2019)

INTRODUCTION

Construction, maintenance and repair of roads, bridges, tunnels, ropeways and buildings, are the main functions of the Communication & Works Department. It also renders services in thefield of engineering training for thedepartmentalengineers, Public Health Works pertaining to Government buildings and Government residential estates.

PAC OBSERVATIONS

The most remarkable issues observed in Communication & Works Department were payments on Non-Scheduled Rates (NSR) basis, allowing excess quantities, incorrect rates and higher rate of premium to the contractors than approved in PC-Is and execution of works without obtaining the Technically Sanctioned Estimates. These irregularities resulted in Irregular Expenditure and Overpayments which depict weak and ineffective internal control system i.e. non-adherence to the Government rules, regulations, policies and procedures.

Violation of Central Public Works Account Codes, Composite Schedule Rates (CSR) 1998, Stamp Act 1899 and Income Tax Ordinance 2001 were the dominant irregularities.

Note: Percentage in a graph represents frequency of occurrence of irregularities.

Recoverables3%

Overpayments26%

COMMUNICATION AND WORKS (C&W) DEPARTMENT6

1. Total Audit Paras 20

Total 20

KeepinginviewtherequestofPrincipalAccountingOfficer(PAO)andrecommendationof D.G Audit Balochistan, all of the Audit Paras, excluding the fraction of pars in respect of Project Director City Development Project Turbat, were referred to the Special Departmental Accounts Committee (SDAC) on which the compliance will be taken in the next PAC meeting of the department.

ABSTRACT STATEMENT OF RECOVERY

Rs. in Million

# Audit Observation No. of Paras

Amount of Observation

Recovery Effected

1. Irregular Expenditure 04 1,665.11 -

2. Recoverables 02 79.16 4.58

3. Unauthorized Expenditure 02 59.69 -

4. Overpayments 09 641.36 16.05

5. Evasion of Taxes & Duties 03 11.51 3.04

Total 20 2,456.83 23.67

Out of the total recoverable amount of Rs.746.03 million (i.e. Recoverable Rs.79.16 million,OverpaymentsRs.641.36millionandEvasionofTaxes&DutiesRs.11.51million) Rs.23.67 million has been recovered, however, compliance on rest of the recoveries will be taken in next PAC meeting of the department.

GENERAL PAC DIRECTIVES GIVEN IN A MEETING HELD ON 22ND JULY, 2019

Due to non-provision of timely working papers and on the prescribed format, the discussion on all Paras, excluding the Project Director City, Development Project Turbat was deferred with following directives: -

1. Replies of the district and project wise observations, clubbed by audit in a single para, shall be compiled and arranged in order of serial numbers, accordingly andshallalsobesubmittedtothissecretariatonorbefore15th July 2019.

2. Para No.2.2.1 to Para No.2.2.10 Audit Report 2017-18 and Appropriation Account 2016-17 will be discussed on Monday 22nd July 2019.

3. Para No.2.2.11 to 2.2.20 Audit Report 2017-18 and compliance of previous AuditReport2016-17ParaNo.2.2.1,2.2.4to2.2.11,2.2.14and2.2.15willbediscussed on Tuesday 23rd July 2019.

1,665.11

641.36

Irregular Expeniture

Recoverables

UnauthorizedExpenditure

Overpayments

Recovery Effected Audit Observa�on

Rs. in Million

4. ParaNo.2.2.1 (24), 2.2.3 (16)& (17), 2.2.9 (8), 2.2.14 (8) and2.2.17 (35)&(36) in respect of Project Director, City Development Project Turbat are to be discussed today.

EXAMINATION OF APPROPRIATION ACCOUNTS FOR F.Y 2016-17

(Meeting held on 22nd July, 2019)

Accountant General, Balochistan explained that the Development and Non-Development funds amounting to Rs. 26,742.9 million were allocated to the C&W DepartmentunderGrantNo.BC21013duringfinancialyear2016-17.Againstthesaidallocation,anexpenditureofRs.26,923.225millionwasincurred.

The Department did not surrender the saving of Rs. 931.20 million against non-development expenditure and Rs. 185.28 against Development expenditure inconnection with Housing and Community Amenities which indicates improper budgetingandfinancialmismanagement.

Detail of the Appropriation Accounts is summarized below–

Rs. in Million

Head of Account Original Grant

Supp. Grant

Surren-der Final Grant Expenditure Excess/

(Savings) %

Non-Development - - - 8,455.99 7,524.78 (931.20) 11.02

Housing and Community Amenities

- - - 3,339.30 3,154.04 (185.28) 5.55

Roads 14,947.70 16,244.38 1,296.64 8.67

Total Development - - - 18,287.00 19,398.43 1,111.43 6.08

Grand Total - - - 26,742.99 26,923.21 180.23 0.68

PAO/Secretarycontendedandexplainedthatthereishugevariationinfiguresasstated by the AG. Original grant in respect of Non-Development and Development expenditure may be reconciled to seek out the issue. Total funds amounting to Rs.18,963.88millionwereallocatedtotheC&WDepartmentduringfinancialyear2016-17.Againstthesaidallocation,anexpenditureofRs.17,751.06millionwasincurred. Saving in non-development expenditure was made under establishment head as some 2000 posts were laying vacant. So far as savings against development expenditure is concerned, few development schemes could not be executed due to unavoidable circumstances and reasons. Moreover, funds were not released in time. Consequently, the Projects / development schemes could not be completed in due time. Therefore, surrender was extended.

PAC DIRECTIVE(S) (22ND JULY, 2019):

The Committee settled the item with the warning that such lapses should be strictly avoided in future and surplus funds be surrendered well in time.

EXAMINATION OF AUDIT REPORT 2017-18(Meeting held on 10th July, 2019)

PARA # 2.2.1: OVERPAYMENT DUE TO ALLOWING EXCESS QUANTITIES – RS. 215.032 MILLION.

(PARTIALLY DISCUSSED TO THE EXTENT OF CITY DEVELOPMENT PROJECT, TURBAT @ S # 24).

AuditpointedoutthatinviolationofB&RCode2.86andCPWDCode56,thePD,City Development Project Turbat paid the contractor for different items of work by allowing excess quantities/rates other than provided in approved PC-I/technically sanctioned estimates during the year 2015-16 resultantly, an over payment ofRs.3.975millionwasmade.

Project director replied that measurements and payments of work done against aggregate base course of a portion of road was withheld until complete satisfaction of compaction and quality of work. He further added that measurements/payment were made based on Laboratory Test Reports, later on which were observed satisfactory/passed as per standard requirements.

PAC DIRECTIVE(S) (10TH JULY, 2019):

Parawasdeferred tillnextmeetingwithdirection that the recordbe verifiedbyAudit, Balochistan.

PARA # 2.2.3: OVERPAYMENT DUE TO ALLOWING INCORRECT RATE – RS. 101.694 MILLION.

Audit observed that, the Project Director, City Development Project Turbat paid Rs.0.207 million by allowing incorrect rate than admissible as provided in the tender documents in violation of CPWA Code 16 and 220.

Project Director replied that due to excess premium, an amount of Rs.0.207 million was overpaid to the contractor which was recovered and deposited in Govt. Account C-02714 vide Challan No. 28 Dated 30-08-2018 and reported to Director Audit.

TheCommittee settled the Para subject to submission of, duly verified, copy ofDepositedChallantoD.GAuditforverificationunderintimationtothePAC.

PARA # 2.2.3: OVERPAYMENT DUE TO ALLOWING INCORRECT RATE RS. 101.694 MILLION.

Audit pointed out that the Project Director, City Development Project Turbat paid Rs.93.419 million by allowing incorrect rate than admissible as provided in the tender documents in violation of CPWA Code 16 and 220.

Project Director in reply explained that due to non-workability of Composite Schedule of Rates (CSR) 1998 the P&D Department, Government of Balochistan granted approval of workable rates for execution of project based on detail rate analysis report prepared as per standard procedure of the P&D Department with input taken from monthly bulletin, Federal Bureau of Statistics Government of Pakistan. Subsequently, the PDWP, PSC as well as Chief Minister, Balochistan granted approval of the rates which were reasonable and harmonious with respect to market.

Para was deferred with direction to produce the relevant record before audit for verificationunderintimationtothePAC.

PARA # 2.2.9: OVERPAYMENT DUE TO ALLOWING EXCESS QUANTITY OF STONE INCORRECT RATE – RS. 8.771 MILLION.

Audit pointed out that the Project Director, City Development Project Turbat,

allowed payment for an item of work “P/S and S/L hand broken stone” during the year2015-16,withoutconvertinglosequantitiesintocompactedbyapplyingfactor0.67%.Resultantly,anoverpaymentofRs.0.685millionwasmadeinviolationofCSR – 1998.

Project Director shared that extra payment of labor charges for stacking base course amounting to Rs. 4,29,247/- has been recovered from M/S SMS Construction Company and deposited in the Government treasury.

The Committee settled the Para subject to submission of duly verified copy ofDepositedChallantoAuditforverificationunderintimationtothePAC.

PARA # 2.2.14: NON-REALIZATION OF STAMP DUTY – RS. 5.011 MILLION.

Audit observed that in violation of Section 22 A of Schedule I to Stamp Act 1899, the Project Director, City Development Project Turbat, awarded contract to contractor but stamp duty amounting to Rs. 0.119 million in shape of non-judicial stamp papers of the contract valuewasnot realized during the period 2015-16whichresulted into loss to the Government.

ProjectDirectorexplained that thestampduty@0.25%amounting toRs.0.119million has been recovered from the contractor, therefore, he requested the Forum for settling the Para.

TheCommitteesettledtheParasubjecttoprovisionofrecordtoauditforverificationand directed the PD to avoid such irregularity, in future.

PARA # 2.2.17: IRREGULAR / EXCESS PAYMENT – RS. 830.349 MILLION.

(PARTIALLY DISCUSSED TO THE EXTENT OF CITY DEVELOPMENTPROJECT,TURBAT@S#35).

Audit pointed out that the Project Director, City Development Project Turbat paid for different items of work by allowing excess quantities / rates than provided in theapprovedPC-I/TechnicalSanctionestimatedduringtheyear2015-16duetothatanexcesspaymentofRs.165.520millionwasmadeinviolationofPara228and 229 of CPWA Code.

Project Director explained that for widening of roads, additional spaces / Land were acquired through District Collector / Deputy Commissioner, Kech. Process for acquisition has been completed and payment has already been made to the owners, accordingly. In this regard, a set of documents containing records of DistrictCollector,areavailableforverificationofaudit.

The Committee deferred the Para with directives that the payment made for acquisition of land by Project Director, City Development Project, Turbat for widening of roads/additional space,be verified from landownersand record theretobeprovidedtotheAuditforverificationunderintimationtoPAC.

PARA # 2.2.17: IRREGULAR / EXCESS PAYMENT – RS. 830.349 MILLION.

Audit observed that the Project Director, City Development Project Turbat, paid for different items of work by allowing excess quantities/rates then provided in the approvedPC-I/TechnicalSanctionestimatedduringtheyear2015-16duetothatanexcesspaymentofRs.0.570millionwasmadeinviolationofPara228and229of CPWA Code.

Project Director replied that installation of Hot Dipped Galvanized Iron Pole and Concrete Foundation are two different works in the nature therefore, two separate items of works were included in the B.O.Q/bid and resultantly, bidders quoted two separate rates for each item.

TheCommitteesettledtheParaonsatisfactoryjustificationoftheProjectDirector.

PARAS # 2.2.1 TO 2.2.20. (Meeting held on 21st October, 2019)

D.G Audit apprised the Committee that no Departmental Accounts Committee (DAC) meeting has been convened by the department on Audit Paras # 2.2.1 to 2.2.20. He further informed that thePrincipalAccountingOfficer (PAO)Communicationand Works department was requested in September 2017 to convene DAC meeting followedbythreereminders,butnoresponsewasreceivedtillfinalizationoftheAudit Report under discussion.

Committee expressed deep displeasure over the department for not holding the DAC meeting.

Additional Secretary C&W Department said that he was not aware of the constraints due to which the DAC meeting, on the Audit Report 2017-18, was not convened. Nevertheless, he requested the Committee to grant some time for holding DAC meeting, the decisions taken wherein would be submitted to PAC forthwith.

PAC DIRECTIVE(S) (21ST OCTOBER 2019):

On the request of department and recommendation of the D.G Audit, Committee directed that Departmental Accounts Committee (DAC) meeting is to be conducted on Audit Paras # 2.2.1 to 2.2.20 within 10 days under intimation to PAC.

Committee further directed the department that, in addition to the existing composition of DAC, two representatives of Public Accounts Committee i.e. Deputy SecretaryPACandChiefAccountsOfficerPACshallalsoattendthesubjectDACmeeting.

Moreover,thePrincipalAccountingOfficerwasdirectedtoattendensuingmeetingsof PAC in person. In case of failure, privilege motion will be moved against him in the Assembly.

BOARD OF REVENUE (Meetings held on 22nd October & 10th December, 2019)

INTRODUCTION

The major functions of the Board of Revenue include administration of land, land taxation, land revenue, preparation and maintenance of record pertaining to land ownership. It is the highest revenue court and custodian of rights in land of all right holders. Revenue Department exercises general superintendence and control over revenue courts in Balochistan.

The compulsory land acquisition in public interest under Land Revenue Act, 1967, territorial adjustments and disputes are also decided by this department. Stamps, judicial and non-judicial papers are also supplied by the Revenue Department.

BardofRevenueplaysaveryvitalrole inprovidingrelieftothevictimsofflood,earthquake and other natural disasters in the Province.

PAC OBSERVATIONS

During examination of Audit Report 2017-18, it was observed that most of the Audit Paras in Board of Revenue were related to the Irregular Expenditure, Recoverables and Non-Production of Record which depict weak and ineffective internal control system resulted from violation of Balochistan Public Procurement Regulatory Authority Rules 2014, Staff Car Rules 2000, Federal Treasury Rules, Standing Orders of Planning & Development Department and most importantly Article 170 (2) of the Constitution of Pakistan.

The second largest chunk of 19% represents recovery on account of Abiana, Usher, and Agriculture Income Tax under Abiana Rules 1999, Usher Assessment & Collection Rules 1994 and Land Revenue Act 1967 respectively.

3. Paras Settled 13

Total 16

Recoverables 19%

Paras Deferred

Paras Se�led

BOARD OF REVENUE 18

In the PAC meeting of the Board of Revenue held on 22nd October 2019 the Committee referred all of the Audit Para to the Special Departmental Accounts Committee (SDAC). On the basis of the decisions taken in SDAC meeting, Committee settled 13 (i.e. 81%) of the Audit Paras and rest of 3 were deferred with direction to the PrincipalAccountingOfficertoprovidetherelevantrecordtoAuditforverificationand recover the Balochistan Sales Tax on Services from the contractor on account of Catering Services. Compliance on the deferred paras will be taken in next PAC meeting of the department.

Rs. in Million

# Audit Observation No. of Paras Amount of Observation Recovery Effected

1. Irregular Expenditure 10 3,678.55 59.34

2. Non-Production of Record 02 5,020.66 -

3. Recoverables 03 238.69 -

Total 16 9,481.38 59.34

3,678.55

5,020.66

238.69

543.48

Recoverables

Rs. in Million

RecoveryofRs.59.34millionagainsttheIrregularExpenditurehasbeeneffected.Moreover,AuditParagraphsamountingtoRs.5,574.44million,pertainingtoNon-Production of Record, Unauthorized Expenditure, Recoverables and Irregular Expenditure were deferred by the Committee on which compliance will be taken in the next PAC meeting of the department.

Accountant General Balochistan briefed the Committee that only Non-Development budgetamounting toRs.3,476.71millionwasfinally granted to thedepartmentduringtheperiodunderdiscussion.HeexplainedthatsavingsofRs.745.35million,which amounts to 21.44% of total budget, was shown under the head of Salaries and Contingent expenditure.

Detail of the Appropriation Accounts is summarized below-

Rs. in Million

Head of Account

Original Grant

Supp. Grant Re-App. Surren-

derFinal Grant

Expendi-ture

Excess/ (Savings)

Development2,457.41 19.43 1301.97 302.105 3,476.71 2,731.354 (745.35) 21.44

Total 2,457.41 19.43 1301.97 302.105 3,476.71 2,731.354 (745.35) 21.44

Senior Member Board of Revenue requested the Committee to grant a 3 weeks period for convening DAC meeting on the agenda items. He suggested that DAC meetingwill filter-out the least important audit observations andwill leave theimportant and major issues for discussion at the august forum of Public Accounts Committee.

BOARD OF REVENUE 20

PAC DIRECTIVE(S) (22ND OCTOBER, 2019):

Discussion on both of the agenda items was deferred with directives that Special DAC meeting is to be held on Appropriation Accounts and audit Paras No.3.2.1 to 3.2.16 within 03 weeks under intimation to PAC. Committee further directed that, in addition to the existing composition of DAC, The Deputy Secretary PAC and Chief AccountsOfficerPACshallalsoattendtheDACmeeting.

REPLY OF THE DEPARTMENT ON 10TH DECEMBER, 2019:

Senior Member Board of Revenue apprised the forum that Finance Department allocated an amount of Rs. 3,436.7 million for Pay/Allowance & Contingences for Revenue Department in the financial year 2016-17 out of which Rs. 2731.354wereutilizedandRs.745.347wereinsavingsasthePay&Allowancesremainedunutilized on the account of vacant posts from BPS-1 to BPS-17 along-with the postsoffieldofficerswhichremainedvacantduringthesaidperiod.Thedepartmenttherefore, requested the Committee for regularizing the grant.

PAC DIRECTIVE(S) (10TH DECEMBER, 2019):

PACregularizedthegrants/figures&settledtheagendaitem#01withdirectivesthat the PAO shall ensure zero saving & excess, in future. It was also directed that infuture,fundskeptforvacantpostsbesurrenderedbeforethedeadlinefixedbythe Finance Department.

EXAMINATION OF AUDIT REPORT 2017-18

PARA # 3.2.1: NON-PRODUCTION OF RECORD – RS. 5019.060 MILLION.

AuditobservedthatthefollowingofficesofBoardofRevenueBalochistanincurredanexpenditureofRs.5019.060million,during2015-16,butdidnotproviderecordto audit for inspection as required under the rules:-

Rs. In Million

AIR Para No

Name of Office Particulars Amount

1. 01 DC, GwadarLand Acquisition for Free Trade Zone at Gwadar 2014-16

4,935.082

2. 02 DC, KachiChief Minister Discretionary grant (Khud e Rahim National party worker)

3. 02 DC, Kachi Compensation grant 15.25

4. 09 DC, Panjgoor Grant-in- Aid (Polio Charges). 11.425

5. 03 DC, Kohlu Record of establishment 38.424

6. 06 DC, Sherani Repair of educational institutes out of MPA 4.600

7. 10 DC, Quetta R/o Auqaf Masjid 2.305

8. 10 DC, Quetta Governor Fund 0.900

9. 03 DC, Chaghi Detail of account of sports activities Grant in Aid 7.000

10. 06 DC, ChaghiDetail of account of Expenditure from District Support Manager (PPHI)

Total 5,019.06

PrincipalAccountingOfficerapprisedthatfollowingthedirectivesofPAC,ameetingof the Special Departmental Accounts Committee (SDAC) was held on 11th November, 2019 to discuss the Audit observations. The decisions were taken against Audit Para for placing before this August Forum for endorsement & settlement. The PAO requestedtheForumforsettlementofParaonthebasisconcernedOfficers/DCs’justifications&decisionsoftheSDAC.

BOARD OF REVENUE 22

After detailed discussion, the PAC partially settled the Para and passed the followingDirectivesonthebasisofaforesaidSDACdecisions&justificationofthedepartment:-

1. ParadeferredpertainingtotheofficeofDCGwadarwiththedirectivethatnotonly the relevant record regarding this Para but also complete record of the recent overall allotments in Gwadar, shall be produced during the PAC visit to be communicated later.

2.ParasettledpertainingtotheofficesDCKachi,DCKohlu&DCSherani.

3. ParasettledsubjecttoverificationofRecordbyAuditwithinamonthpertainingtotheofficesofDCPanjgur,DCQuetta&DCChaghiunderintimationtothePAC.

PARA # 3.2.2: NON-PRODUCTION OF RECORD OF SECRET SERVICE FUND - RS. 1.600 MILLION.

AuditobservedthatthefollowingofficesoftheBoardofRevenue,drawnanamountof Rs. 1.600 million, on abstract contingent bills on account of Secret Service Fund, during 2014-16. However, record was not produced to audit for scrutiny:-

Rs. in Million

S. NoAIR Para No

Name of Office Purpose Year Amount

1. 08 Deputy Commissioner, Harnai

Secret Service

2014-15 0.200

2. 10 Deputy Commissioner, Barkhan 2014-15 0.400

3. 05 Deputy Commissioner, Jaffarabad 2015-16 0.200

4. 08 Deputy Commissioner, Quetta 2015-16 0.200

5. 08 Deputy Commissioner, Washuk 2014-15 0.400

6. 10 Deputy Commissioner, Kharan 2014-15 0.200

Total 1.600

PAO apprised the Committee about the decisions taken in the SDAC held on 11th

November, 2019 for placing before PAC for endorsement & settlement of Para on the basisconcernedOfficers/DCs’justifications&decisionsoftheSDAC.

The PAC endorsed the decisions of SDAC hence, settled the Para.

PARA # 3.2.3: LESS REALIZATION OF USHER – RS. 162.526 MILLION.

AuditobservedthatthefollowingofficesoftheBoardofRevenuedidnotrecoverUsher according to prescribed rates from Khatedars, during 2014-16, which resultedinshortrealizationofRs.162.526million:-

Rs. in Million

S.No. AIRPara No. Name of Office Year Amount

1. 05 Deputy Commissioner, Kalat 2015-16 1.187

3. 01 Deputy Commissioner, Kachi 2015-16 12.140

4. 11 Deputy Commissioner, Ziarat 2015-16 3.200

Total 162.526

PAO apprised the Committee about the decisions taken in the SDAC held on 11th November, 2019 for placing before PAC for endorsement & settlement of Para on the basisconcernedOfficers/DCs’justifications&decisionsoftheSDAC.

BOARD OF REVENUE 24

PARA # 3.2.4: NON/SHORT REALIZATION OF ABIANA RS. 74.697.

Audit observed that the Deputy Commissioner, Lasbela and Deputy Commissioner, JaffarabadofficesofBoardofRevenueBalochistan,during2015-16,Abianawaseither not recovered or short realized from the farmers of the concerned areas in disregard of rules.

Detail is summarized below-

Rs. in Million

S. No AIR Para No Name of Office Particular Amount

1. 2 Deputy Commissioner, Lasbela Short realization 35.949

2. 1 Deputy Commissioner, Jaffarabad Short realization 38.748

Total 74.697

PARA # 3.2.5: NON COLLECTION OF AGRICULTURE INCOME TAX - RS. 1.471 MILLION.

Audit pointed out that the Deputy Commissioner, Lasbela at Uthal recovered an amount of Rs. 0.078 million, against an outstanding balance of Rs. 1.471 million on account of “Agriculture Income Tax” from Zamindars of different Tehsils of District Lasbela,during2015-16inviolationof113to115ofLandRevenueAct,1967.

PARA # 3.2.6: UNAUTHORIZED PAYMENT ON ACCOUNT OF COMPENSATION OF MIRANI DAM RS. 543.480 MILLION.

Audit observed that the Deputy Commissioner Kech at Turbat, incurred an expenditure of Rs. 543.480 million on compensation to the affectees of MiraniDam,during2015-16,but landawardstatementandlandmutationdeedswerenot provided to audit. Further, amount was disbursed without maintenance of cash book and payees acknowledgement receipts.

PACdeferredtheParawithdirectivethattherelevantrecordbeverifiedbytheAuditwithin a month under intimation to the PAC for further consideration.

PARA # 3.2.7: ILLEGAL RETENTION OF PUBLIC MONEY- RS. 3,300.978 MILLION.

Audit observed that during 2014-16, the following offices of Board of Revenue,retained public money, which has been lying in the unauthorized bank accounts withoutanyjustification,inviolationofTreasuryRules290:-

BOARD OF REVENUE 26

Rs. in Million

AIR Para No Name of Office Year Amount

1. 05 Deputy Commissioner, Harnai 2014-15 42.923

2. 09 Deputy Commissioner, Pishin 2015-16 27.662

5. 03 Deputy Commissioner, Quetta 2015-16 2,761.989

6. 09 Deputy Commissioner, Washuk 2014-15 11.281

7. 01 Deputy Commissioner, Naseerabad 2015-16 10.000

8. 01 & 02 Deputy Commissioner, Kech 2015-16 202.736

9. 02 Deputy Commissioner, Panjgur 2014-16 54.877

11. 04 Deputy Commissioner, Noushki 2015-16 6.195

Total 3,300.978

PARA # 3.2.8: IRREGULAR EXPENDITURE ON MEDICAL TREATMENT - RS. 188.323 MILLION.

Audit observed that the Deputy Commissioner(s) Harnai, Pishin, Jaffarabad, Quetta, Chaghi and Kharan paid an amount of Rs. 188.323 million, during 2014-16, out of grant in aid placed at the disposal of concerned MPAs for medical treatment to the needy and poor people. The expenditure was held irregular because applications for medical reimbursement were not scrutinized by the committee, in majority of cases, open cheques were issued instead of cross cheques and medical documents were notverifiedbyconcernedhospitals.

Detail is summarized below-

Rs. in Million

S. No AIR Para No Name of Office Year Amount

1. 01 Deputy Commissioner, Harnai 2014-15 10.000

2. 02 Deputy Commissioner, Pishin 2015-16 1.335

4. 02 Deputy Commissioner, Quetta 2015-16 136.988

5. 02 Deputy Commissioner, Chaghi 2014-15 10.000

6. 04 Deputy Commissioner ,Kharan 2014-15 10.000

Total 188.323

BOARD OF REVENUE 28

PARA # 3.2.9: IRREGULAR EXPENDITURE WITHOUT OBTAINING ACCOUNTS – RS. 50.876 MILLION.

Audit pointed out that the following offices of Board of Revenue, withdrew anamountofRs.50.876million,during2014-16,forPoliocampaignonabstractbillsandpaidtodifferentofficesandorganizationswithoutobtainingdetailedaccountsin violation of Treasury Rules 308:-

Rs. in Million

AIR Para No Name of Office Purpose Year Amount

1. 06 Deputy Commissioner, Harnai Polio Campaign 2014-15 2.065

2. 05 & 07 Deputy Commissioner, Pishin Polio Campaign 2015-16 3.850

3. 08 Deputy Commissioner, Quetta Polio Campaign 2015-16 34.129

4. 04 Deputy Commissioner, Sherani Polio Campaign 2015-16 1.378

5. 07 Deputy Commissioner, Sibi Polio Campaign 2015-16 6.800

6. 02 Deputy Commissioner, Noushki Polio Campaign 2015-16 2.654

Total 50.876

PARA # 3.2.10: IRREGULAR PAYMENT OF SCHOLARSHIP OUT OF DEVELOPMENT FUNDS - RS. 46.970 MILLION.

AuditpointedoutthatfollowingofficesoftheBoardofRevenue,paidanamountof Rs. 46.970 million, during 2014-16, out of grant in aid placed at the disposal of concerned MPA’s for grant of scholarships to the deserving students:-

Rs. in Million

S. No. AIRPara No. Name of Office Year Amount

1. 08 Deputy Commissioner Jaffarabad 2015-16 20.000

2. 03 Deputy Commissioner Kharan 2014-15 10.000

3. 01 Deputy Commissioner Chaghi 2014-15 10.000

4. 12 Deputy Commissioner Panjgur 2014-15 6.970

Total 46.970

PAO apprised the Committee about the decisions taken in the SDAC held on 11th November, 2019 for placing before PAC for endorsement & settlement. The PAO requestedtheForumforsettlementoftheParaonthebasisconcernedOfficers/DCs’justifications&decisionsoftheSDAC.

PARA # 3.2.11: IRREGULAR EXPENDITURE ON PROCUREMENT OF GOODS - RS. 35.323 MILLION.

AuditpointedoutthatfollowingofficesofBoardofRevenue,incurredanexpenditureof Rs. 35.323million on purchase of uniforms, refreshment, vehicle repair andprocurementofotherstoreswithoutcallingopentendersinviolationofRule15ofBPPRA 2014:-

BOARD OF REVENUE 30

Rs. in Million

1. 05 & 07 Deputy Commissioner, Barkhan 2014-15 16.846

2. 06 & 10 Deputy Commissioner, Kech 2015-16 2.848

3. 03,05,06 Deputy Commissioner, Gwadar 2015-16 4.749

4. 04 Deputy Commissioner, Panjgur 2015-16 3.856

5. 09 Deputy Commissioner, Sherani 2014-16 1.563

6. 05 Deputy Commissioner, Kharan 2014-15 0.800

7. 02 & 03 Deputy Commissioner, Sibi 2015-16 4.127

Total 35.323

PARA # 3.2.12: IRREGULAR EXPENDITURE ON PURCHASE OF VEHICLE - RS. 21.924 MILLION.

Audit observed that the following offices of the Board of Revenue purchasedvehicles and their accessories valuing Rs. 21.924 million without observing rules and procedures framed by the government in violation of Schedule “A” Serial No. 3 of Balochistan Staff Cars Rules, 2000:-

Rs. in Million

Office Name of Suppliers Voucher No./Date Detail Amount

SMBR2015-16 Para

M/s Toyota Zarghoon

Motors

1119008, 15.06.2016

Toyota Land Cruiser Prado (Re-Condition) 5 Doors, 4000 cc, 6 Cylinder, TZ, G Selection Full Option Low Millage Domestic Model 2012

11.941

Deputy Commissioner,

Harnai2014-15

Para No.04

M/s Toyota Zarghoon Motors, Quetta

TZM/2054/15-26.05.2015

01 Toyota Hi-Lux Single Cab, converted into Ambulance

Cost of Fabrication and Ambulance Items along with STD warranty as per internal standard Delivery charges including insurance road risk and local bidding taxes etc.

TZM/2053/15-26.05.2015

01 Toyota Hi-Ace Std roof van ambulance, Model 2015 Japan Assembled, 2986

6.349Cost of Fabrication and Ambulance Items along with STD warranty as per internal standard

Total 21.924

BOARD OF REVENUE 32

PARA # 3.2.13: IRREGULAR EXPENDITURE AND NON-DEDUCTION OF TAXES – RS. 11.352 MILLION.

Audit observed that the Deputy Commissioner, Ziarat, incurred an expenditure ofRs.11.352million,during2015-16,oncateringservicesandfireworkswithoutcalling open tenders. Moreover, the firms submitted their claims on computergeneratedbillsinsteadofissuingpropersalestaxinvoicesinviolationof12.15&16of BPPRA rules. On scrutiny of the bills, no evidence of deposit of Rs. 1.643 million on account of BST and Income Tax in the Government account was available.

Detail is summarized below –

Rs. in Million

S. No. Firm Particulars Amount Income tax@ 6.5%

BST @15 %

1. Millat Tent QuettaCatering during Jashn -e- Ziarat

9.268 0.556 0.962

2.Lucky Haidery Fireworks Faisalabad

Fireworks during Jashn-e-Ziarat

2.084 0.125 -

Total 11.352 0.681 0.962

PAO apprised that SDAC directed to recover the Income Tax from the concerned contractors. In case of failure, Finance Department be approached to blacklist the saidfirms.

PAC deferred the Para with directive that Income Tax & BST be recovered from the Contractors before next meeting and compliance report thereof be sent to the PAC for further consideration.

PARA # 3.2.14: IRREGULAR EXPENDITURE ON REPAIR OF VEHICLE – RS. 8.050 MILLION.

Audit pointed out that in some offices of Revenue department, incurred anexpenditureofRs.8.050milliononrepairofvehicleswithoutinvitingopentendersand obtaining sanction from the competent authority during 2014-16 in violation of12.15&16ofBPPRArules.Furthermore,theamountwasdrawninthemonthof June to avoid the lapse of budget. Neither entries in logbooks were recorded nor were repair registers maintained. NOC from Agriculture Engineering Workshop was also not obtained. Detail is summarized below –

Rs. in Million

2. 01 Deputy Commissioner, Kalat 2015-16 0.700

3. 06 & 11 Deputy Commissioner, Quetta 2015-16 1.031

4. 07 Deputy Commissioner, Kech 2015-16 1.081

5. 07 Deputy Commissioner, Panjgoor 2014-16 3.086

Total 8.050

BOARD OF REVENUE 34

PARA # 3.2.15: IRREGULAR EXECUTION OF WORK ON NSR BASIS – RS. 2.998 MILLION.

Audit pointed out that the Deputy Commissioner, Panjgur, during 2014-16, executed some Water supply schemes in District (PB-42 and PB-43) valuing Rs. 2.998 million on NSR without preparing rate analysis and without obtaining approval of the competent authority. No report for the deviation from the scheduled items was given in the estimates, in violation of rule.

Detail is summarized below–

Rs. in Million

S. No. Name of Work Name of

ContractorCheque

No. Date Amount

1.Drilling and Development of Drinking Water Well / Bore at various places PB-42. 1st final bill

M/s Rukhshan Constt: Co.

295509 19-07-16. 0.488

2.Drilling and Development of Drinking Water Wells/ Bores at various places of PB-43.1st running bill.

M/s Hukaz Constt: Co.

Nil 03-08-16. 1.326

3.Drilling and Development of Drinking Water Wells/ Bores at various places of PB-43. 2nd and final bill.

M/s Hukaz Constt: Co.

295522 03-10-16. 1.183

Total 2.998

SMBR apprised that the SDAC recommended for settlement of Para subject to provision of rate analysis statements duly approved by DG, LGRD Balochistan to Audit.

PARA # 3.2.16: NON-ACCOUNTAL OF POL UTILIZATION – RS. 11.752 MILLION.

Audit pointed out that the following offices of Board of Revenue incurred anexpenditure of Rs. 11.752 million, on POL charges of different vehicles during2014-16, without maintaining logbooks in violation of Clause 11(2) of Balochistan Staff Car Rules, 2000:-

Rs. in Million

S. No AIR Para No Name of office and District Period Amount

1. 05 Deputy Commissioner Lesbela at Uthal 2015-16 7.212

2. 09 Deputy Commissioner Harnai 2014-15 0.676

3. 07 Deputy Commissioner Kech at Turbat 2015-16 3.223

4. 12 Deputy Commissioner Quetta 2015-16 0.641

Total 11.752

BOARD OF REVENUE 36

HEALTH DEPARTMENT(Meetings held on 2nd July & 12th December, 2019)

INTRODUCTION

The main purpose of the Health Department is to provide health facilities to the people of Balochistan by taking measures for prevention and control of infectious and contagious diseases and providing improved treatment facilities for the public health. For this purpose, the Department maintains hospitals at district level, Rural Health Centers, Basic Health Units and Dispensaries at Tehsils & villages.

PAC OBSERVATIONS

While examining Audit Report 2017-18, it was observed that most of the Audit Paras in Health Department were related to the Irregular Expenditure and Overpayments which depict weak and ineffective internal control system in the department and in theofficeoftheAccountantGeneralBalochistan.

The most dominant and burning issue in the Health Department was pertaining to the purchase of Oxygen Gas at exorbitant rates. This matter had already been referred to the National Accountability Bureau (NAB) by the ex-Public Accounts Committee.Therefore,thecurrentPACholdsitsdecisionontheissuetillfinalizationof the NAB’s inquiry.

Recoverables9%

Overpayment18%

4. Paras Settled 02

Total 11

(55%)oftheAuditParasweresettledsubjecttoconditionsofrecovery,installationof residential Electricity Meters at the Colony of Sheikh Khalifa Bin Zayyed Al-NahyanMedicalComplexQuettaandverificationofrecordbytheofficeoftheD.GAudit Balochistan under intimation to PAC.

(27%)oftheAuditParasweredeferredtillthefinalizationofNAB’sinquiryintothematter of purchase of Oxygen Gas at exorbitant rates and production of record (as detailedinensuringpages)totheAuditforverification.

Moreover,(18%)oftheAuditParasweresettledafterverificationofrecoveryChallanby D.G Audit Balochistan and commitment of the Medical Store Department, Quetta to ensure purchase of quality medicine, in future.

Paras Deferred

Paras Se�led Subject toCondi�onParas Se�led

HEALTH DEPARTMENT38

Rs. in Million

# Audit Observations No. of Paras

Recovery Effected

1. Irregular Expenditure 03 486.75 28.08

2. Non-Production of Record 01 9.24 -

5. Overpayments 02 6.21 -

6. Evasion of Taxes & Duties 01 4.01 -

7. Doubtful Expenditure 01 1.13 1.13

8. Loss Sustained by the Govt. 01 14.58 -

Total 11 528.49 29.21

Audit Paras amounting to Rs.63.98 million have been settled by the Committee subject to recovery,verificationof recordandsomeotherconditions (detailed in

486.75

Recoverables

Overpayments

Rs. in Million

next pages). Whereas, Audit Paras amounting to Rs.368.46 million, pertaining to officeof theChiefExecutiveOfficer,PeoplePrimaryHealthCareInitiative (PPHI)Balochistan(Non-renderingofVouchedAccounts),DistrictHealthOfficerHarnai(Non-Production of Record) and Medical Superintendent Bolan Medical Complex Hospital Quetta (Exorbitant rate of Oxygen Gas) were deferred for checking compliance thereon in the next PAC meeting of Department.

EXAMINATION OF APPROPRIATION ACCOUNT FOR THE YEAR 2016-17

PAC DIRECTIVE(S) (2ND JULY 2019):

On the recommendation of A.G, Balochistan and subject to provision of Replies to PAC& A.G, BalochistanOffice, the Parawas deferred till nextmeeting. TheCommitteealsodirectedthatthePrincipalAccountingOfficerofHealthDepartmentshall make his presence in the ensuing meeting, as and when held.

Deputy Accountant General Balochistan, briefed the Committee about the Appropriation Accounts that the Health Department has not provided any reasons/justificationofhugesavingsamountingtoRs.562.03millionshownunderdevelopmentfunds.TheSupplementaryGrantamountingtoRs.5,797.00million,on the request of the department under development head, was allocated in the month of April and May 2017, which if not allocated, would have been available for other fruitful and useful purposes. Appropriation Account of the Department is summarized below–

Rs. in Million

Head of Account

Original Grant

Supp. Grant

Surren-der Final Grant Expendi-

tureExcess/

(Savings)%

Non-Development

- - - 14,856.70 14,986.60 129.90 0.87

Development - - - 7,013.00 6,451.78 (562.03) 8.01

Total - - - 21,869.70 21,438.38 (431.32) 1.97

HEALTH DEPARTMENT40

PAO/Secretary Health Department in his reply apprised the Committee that the Finance Department, Government of Balochistan, notified Health ProfessionalAllowance vide Notification No. FD(R-I)(II-42)/Dr/2016/2109-2230, dated: 10th November, 2016, for Medical Officer, Specialist, General & Management Cadreserving across the Province. The excess amount of Rs. 121.90 million incurred because of the fact that HPA was notified in the midst of the financial year,2016-17.

Regardingdevelopmentbudget,PAOexplainedthattheamountRs.562.03millionwas released to executing agency for its utilization in carrying out the developmental work of Health department across the Province. The Non-utilization was on the part of the executing agency and may be called in for questioning. Hence, he requested the Forum that on the basis of aforementioned justification, the agenda itempertaining to the Appropriation Accounts of the department, may please be settled.

ThePACregularizedthegrants/figure&settledtheagendaitem#01pertainingto the Appropriation Accounts of Health with directive that the PAO shall ensure timely submission of saving & excess, in future.

Audit pointed out that the Project Coordinator, Extended Program for Immunization Quetta, released funds amounting toRs.9.236millionduring the financial year2015-16fortheroutinepoliovaccinationtotheDistrictHealthOfficesofthefollowingdistrictsbutnorecordwasproducedtotheauditforverificationinviolationoftheConstitution of Islamic Republic of Pakistan:-

Rs. in Million

S. No District Amount1. Awaran 2.0712. Dera Bugti 1.7803. Harnai 0.6214. Jhal Magsi 1.0405. Kohlu 1.3186. Musa-Khail 1.0637. Loralai 1.343

Total 9.236

The Department admitted negligence on its part and apprised that DHO Harnai & DHO Loralai who have not provided the record, have been suspended and their Charge Sheets are being processed for necessary actions. The DHO Loralai, after suspension orders, provided the record. Whereas, the sitting DHO Harnai claimed that the Ex-DHO Harnai, currently working as Deputy Medical Superintendent, Bolan Medical Complex Hospital, has taken the record with himself.

Charge-Sheet may be issued, as soon as possible, against Ex-DHO Harnai, currently working as Deputy Medical Superintendent, Bolan Medical Complex Hospital Quettawhohastakenofficialrecordwithhimselfaftertransfer.Additionally,ifnotresponded to the charge-sheet, F.I.R shall be logged against him within one week under intimation to the PAC. Para stands.

Department apprised that the relevant record pertaining to Awaran, Dera-Bugti, Jhal-Magsi, Kohlu, Musakhail & Loralai districts have been submitted to audit for verification.FinalremainderhasbeenissuedtotheEx-DHOHarnaiforfurnishingthe record. However, the concerned DHO is failed to submit the said record. As

HEALTH DEPARTMENT42

per directives of PAC, the Health department has issued a charge-sheet to Ex-DHO Harnai currently working as Deputy Medical Superintendent, Bolan Medical Complex Hospital Quetta.

PAC partially settled the Para pertaining to the DHOs Awaran, Dera Bugti, Jhal-Magsi, Kohlu, Musakhail & Loralai but PAC deferred the Para pertaining to DHO Harnai with directive that the PAO shall make sure recovery of relevant record & due amount within 2 months under intimation to PAC for further consideration.

PARA # 4.2.2: MISAPPROPRIATION OF GOVERNMENT RECEIPT RS. 1.128 MILLION.

Audit pointed out thatMedical Superintendent, 50 bedded JamGhulamQadirKhan Hospital, Hub, realized receipt amounting to Rs.1.728 million during 2012-17 on account of user charges. Out of total receipts, Rs. 1.128 million was not deposited into the government treasury in violation of Para 23 of GFR Vol-I.

Department could not produce relevant record before the Committee. Resultantly, the Committee expressed extreme reservations against ill preparation, incomplete documents/record, non-satisfactory answers, and inefficiency of the HealthDepartment.

The Committee decided that in next meeting, duly verified copy of the receiptfor depositing of Rs.1.128 million in government exchequer, must be produced. Otherwise, Privilege Motion shall be moved in the House against the department for misleading the Committee. Para stands.

The Department apprised that the amount Rs. 1.128 million has been deposited andcopiesofdepositedChallan&originalrecordisavailableforverification.Itistherefore, requested that Para may kindly be dropped.

AfterverificationofthedepositedChallanbyAudit,PACtherefore,settledthePara.

PARA # 4.2.3: OVERPAYMENT DUE TO WRONG CALCULATION ON STEEL ITEMS – RS. 3.412 MILLION.

Audit pointed out that the Project Director “Construction of Medical College at Loralai”, awarded the work to the contractor on 27th June 2016. A sum of Rs. 6.232 million was paid on account of steel items whereas, calculations revealed that gross workpaidonaccountofsteelitemscomestoRs.5.152million.Thus,duetowrongcalculation, contractor was overpaid Rs. 3.412 million, in violation of CPWA Code 16 and 221.

Project Director, construction of Medical College at Loralai, explained that due to the expiry of deadline set by the PAC, 30 copies couldn’t have been submitted to the auditasreplies/workingpapersweresubmittedintheofficeofSecretaryHealthabit late. He therefore, requested the forum for deferment of discussion on this Para till next meeting of PAC.

The request of the Project Director was accepted hence, Para was deferred till ensuing meeting, as and when held with the directive that Principal Accounting Officer(PAO)shallexplaintheissuebeforeCommittee.

HEALTH DEPARTMENT44

Department submitted that for the year 2013-14, the audit party pointed out erroneous calculation on steel items. Calculation sheet relating steel items as per specificationallowedbytheP&DDepartmentwerepaidtocontractoraccordinglyhence the question of over payment does not arise in this regard. The department requested PAC for settlement of the Para.

Committee settled the Para subject to verification of relevant record by Auditunder intimation to PAC.

PAC also directed the PAO & Project Director, “Construction of Medical College at Loralai” to arrange for PAC a physical visit of the Medical College at Loralai in the month of January, 2020. Date for the said visit will be communicated later.

PARA # 4.2.4: OVERPAYMENT DUE TO EXORBITANT RATE OF OXYGEN GAS RS. 2.80 MILLION.

Audit pointed out that in violation of Section 43 of BBPRA Rules 2014, Medical Superintendent Bolan Medical Complex Hospital Quetta, incurred an expenditure ofRs.7.179million,during2015-16onpurchaseofOxygenGasonhigher thanmarketrates.During2014-15OxygenGaswasfilled@Rs.1050/-percylinderof240Cftbutduring2015-16,thesamesupplierwaspaid@Rs.1,150/-percylinderof 240 Cft, which was extraordinarily high.

Department contrary to the Audit observations, explained that currently they are purchasing the same cylinder between the range of Rs. 370 and Rs. 400. While justifying its case, department added that as the competition in the oxygen gas industry has been increased, therefore, the oxygen gas is now easily available at verylowratescomparedto2015-16and2016-17.

Duetounsatisfactoryjustificationbythedepartment,CommitteedeferredtheParatill next PAC meeting.

Department explained that matter was referred to the NAB by then PAC for investigation, therefore, the case is under investigation with NAB. However, information into the matter has been obtained from concerned hospital, resultantly; the Health Department has blacklisted the concerned Firm.

CommitteekepttheParaonholdtillfinalizationoftheNABinquiry.

PARA # 4.2.5: LOSS DUE TO PURCHASE OF MEDICINES AT HIGHER RATE RS. 14.584 MILLION.

Audit observed that the Additional Director, Medical Store Department, Quetta purchasedmedicinesamountingtoRs.24.701million,during2015-16,byignoringlowest rates without giving solid reasons for accepting higher rates, due to which theGovernmentexchequerwasputintolossofRs.14.584millioninviolationofPara 19 (vi) of GFR Vol. I.

Department explained that drugs in question were purchased as per terms and conditions of the tender documents. The relevant documents have already been verifiedbytheaudit.

Onjustificationofdepartment,PACsettledtheParawithdirectivesthatthePAOshall ensure provision & purchase of Quality Medicine, in future.

HEALTH DEPARTMENT46

PARA # 4.2.6: UNAUTHORIZED PAYMENT OF ELECTRICITY CHARGES OF GOVERNMENT RESIDENCES -RS. 1.443 MILLION.

Audit observed that the Executive Director Sheikh Khalifa Bin Zayyed Hospital, QuettaincurredanexpenditureofRs.10.00million,during2015-16,onaccountof electricity, consumed by hospital and adjoining residential colony. Due to non-installation of separate electricity meters for the residential quarters and non-recovery of electricity charges, government exchequer was put into a loss amounting to Rs. 1.443 million in violation rule 16 (vii) of Balochistan Residential Accommodation Rules 1982.

Department explained that the recovery has been affected from allottees on monthly basis and an amount of Rs. 136,000/- Paid to the QESCO and an amount of Rs79,800/deposited in Government Treasury. In this regard, Chief QESCO has been approached for bifurcation/separation of meters in light of the meeting held for the purpose.

The Committee settled the Para with directives that the PAO shall take up the matter personally with the Chief QESCO for installation of residential electricity meters in the colony of Sheikh Khalifa Bin Zayyed Al-Nahyan Medical Complex Quetta.

PAC also directed QESCO Chief to expedite the process and cooperate with the Secretary, Health department for the purpose.

Compliance report thereof be sent to the PAC within 2 months.

PARA # 4.2.7: NON-DEDUCTION OF HOUSE RENT AND CONVEYANCE ALLOWANCE - RS. 5.137 MILLION.

Audit pointed out that in Sheikh Khalifa Bin Zayyed Hospital Quetta, an amount

ofRs.5.137millionwaspaidonaccountofhouserentandconveyanceallowanceduring2015-16,totheofficialsresiding ingovernmentaccommodationprovidedby the hospital in the same premises. Payment of house rent allowance to those allotted with government accommodation and conveyance allowance to those residing in hospital premises was violation of prevailing rules.

Department submitted that the recovery of House Rent and Conveyance Allowance has been started and Change Form-3 is being submitted to the office of theAccountant General Balochistan on monthly basis in 20 installments as per directives of the Audit. It is therefore, requested that Para may be dropped, please.

PAC settled the Para with directives that the PAO shall ensure completion of remaining recovery and compliance report thereof be sent to PAC.

PARA # 4.2.8: NON DEDUCTION OF BALOCHISTAN SALES TAX - RS.4.008 MILLION.

AuditpointedoutthatviolationofBalochistanSalesTaxonServicesAct,2015,theMedical Superintendent, Bolan Medical Hospital Complex, Quetta paid Rs. 26.73 million,during2015-16,tocontractorsonaccountofservicesrenderedtoHospital.Balochistan sales tax on services was not deducted from contractors, resulting into a loss of Rs. 4.008 million to the public exchequer.

Department explained that the case is under investigation with the CMIT. Health DepartmenthasalreadyblacklistedtheFirmsandtheliabilitiesofconcernedfirmsamounting to Rs. 184.000 million are laying in the Government. As and when the FinanceDepartmentsanctionstheamountinthefavorofthefirms,thisofficewillrecover the BST, forthwith.

HEALTH DEPARTMENT48

PAC settled the Para subject to completion of recovery and with directives that the PAO shall withdraw blacklisting of Firms after 100% recovery. Compliance report thereof be sent to PAC for record/authentication.

PARA # 4.2.9: INADMISSIBLE DRAWL OF RURAL INCENTIVE ALLOWANCE RS. 6.014 MILLION.

AuditpointedoutthattheMedicalSuperintendent,50-BeddedJamGhulamQadirKhan Hospital, Hub, paid an amount of Rs. 6.014 million, during 2014-16, as “Rural Incentive Allowance” to doctors who were posted in the hospital instead of peripheryinviolationofHealthDepartmentorderNoSO(B)9-49/2011-12/25474-580datedSeptember17,2011.

Department shared that on recommendations of Audit, recovery is being affected. Therefore, Para may kindly be dropped.

PAC settled the Para with directives that the PAO shall ensure affecting of remaining recovery and compliance report thereof be sent to the PAC.

PARA # 4.2.10: ILLEGAL RETENTION OF GOVERNMENT MONEY - RS. 43.965 MILLION.

Audit pointed out that the Additional Director, Medical Store Department Balochistan,Quetta,retainedRs.43.965million,during2015-16,inviolationofrule in NBP as on June 30, 2016. It was not known as to how and when the money was drawn and for which purpose in violation of Para 290 of FTR.

The department explained that the account No.4002783891 National Bank of PakistanisanofficialaccountwiththefactsthattheGrandTotaldepositedthroughdifferent Challans = Rs.28,077,182/-. The remaining amount has been disbursed as per Government Rules to the contractors.

PAC settled the Para subject to verification of relevant record by Audit underintimation to the PAC.

PARA # 4.2.11: NON RENDERING OF VOUCHED ACCOUNT - RS. 436.766 MILLION.

Audit pointed out that the Secretary, Health Department, Balochistan, Quetta drew anamountofRs.436.766million,during2015-16,onabstractcontingentbillsandpaid to the institutions mentioned below but no adjustment account was available for audit scrutiny–

Rs. in Million

S.No. Name of Office Cheque No./Date Description Amount

1.Chief Executive Officer, Peoples Primary Health care Initiative Balochistan PPHI

1071924/01.01.2016

Grant in Aid for salaries, contingency and Medicines

364.362

2.Grant in Aid for salaries of focal person

3.Quetta Institute of Medical Sciences

201680% share of Subsidized Fees of 79 Students

35.480

4.Commandant CMH, Quetta

1071633/29.12.2015 Medical Treatment for

victims of Terrorist activities

30.700

5.1100247/

01.12.20160.409

6.Agha Khan Hospital Karachi

1044514/29.10.2015

No details 5.000

HEALTH DEPARTMENT50

S.No. Name of Office Cheque No./Date Description Amount

7.Agha Khan Hospital Karachi

1070454/24.11.2015

Medical Treatment 0.148

Total 436.766

Department explained that correspondence with the CEO (PPHI), QIMS, Commandant, CMH, Quetta, and Dean Agha Khan Hospital, Karachi, have been made. However, their reply is still awaited. All vouchers concerned are lying in the abovementionedofficeswhichmaybeexaminedoverthere.

The Committee settled the Para pertaining to the Commandant CMH, Quetta & Agha Khan hospital.

The Committee deferred the Para pertaining to Chief Executive Officer, PeoplesPrimary Healthcare Initiative Balochistan (PPHI) & Quetta Institute of Medical Sciences (QIMS) with directives that the PAO shall take up the matter personally with PPHI and also follow the case up properly in the Court.

SERVICES & GENERAL ADMINISTRATION DEPARTMENT

(S&GAD)(Meetings held on 24th September & 11th December, 2019)

INTRODUCTION

The Services & General Administration Department holds a key position in the provincial administration. It deals with all postings, transfers, appointments, promotions and allied service matters of Balochistan Government. It also manages VIP Flats, Bachelor Hostels Quetta and Balochistan House Islamabad and Karachi.CivilEstateOfficer,ChiefPilot,Anti-CorruptionandServiceTribunalaresubordinateofficeofthedepartment.

PAC OBSERVATIONS

In the examination of Audit Report 2017-18, it was pointed out by the Committee that 53% of the Audit Paras in Services &General Administration Department(S&GAD) were related to the Irregular Expenditure which explicitly demonstrates non-adherence to the rules, regulations, policies and procedures enacted by the legislature from time to time. Although, Irregular and Unauthorized Expenditure do not necessarily recommend recovery, but, the irregularities badly affect the efficiencyandeffectivenessof thebusinessofGovernment toachieve itsdesiredobjectives.

Other remarkable issues observed in department by the Committee were irregular paymentofAirPassageChargesandSpecialAllowance@50%onrunningpaytononBalochistanDomiciledAPUGofficerspostedinBalochistanandreluctanceofthe Chief Pilot Governor Aircraft to appear before the Committee for discussion of 6 AuditPararelatedtohisoffice.

SERVICES & GENERAL ADMINISTRATION DEPARTMENT (S&GAD)52

3. Paras Settled 10

Total 19

Astherecoverieshavebeeneffected,dulyverifiedbyD.GAuditBalochistan,anddepartment committed to adhere to the rules, regulations, policies and procedures

Recoverables16%

Paras Deferred

Paras Se�led

of the Government in future, therefore, the Committee settled 10 audit paras. However, rest of the Audit Paras were deferred on which compliance will be taken in next PAC meeting of the department.

Furthermore, the Principal Secretary to Chief Minster Balochistan was directed to take strict disciplinary action against the Chief Pilot Governor Aircraft for not appearing before the Public Accounts Committee.

Rs. in Million

# Audit Observation No. of Paras Amount of Observation

Recovery Effected

1. Irregular Expenditure 10 425.60 2.122. Non-Production of Record 02 48.76 -3. Recoverables 03 9.59 2.514. Unauthorized Expenditure 01 46.74 -5. Doubtful Expenditure 02 3.06 -6. Loss Sustained by the Govt. 01 1.68 1.68

Total 19 535.43 6.31

425.60

Recoverables

Rs. in Million

Recovery of Rs.6.31 million has been effected. Rest of the Paras were differed with the directive to recover the remaining amount.

EXAMINATION OF APPROPRIATION ACCOUNTS FOR THE F.Y 2015-16

The Deputy Accountant General Balochistan briefed the subject Appropriation Accounts before Committee as under–

Rs. in Million

Head of

Account

Original

GrantRe-App.

Surren-

Expendi-

Excess/

(Savings)%

QA4004 Maintenance of Governor Aircraft

1,821.19 - 9.27 - 1,830.46 104.21 (1,726.25) 94.31

QA4005 S&GAD

670.75 - 107.50 - 778.25 758.44 (19.81) 2.55

QA4006 Minister & their Staff

303.18 - 69.74 - 372.92 353.06 (19.86) 5.33

QA4007 Civil Estate Office

20.89 - (0.52) - 20.38 16.71 (3.66) 17.98

QA4008 Balochistan House Islamabad

114.38 - 11.58 - 125.95 101.71 (24.24) 19.25

QA4009 Others

14.24 - 0.01 - 14.25 12.68 (1.57) 11.01

QA4015 Anti-Corruption Est.

79.00 - (18.81) - 60.20 44.67 (15.53) 25.80

Total 3,023.63 - 178.77 - 3,202.41 1,391.48 (1,810.92) 56.55

SUMMARY REGARDING BUDGET & EXPENDITURE (BALOCHISTAN HOUSE KARACHI) OF S&GAD

DEPARTMENTFORTHEF.Y2015-16(NON-DEVELOPMENT)

Rs. in Million

Head of AccountOriginal Grant

Supp. Grant

Re- App.Surren-

derFinal Grant

Expendi-ture

Excess/ (Savings)

QA5227

Balochistan

House Karachi

3,464.00 - (443.00) - 3,021.00 2,264.39 (756.61) 25.04

DDOs Department Reply PAC Directives(September 24, 2019)

(QA4004 Maintenance of Governor Aircraft

Chief Pilot, Governor Aircraft explained that aforesaid budget was required for the repair, maintenance, and fuel charges of the Aircraft. He added that as the exact usage of Aircraft can’t be forecasted therefore 94.31% of the budget was surrendered during the F.Y 2015-16.

Committee deferred discussion on the issue with directive that the breakup of budget under “QA4004 – Maintenance of Governor Aircraft” along with actual expenditure, for the last 10 years, is to be submitted to PAC Secretariat within 02 months.

QA4007 Civil Estate Office

Secretary S&GAD informed the Committee that only few official visits were performed during F.Y 2015-16, therefore, savings of 19.25% were shown.

Committee did not accept the justifications of department and deferred the discussion on the Appropriation Accounts with the directives that the A.G Balochistan shall issue circular regarding preparation of replies to all the PAO under intimation to PAC.

QA4008 Balochistan House Islamabad

Secretary S&GAD explained before the Committee that the visits of Parliamentarians can’t be forecasted accurately, therefore, excesses and surrenders occur.

QA4015 Anti-Corruption Establishment

Secretary S&GAD explained that most of the savings were shown in Pay & Allowances due to vacant posts. He added that the project for filling the vacant posts have been given to Testing Agency. Therefore, in future, such savings will not be shown.

DDOs Department Reply PAC Directives(September 24, 2019)

QA5227

Balochistan

House Karachi

Secretary S&GAD informed that the budget

was basically required for the procurement of

Vehicles.

Committee pointed out that the figures

provided by A.G Balochistan in Appropriation

Accounts of Balochistan House Karachi

seems incorrect.

A.G Balochistan admitted the typing/

typographical mistake.

Committee deferred the discussion on

Appropriation Accounts of Balochistan House

Karachi with directive that Secretary S&GAD

and Finance Department shall reconcile the

Appropriation Accounts with A.G Balochistan

within 02 months under intimation to D.G

Audit and PAC.

The PAO apprised that as per revised budget estimates, the original grant of Balochistan House Karachi was Rs.3,021,000/- while the majority of the surrender/saving amount relates to utilities i.e. Telephone, Gas, Water & Electricity etc. therefore, the forum is requested for settlement of the agenda and ensured that department would take every possible measure to minimize the saving/excess.

ThePAC regularized the grants/figurepertaining to theAppropriationAccountsof S&GAD with directive that the PAO shall ensure timely submission of saving & excess, in future.

PARAS # 5.2.1, 5.2.11 TO 5.2.13, 5.2.16 & 5.2.18 AR 2017-18

(CHIEF PILOT, GOVERNOR AIRCRAFT, QUETTA)

As the working papers relating to Chief Pilot, Governor Aircraft office were notsignedbythePrincipalAccountingOfficer.Therefore,ChiefPilot,GovernorAircraftrequestedtheCommitteethatdiscussionontheauditParasrelatedtohisofficemay be deferred.

PAC DIRECTIVE(S) (SEPTEMBER 24, 2019):

Committee accepted the request of Chief Pilot, Governor Aircraft, and deferred discussiononPara#5.2.1,5.2.11to5.2.13,5.2.16,and5.2.18withdirectivethatworking papers related to aforementioned Paras, complete in all respects, shall be submitted in PAC Secretariat within two months i.e. by 23rd November, 2019.

The Secretary S&GAD explained that the Chief Pilot is now under the administrative control of Principal Secretary to the Chief Minister Balochistan. However, while these observations were pointed out & Paras were printed in the Audit Report 2017-18,theSecretary,S&GADwashisPrincipalAccountingOfficer.PAOfurtherinformed that the Chief Pilot had been approached many times for the purpose but he didn’t respond positively. The Pilot concerned was invited to attend the DAC meeting but he didn’t bother to attend even that meeting.

PAC Expressed deep concerns over the absence of Chief Pilot hence, decided that if the Pilot concerned didn’t obey the directives of PAC, the Paras will be decided ex-party.

The Committee deferred the Paras # 5.2.1, 5.2.11 to 5.2.13, 5.2.16 & 5.2.18 and passed the following directives:-

• Principal Secretary to the Chief Minister Balochistan, being the Authority, shall take strict disciplinary action against the Chief Pilot for not attending the PAC meeting.

• Secretary S&GAD, being the then PAO of Chief Pilot, shall ensure his presence in the ensuing meeting of PAC.

• Compliance report thereof be sent to the PAC for further consideration.

PARA # 5.2.2: NON-PRODUCTION OF SECRET SERVICE FUNDS AND CASH DISBURSEMENT RECORD – RS. 8.553 MILLION.

Audit observed that the Secretary, S&GAD Balochistan, drew an amount of Rs. 1.300 million on abstract contingent bill on account of Secret Service Fund vide ChequeNo.1023039dated30.07.2015butnorecordwasproducedtoauditforscrutiny.Also,numerouschequesamountingtoRs7.253millionweredrawninfavor of DDO but vouchers against the relevant drawls were not produced for audit, in violation of Para 17 of GFR Vol-I, read with Section-14(2) of Auditor-General’s (Functions, Power and Terms and Conditions of Service) Ordinance, 2001.

Secretary S&GAD explained that the Secret Service Funds are meant for secret services rendered by the services of individuals for strengthening the Government and State. Reasonable amounts were paid to individuals as a reward for their secret services without disclosing their names due to expected threats to their families and properties. The observation of audit could not be complied under the prevailing law and order situation.

Para was settled subject to avoidance of such practice in future.

PARA # 5.2.3: MISAPPROPRIATION ON PURCHASE OF UNIFORMS – RS. 2.112 MILLION.

Audit observed that the Comptroller, Balochistan House, Islamabad incurred an expenditure of Rs. 2.112million, during 2014-15, on purchase of uniforms forclass-IV staff in violation of Para-23 of GFR Vol-I.

Secretary S&GAD explained that an amount of Rs. 2.112 million was incurred on purchase of uniforms for entitled employees of Balochistan House Islamabad, after completion of all codal formalities.

The Committee settled the Para with the directives that, in future, the purchase amount for Uniform (Livery) may be re-appropriated as Uniform Allowance to the concerned employees.

PARA # 5.2.4: MISAPPROPRIATION ON ACCOUNT OF PURCHASE OF SEA FOOD – RS. 0.944 MILLION.

Audit observed that the Secretary S&GAD Quetta paid an amount of Rs. 0.944 millionduring2015-16,toM/sSadafResortGwadaronaccountofsupplyofseafood to PC Hotel Gwadar on the eve of one day seminar. the payment was made by the S&GAD in cash whereas the bill was addressed to the PC Hotel therefore, audit suspects that the bill was attached with the detailed account in order to misappropriate the public money which violates Paragraph 23 of GFR, Vol-I.

Secretary S&GAD explained that the expenditure was incurred during a Seminar held in Gwadar and attended by 900-1000 participants amongst highest dignitaries of the state. PC Hotel Gwadar did not have capacity to serve lunch having different Sea Food, therefore, Sadaf Resort was requested to provide some Sea Foods to the officialguestduringtheseminarastheratesofSeaFoodofferedbySadafResortwere more economical than the PC Hotel.

Para was settled.

PARA # 5.2.5: UNAUTHORIZED PAYMENT OF CASH AWARDS – RS. 46.736 MILLION.

Audit observed that The Secretary, S&GAD Quetta incurred an expenditure of Rs. 46.736 million on account of honorarium and cash awards to the employees of S&GAD and employees of attached departments working in Civil Secretariat, in violation of SOPs issued by The Finance Department vide letter No.FD(R-I)/II-II/2015/1243-1343dated:08.05.2015.

Rs. in Million

Name of DDO Description Expenditure

QA-4005-S&GAD Honoraria 7.587

QA-4005-S&GAD Cash Awards 30.750

QA4006-Ministers & their Staff Cash Awards 7.592

QA4009-VIP FLATS Cash Awards 0.807

Total 46.736

SecretaryS&GADexplainedthatofficialworkingpattern/procedureofProvincialSecretariatisdifferentfromotherofficesofProvince,because,mostofthestaffcan’tleavetheirofficesuntilMinistersaresitting.HeaddedthatwithpriorapprovaloftheChief Minister Balochistan through a summary, the Finance Department directed the Accountant General Balochistan for payment of Cash Award to the employees of Governor Secretariat, Chief Minister Secretariat and attached employees who perform duties in Balochistan Secretariat.

Para was settled with directives that, in future, the matter be streamlined as per rules.

PARA # 5.2.6: LOSS DUE TO RENTS AGAINST OCCUPANTS OF G-8/4 FLATS – RS. 1.679 MILLION.

Audit observed that the Secretary S&GAD, Balochistan failed to recover Rs. 1.679 million,during2014-15,onaccountofrentsoftheG-8/4flats,whichremainedoutstanding since long against the occupants of the family suites and bachelor’s rooms, causing loss to the Government in disregard of Rule-7(I) of Treasury Rules.

Secretary S&GAD explained that the following amount has been recovered from defaulters and deposited into NBP Civil Secretariat Branch Quetta:-

Rs. in Million

S. No. Challan No. Date Amount

1. Nil 11-08-2016 1.177

2. Nil 04-07-2017 1.921

Total deposited in above referred NBP Branch 3.098

Para was settled.

PARA # 5.2.7: NON ACHIEVEMENT OF REVENUE TARGET RESULTING IN SHORTFALL - RS. 25.655 MILLION.

AuditobservedthattheSecretaryS&GADhadarevenuetargetofRs.57.983millioninthebudgetestimatesof2015-16underobjectheadC038-Others,whereas,therealized amountwasRs. 32.328million resulting into a shortfall of Rs. 25.655million in violation of GFR 26.

Secretary S&GAD explained that the Standing Committee of the Balochistan Provincial Assembly on S&GAD, after approval of the Parliamentary Session of Balochistan Assembly recommended cancellation of enhanced rates and restoration of the previous rates, as a result this department could not achieve the desired results. Moreover, S&GAD has enhanced rates of government Guest House Ziarat from Rs.500/- to Rs.1500/- per day and also fixedmonthly utility charges forRs.8,000/-ontheallotteesofOfficerClubandBungalowatCantonmentarea.

Para was settled.

PARA # 5.2.8: NON-RECOVERY OF GOVERNMENT DUES – RS. 5.754 MILLION.

Audit observed that in Balochistan House, Islamabad, Government receipts amountingRs.5.754milliononaccountofRoomrent,TransportandTelephonechargeswerestilloutstandingagainstthedignitaries,SeniorGovernmentOfficersand their guests who stayed in Balochistan House, Islamabad during the period July-14 to January -16 in violation of GFR 26.

Secretary S&GAD explained that outstanding dues amounting to Rs.3.980 million has been recovered from defaulters and the remaining amount is being recovered.

ParawassettledsubjecttocompleterecoveryandverificationofrecoverydetailbyD.G Audit under intimation to PAC.

Department explained that efforts are under way to recover the remaining amount as soon as possible hence, PAC is requested to settle the Para.

PAC deferred the Para with directive that the previous PAC directives regarding recovery of complete dues shall strictly be implemented within 2 months and compliance report thereof be sent to PAC for further consideration.

PARA # 5.2.9: LESS REALIZATION OF GOVERNMENT RECEIPTS – RS. 2.452 MILLION.

Audit observed that the Secretary S&GAD Balochistan allotted contract of running theCafeteriaofBalochistanCivilSecretariatQuettaamountingRs.2.582millionfor a period of three years w.e.f. 01 March, 2016 to M/s Power Engineering InternationalQuetta in violation of S.No.15 of the termsand conditions of thecontract. The contractor was bound to deposit the full amount in advance but Rs. 2.452millionwasstilloutstandingagainstthecontractor.

Secretary S&GAD informed that the contractor has depositedRs. 2.509millionthrough Challan, duly reconciled by the Treasury OfficeQuetta, copy of awardandChallanSlips/reconciliationsfromTreasuryOfficeQuettaareavailableforverification.

Para was settled.

PARA # 5.2.10: NON-REALIZATION OF GOVERNMENT REVENUE – RS. 1.383 MILLION.

Audit observed that the Services & General Administration Department Balochistan failed to realize Government revenues amounting to Rs. 1.383 million on account ofrentsandtransportchargesduringtheyear2015-16inviolationofGFR26,assummarized under

Rs. in Million

S. No. Particulars Amount

1 VIP Flats (New Juniper House) 0.072

2 Officer’s Club 0.810

3 Balochistan House Karachi 0.501

Total 1.383

Secretary S&GAD explained that amount is outstanding for long time and recoverable fromofficerswhohavebeentransferredandpostedoutsidetheProvince.However,anamountofRs.158,410/-hasbeenrecoveredfromthedefaultersanddepositedinto the government treasury. Moreover, several notices have also been issued to remaining defaulter for payment of outstanding dues.

Para was deferred with directives that Secretary S&GAD shall immediately recover remaining amount under intimation to Audit and PAC.

Department apprised that efforts are under way to recover the remaining amount as soon as possible hence, Committee is requested to settle the Para.

The Committee deferred the Para with directives that Notices to all concerned shall be issued for affecting complete recovery within 2 months and compliance report thereof be sent to the PAC for further consideration.

PARA # 5.2.14: IRREGULAR PAYMENT OF AIR PASSAGE CHARGES FOR APUG OFFICERS – RS. 12. 506 MILLION.

AuditobservedthattheSecretaryS&GADincurredanexpenditureofRs.12.506milliononAirPassagechargesunderIncentivePackage/Policyduring2015-16.Thecheques are being drawn in favour of DDO without acknowledgement of receipt, as detailed below –

Rs. in Million

Sr. No.

ChequeNumber Date Amount Sr.

No.ChequeNumber Date Amount

1. 1028729 03.09.2015 1.849 5. 1091322 25.01.2016 0.657

2. 1070308 20.11.2015 1.301 6. 1093152 17.02.2016 1.804

3. 1070761 01.12.2015 1.250 7. 1101030 21.03.2016 1.682

4. 1072077 07.01.2016 2.014 8. 1113434 17.06.2016 1.949

Total 12.506

SecretaryS&GADexplainedthattheFederalGovernmenthadtobearthefinancialburden of incentive package under the Federal Government policy “Incentive Package/PolicyfornonBalochistanDomicileAPUGOfficerspostedinBalochistan”.However, with disregard to the policy, the financial burden was shifted to theGovernment of Balochistan after about one and half year.

He further added that the Government of Balochistan on directives of the Hon’ble High Court of Balochistan further extended the incentive package/policy for Balochistan Domiciled Pakistan Administrative Services (PAS) and Police Services of Pakistan (PSP) officers recruited through Federal Public Service Commission(FPSC)asadmissibletotheNon-BalochistandomiciledAPUGofficers.

ThesubjectrecoveryofRs.12.506millionhasbeensettled.However,afterdetaileddiscussion, it was decided by the Committee that as the law & order situation of the Province is now better as compare to 2006, therefore, the payment of Air PassageChargesand50%SpecialAllowanceonrunningpayofAPUG,PASandPSPofficers,underthepolicyofFederalGovernmentandasextendedbyGovernmentofBalochistan, is to be discontinued with immediate effect under intimation to PAC.

Department shared that A summary to the competent authority has been moved to take-up the matter with Federal Government for provision of funds in this regard. The Committee is therefore, requested to settle the Para.

PAC deferred the Para with directives that the Summary sent to the Chief Minister, Balochistan for the purpose, shall be given a proper follow up and compliance report thereof be sent to the PAC within 2 months for further consideration.

PARA # 5.2.15: IRREGULAR EXPENDITURE OF ON REPAIR OF VEHICLES – RS. 3.930 MILLION.

Audit observed that the Secretary, S&GAD Quetta incurred an expenditure of Rs. 3.930milliononrepairofGovernmentvehiclesduringtheyear2015-16bysplittingthe scope of work to avoid the necessity of calling open tenders, which is clear violation of Rule-12(1) BPPR-2014.

Secretary S&GAD apprised that a committee has been constituted for repair of vehicles to refrain from splitting cost for avoiding tender process. Moreover, Finance Department has been approached for regularization of the irregular expenditure amounting to Rs. 3.930 million.

Para was settled with directives to comply with BPPRA Rules, 2014 and avoid splitting of procurement, in future.

PARA # 5.2.17: ILLEGAL RETENTION OF TAXES DEDUCTED FROM FIRM – RS. 2.119 MILLION.

Audit observed that the Secretary S&GAD Quetta paid an amount of Rs. 11.390 millionduring2015-16,toM/sAl-SubhanBusiness&GraphicsQuetta incashonaccountoffinalbillforprintingofpromotionmaterialforSeminaratPCHotelGwadar onCPEC. Income tax amountingRs. 463,592 andGST amountingRs.1,655,024 were deducted by the DDO but, were not deposited in Governmenttreasury, violating Para-23 of GFR, Vol-I.

Secretary S&GAD informed the Committee that income tax and GST withheld from the supplier are deposited in NBP Bank City Branch Quetta in favor Federal Board of Revenue as under–

Rs. in Million

S. No. Particulars Date Amount

1. 5% Income Tax 24.08.2016 0.464

2. 17% GST 12.05.2016 1.660

Total 2.124

ParawassettledsubjecttoverificationoforiginalChallanofrecoverybyDG,Auditunder intimation to PAC.

Department explained that Original challan, proving deposit of the taxes have been verified fromFBRCircleOfficeQuetta.TheCommittee is therefore, requestedtosettle the Para.

AfterverificationoforiginalChallanofrecoverybytheAudit,PACtherefore,settledthe Para.

PARA # 5.2.19: NON-MAINTENANCE OF CASH BOOK FOR EXPENDITURE – RS. 340.351 MILLION.

AuditobservedthattheSecretary,S&GADincurredanexpenditureofRs340.351million on account of various expenditures, excluding employee related expenditure, but the cashbooks for the following DDO Codes were not maintained / partially maintainedwithoutanyattestationbytheDDOandHeadofOfficeParagraph77(i)of Treasury Rules:-

Rs. in Million

S. No. DDO Code & Name Expenditure

1. QA4005 – Services & General Administration 232.606

2. QA4006 – Ministers and Their Staff 104.765

3. QA4009 – Others – VIP Flats 0.715

4. QA5227 – Balochistan House Karachi 2.264

Total 340.351

Department explained that in compliance of the DAC meeting held on 29th November, 2017,separateCashBookshavebeenmaintainedforDDOCodesQA4005S&GADand QA 4006 Ministers & their Staff, respectively. Copy of Cash Book is attached forverificationofAudit.

ParawassettledsubjecttoverificationofpropermaintenanceofCashBookbyD.GAudit under intimation of PAC.

Department explained that S&GAD has maintained Cash Books separately for each head of accounts. The PAC is therefore, requested to settle the Para.

After assurance given by the department for maintenance of Cash Books separately, PAC therefore, settled the Para.

IRRIGATION DEPARTMENT (Meetings held on 12th July & 12th December, 2019)

INTRODUCTION

The Irrigation Department has been established mainly to construct & maintain canals, delay action dams, water reservoirs for storage of water, perennial water channels and irrigation schemes. Besides, the department is responsible for river and riverbank surveys, implementation of water logging schemes, land reclamation andfloodcontrolschemesintheProvince.

PAC OBSERVATIONS

SignificantportionofauditobservationsinIrrigationDepartmentwererelatedtoOverpayments and Irregular Expenditure. Overpayments demonstrate irresponsible behavioroftheDrawing&DisbursingOfficerstowardsspendingofpublicmoney.Moreover, the Audit Paras of Evasion of Taxes & Duties, Unauthorized Expenditure andIrregularExpenditureeitherreflectlackofunderstandingorunwillingnessofthe executing staff to implement Central Public Works Account Codes, Balochistan SalesTaxonServicesAct2015,StampAct1899andBalochistanPublicProcurementRegulatory Authority Rules 2014.

To ensure adherence to the aforesaid rules and regulations establishment of strong internal control system and arrangement of training sessions for the PAO and executing staff is indispensable.

10%Overpayment

Evasion of Taxes & Du�es20%

4. Paras Settled 08

Total 10

The Committee in its meeting held on 12th July, 2019 decided to refer the Paras to Special Departmental Accounts Committee (SDAC). On the basis of the report of special DAC the Committee settled 80% of the Paras and rest of the Paras were deferred with condition that Audit shall verify the record under intimation to PAC, the compliance on which will be taken in next PAC meeting of the department.

Rs. in Million

Recovery Effected

1. Irregular Expenditure 03 1185.43 -

Paras Deferred

Paras Se�led Subject toCondi�on(s)Paras Se�led

Total 10 1328.86 11.78

Recovery of Rs.11.78 million has been effected on account of Balochistan Sales Tax on Services and Stamp Duty from the contractor. Moreover, the biggest chunk of the audit observations amounting to Rs.1185.43million represents IrregularExpenditure for which Audit recommended regularization from the competent authority. The Committee settled the respective paras with warning that, in future, all rules and regulations shall be adhered to before occurring expenditure out of the public money.

Discussion on the Appropriation Accounts for the F.Y 2016-17 was deferred with direction that Finance Department, Irrigation Department, and A.G Balochistan shall resolve the matter and respond to the Committee in next meeting.

Accountant General Balochistan briefed about the Appropriation Accounts of the Irrigation department that Development and Non-Development funds amounting to

1,185.43

112.42

UnauthorizedExpenditure

Overpayments

Rs. in Million

Rs.6,693.00 million were allocated to the Department during 2016-17. He further apprisedthatonthedirectivesofPAC,thefigureshavebeenreconciledaswell.Againstthesaidallocation,anexpenditureofRs.10,599.00millionwasincurred,assummarizedbelow―

Rs. in Million

Supp. Grant Surrender Final

GrantExpendi-

tureExcess/

(Savings) %

Non-Development (Grant No.BC21018)

1,822.55 386.64 - 2,209.19 2,269.31 60.12 2.72

Development:I. Dams

2,220.67 4,999.45 (4,504.47) 2,715.66 6,021.14 3,305.48 121.72

Development:II. Surface Irrigation

1,551.42 1,036.51 (379.62) 2,208.31 2,308.59 100.29 4.54

Total Development 3,772.09 6,035.97 (4,884.09) 4,923.97 8,329.74 3,405.77 69.00

Grand Total (Non-

Development &

Development)

5,594.60 6,422.60 (4,884.10) 7,133.20 10,599.00 3,465.89 49.00

Secretary/PAO, Irrigation department in his reply, requested the Committee for regularization of the figures as already reconciled with Finance department &Accountant General, Balochistan on the direction of PAC and assured the Forum that in future, every possible step would be taken for timely surrendering process hence, Para may please be settled.

PACregularizedthegrants/figures&settledtheagendaitem#01withdirectionsthat in future, the PAO shall timely surrender as per the deadline fixed by theFinance Department.

PARA # 6.2.1: OVERPAYMENT DUE TO EXCESS QUANTITIES THAN APPROVED IN PC-I - RS. 65.867 MILLION.

Audit pointed out that the Project Director, Extension of Pat Feeder Canal, Dera Murad Jamali, awarded the work “Construction of Sindhar Distributaries, Waryam Minor, Shol Minor, Matt Minor, Matt Drain and Allied Structure (Package No. 14)” to M/s Raza Muhammad and Company on item rate basis. Review of MB for the year2015-16,revealedthatthecontractorwaspaidfordifferentitemsofworkbyallowing excess quantities than provided in the approved PC-I’s due to which an overpaymentofRs.65.867millionwasmade in the violationofParagraph56ofCPWA Code.

Secretary, Irrigation department explained in respect of Package No. 13 amounting to Rs. 16.917 million that increase and decrease of works were made by the (Consultant/Engineer) as per Site requirements/conditions. Variation order has been obtained and all changes were made within approved and tendered cost. Moreover.RegardingPackageNo.14amountingtoRs.48.950million,heexplainedthat unauthorized payment has not been made to the contractor. The work is still in process and Rs. 30.563 million has been withheld from the contractorfor adjustment and approval of revised estimates. All changes will be covered by sanctionsandapprovalsbeforefinalizationofaccountsofthecontractor.

Para was deferred with direction that the department shall convene DAC meeting onthematterwithin15daysandsubmititsreporttothePACnotlaterthan20days.

Department while sharing the decision of SDAC, explained that the Para was

discussed in detail. All varied quantities were found within the approved estimated cost of the Package No.13 and No.14. Therefore, Para is recommended for settlement.

PACendorsedthejustificationofthedepartment&decisionofSDAChence,settledthe Para.

PARA # 6.2.2: OVERPAYMENT DUE TO ALLOWING INCORRECT RATES - RS. 35.052 MILLION.

Audit observed that the Project Director, Extension of Pat Feeder Canal, Dera Murad Jamali awarded the works “Construction of Sindhar Distributaries & Allied Structure (Package No.14) and construction of Abad Distributary & Allied Structured (Package No.13)” to M/s Raza Muhammad & Company and M/s Akhtar Ali Brohi, respectively, on item rate basis. The contractors were paid for different items of works by allowing higher rates than provided in approved BOQ due to whichanoverpaymentofRs.35.052millionwasmadeinviolationofPara16and220 of CPWA Code.

Department replied that as this Para is of the same nature and background as of Para # 6.2.1 therefore, this Para may also be referred to DAC for detail study and submission of report to PAC.

On the request of Secretary, Irrigation department, the Para was deferred with directionthatdepartmentshallconveneDACmeetingonthematterwithin15daysand submit its report to the PAC not later than 20 days.

Department while sharing the decision of SDAC, explained that The Para was checked and discussed in detail. New rate applied by the Consultants in IPC

has been withheld by the Project Director and no overpayment was made. SDAC recommended the Para for settlement subject to allowing the rate mentioned in tender documents/bids instead of new/higher rates. The new rate, if any, may be recovered. SDAC also directed that Escalation charges may also be paid as per provision, if any, contained in the Contract Agreement. The over payment has been withheld and no new rates has been paid / allowed to the contractor. Withheld amount will not be paid to Contractor.

PAC settled the Para subjecttoverificationofrecordbytheAuditunderintimationto the PAC.

PARA # 6.2.3: OVERPAYMENT DUE TO ALLOWING HIGHER RATES OF PREMIUM – RS. 8.161 MILLION.

Audit pointed out that in some Divisions of Irrigation department, an overpayment of Rs. 8.161 million was made to different contractors allowing premium at a higher rate thanapprovedandnotifiedby thePlanningandDevelopment (P&D)department in disregard of Government of Balochistan Notification No. P&D.ROCT(1)91/2008/2311 dated 11. 06. 2008 and P&D.PRCT(1)129/2013/624 dated 16.09.2013, as summarized below –

Rs. in Million

S. No. Name of office Amount

1. Executive Engineer, Irrigation Division Sibi 2.837

2. Executive Engineer, Irrigation Division, Killa Saifullah, 4.461

3. Executive Engineer, Irrigation Division, Zhob, 0.863

Total 8.161

Secretary Irrigation department explained that the cutting of hard rock does not come under the category of Earth-Work as its excavation requires blasting force

and high labor efforts therefore, the premium applicable for civil work paid to the contractor was duly approved by Planning & Development Department in PC-I and Technically sanctioned by the competent authority.

PAC DIRECTIVE(S) (12th July, 2019):

Para was deferred with directives that the department shall clarify the issue with Planning & Development (P&D) Department and convene DAC meeting into the matterwithin15daysandsubmititsreporttothePACnotlaterthan20days.

Secretary Irrigation department explained the contractor was paid according to the approved PC-I, items pointed out by Audit has been approved by P&D Department Government of Balochistan in PDWP meting @ 108% premium above under category of Civil Works. Therefore; the Para may please be dropped.

Note: Department also provided PC-Is for verification of premium and readyreference.

PAC DIRECTIVE(S) (12th December, 2019):

PAC deferred the Para with directive that the required PC1s shall be produced beforeAuditforverificationunderintimationtoPACforfurtherconsideration.

PARA # 6.2.4: OVERPAYMENT DUE TO LESS DEDUCTION OF VOIDS – RS. 3.338 MILLION.

Audit observed that in following divisions of the Irrigation department contractors werepaidforanitemofwork“Providingandfillinginwirecratesincludingsewingthecrates (a)StonesBoulders”@Rs.1,058.35%Cft.underS.INo.19-21 (a)ofCSR1998lessdeductionof25%voidsduringtheF.Y2015-16duetowhichanoverpaymentofRs.3.338millionwasmadeinviolationofchapter7.1ofSpecificationBook Vol-III:-

Rs. in Million

S.No. Name of office Amount

1. Executive Engineer, Irrigation Division, Khuzdar 1.102

2. Executive Engineer, Irrigation Division, Loralai 0.324

3. Executive Engineer, Irrigation Division, Kalat 0.173

4. Executive Engineer, Irrigation Division, Mastung 0.437

5. Executive Engineer Irrigation Division, Pishin 1.302

Total 3.338

REPLY OF THE DEPARTMENT:Secretary Irrigation department explained that all gabion structures are constructed inspecifieddesignparametersdulydressedandfinishedatallouterfaces,whereasthe audit considered and misinterpreted said item of work with boulder / stone supply work whose measurements are made through stack measurements. He furtheraddedthatChapter7.1ofSpecificationBookrecommends25%deductionsfrom calculated quantities. Moreover, the clause of deducting 25% on accountof voids from the work of “Filling Wire Crates” has been deleted in the revised Composite Schedule of Rates (CSR) 2018 issued by the P&D department.

Para was deferred with direction that the department shall clarify the issue with Planning & Development Department and convene DAC meeting on the matter within15daysandsubmititsreporttothePACnotlaterthan20days.

Department explained that in the DAC meeting, it was intimated that the P&D Department was consulted for clarifying voids deductions. As per P&D Department clarificationvideNo.P&D-ROW(i)05/2019/4039datedAugust28,2019andnewSchedule of Rates, voids deduction was not admissible for the items mentioned in thePara.However,thevoidsdeductionmadebeforeclarificationofabove-mentionedP&D Department letter may be considered as regular. Hence Para is recommended for settlement.

PAC settled the Para.

PARA # 6.2.5: UNAUTHORIZED PAYMENT OF LEAD CHARGES – RS. 8.271 MILLION.

Audit pointed out that the Executive Engineer; Irrigation Division Khuzdar awarded the work “Construction of Kangori Storage Dam, Shah Noorani area, Tehsil Wadh, Distract Khuzdar” to M/s Haji Dad Muhammad, Government Contractor during theyear2015-16.Thecontractorwaspaid leadcharges forcarriageofmaterialwithin 2 Km and without preparation of lead plan in disregard to the Planning & DevelopmentDepartment’sNotificationdated16th September 2013, which resulted in unauthorized payment of Rs. 8.271 million in violation of the Planning and DevelopmentDepartmentNotificationdated16th September 2013.

Department explained that the borrowed area of earth is located at a distance of 22 KM from the site of work. Whereas, as per the Planning & Development Department’s Notificationdated16th September 2013, the lead / carriage charges are allowed if the borrowed area of earth is beyond 22 km radius in all districts of the province. Moreover, lead charges are paid only for 02 km and the record of payment, Lead Diagram,TechnicalSanctionandPC-Iarereadyforverificationofaudit.

Parawassettledsubject toverificationof therecordofpayment,LeadDiagram,Technical Sanction and PC-I of the project by D.G Audit under intimation to the PAC.

Department explained that the Lead Diagram has been provided along with relevant documents to Audit hence, Para is recommended to PAC for settlement.

PARA # 6.2.6: EXECUTION OF WORKS WITHOUT TECHNICAL SANCTIONS – RS. 1,115.382 MILLION.

AuditobservedthatsomeofficesofIrrigationDepartment,duringtheyear2015-16,undertookdifferentdevelopmentprojectsamountingtoRs.1,115.382millionwithout obtaining prior technical sanctions of the estimates from the competent authorityassummarizedbelowinviolationofCPWDCode56andB&RCode2.82.

Rs. in Million

1. Executive Engineer, Irrigation Division Khuzdar 282.715

2. Executive Engineer, Irrigation Division Loralai. 30.424

3. Executive Engineer, Irrigation Division Turbat 48.484

4. Executive Engineer, Irrigation Division Khirther Canal Usta Muhammad 230.00

5. Executive Engineer, Irrigation Division Kalat 232.680

6. Executive Engineer, Irrigation Division Kohlu 41.079

7. Executive Engineer, Irrigation Division Drainage Dera Allah Yar 250.000

Total 1,115.382

Secretary Irrigation department explained that technical sanctions of most of the Schemes/Projects have been obtained from the competent authority and record is ready for verificationof audit.Moreover, technical sanction for the remainingprojects is underway. However, the Secretary ensured the Committee for strict compliance on the subject observation.

Committee settled the Para with directives that, in future, no work shall be executed before obtaining advance technical sanction from the competent authority and responsibilityshallbefixedagainstthosewhodonotadheretoCPWDCode56andB&R Code 2.82.

PARA # 6.2.7: NON DEDUCTION OF BALOCHISTAN SALES TAX ON SERVICES – RS. 17.198 MILLION.

Audit pointed out that in some Divisions of Irrigation department, payments to the consultants weremadewithout deduction of Balochistan Sales Tax@ 15%duringtheyear2015-16.Thisresultedinnon-realizationofBalochistanSalesTaxamounting to Rs.17.198 million in violation of Section-3 of Balochistan Sales Tax onServicesAct,2015,assummarizedbelow–

Rs. in Million

1. Project Director, Construction of 100 Dams in Balochistan 6.454

2. Project Director, Construction of Six Flood Dispersal Structure on Nari River 2.525

3. Project Director, Extension of Pat Feeder Canal Project Office, DM Jamali 4.999

4. Project Director Shadi Kour Dam 3.22

Total 17.198

Department admitted the violation of Section 3 of the Balochistan Sales Tax (BST) onServicesAct,2015andensuredtheCommitteethatthedueamountofBSTwillbe withheld from the next invoice of the supplier/contractor and will be submitted to Balochistan Revenue Authority under intimation to D.G Audit and the PAC.

Para was settled subject to recovery of BST amounting to Rs. 17.198 million from the contractors and submission of deposited Challan to D.G Audit and the PAC.

Department explained that the Project P.D Extension of Pat-feeder Canal Project has found consistent with the departmental stance. Matter may be referred to the BRAforclarification.Therefore,Paramaybesettled.

PARA # 6.2.8: NON REALIZATION OF STAMP DUTY – RS. 5.540 MILLION.

Audit Pointed out that in some offices of Irrigation department, contracts wereawardedtovariouscontractorsduringF.Y2015-16withoutrealizingStampDutyintheshapeofnon-judicialstamppaperamountingtoRs.5.540millionindisregardof Section 22 (A) of Schedule I to Stamp Duty Act, 1899, as summarized below–

Rs. in Million

1. Executive Engineer, Irrigation Division Kalat 0.582

2. Executive Engineer, Irrigation Drainage Dera Allah Yar 0.625

3. Project Director, Construction of Six Dispersal Structures on Nari River 0.179

4. Executive Engineer, Pat-feeder Canal Division Dera Murad Jamali 2.847

5. Executive Engineer, Irrigation Division Killa Saifullah 0.455

6. Executive Engineer Irrigation, Pishin 0.852

Total 5.540

Department replied that recovery amounting to Rs. 5.540 million on accountof Stamp Duty has been effected from the contractors and record is ready for verificationofaudit.

Para was settled subject to submission of Stamp Papers/ Challans/ Receipts amountingtoRs.5.540milliontoAuditandPACforverification.

DepartmentsharedthattheoriginalrecordwasprovidedtoauditforverificationofStamp duty realization. The Therefore, Para may be settled.

PARA # 6.2.9: IRREGULAR AWARD OF CONTRACT WITHOUT POSTING ON BPPRA WEBSITE – RS. 63.327 MILLION.

Audit pointed out that Executive Engineer, Irrigation Division Kachi awarded followingcivilworkstocontractorsduringtheyear2015-16withoutuploadingthebidsonBPPRAwebsiteinviolationofSection15(1and2)ofBalochistanPublicProcurement Rules 2014. Detail is summarized below–

Rs. in Million

S.No. Name of work and Contractor Amount

1. Construction of flood protection bunds Sunni Tehsil, M/s Malik 3158620248. 25.000

2.Extension and improvement of Gawar Ghari flood irrigation scheme, M/s Origin Enterprises

19.727

3.Construction of Flood Protection Bund Agriculture Land Near Khan, M/s Yar Muhammad.

11.400

4. Construction of flood protection bund in U/C of District Kachi, M/s Malik Arif. 7.200

Total 63.327

Departmentexplainedthatatthebeginning,itwasverydifficulttouploadtenderinvitation documents on the BPPRA website due to the lack of understanding of BPPRA Rules, 2014 and due to untrained staff. However, for wide circulation of advertisement, the notice inviting tender was published in widely circulated Newspapers.

The Para was deferred with directives that the department shall resolve the matter with Finance Department and inform the outcome to PAC and Audit, accordingly.

Department explained that the original Tenders along with relevant proof was provided to Audit for verification that tenders were advertised and uploadingof Tenders on BPPRA website may be overlooked as the staff was not capable/experienced of tendering process through BPPRA website at the outset of BPPRA system.

PAC settled the Para with directives that in future, BPPRA rules be strictly followed.

PARA # 6.2.10: IRREGULAR ENHANCEMENT OF CONTRACT AGREEMENT – RS. 6.724 MILLION.

Audit observed that the Executive Engineer, Irrigation Division Kohlu awarded the

work “construction of Dam Narwal Eashani District Barkhan” to M/S Abdul Ghani, Government Contractor at cost of Rs. 14.061 million during the year 2011-12. Later on the management enhanced the scope of work and contractual value of agreement toRs. 20.785million during the year 2014-15. The enhancement ofongoing contract to the same contractor was held irregular because the increased amountwasmorethan15%oftheoriginalcontractamountforwhichretenderingwasrequiredasdetailedbelowinviolationofclause51(b)(iv)ofBPPRARules,2014

Rs. in Million

S.No. Original Cost Enhanced Cost Difference % increase

1. 14.061 20.785 6.724 32%

Department explained that the scope of work was enhanced due to Site conditions andincreaseinstoragecapacityofDamfrom434to905acrefeetbyincreasingthe height of structure of the Dam which was duly approved by PDWP in its meetingheldon27.11.2014attherevisedcostofRs.20.785million.Theworkonthe construction of Narwal Eashani Dam, district Barkhan began in 2011-12 and BPPRA Rules were enacted in 2014 therefore, the work on the project does not fall under the applicability scope of the said rules.

Para was settled subject to issuance of warning to all Executive Engineers by PAO under his administrative control to avoid such practice in future otherwise, strict action will be taken against the person(s) at fault.

Department apprised that warning letter has been issued accordingly to lower formation for compliance.

PUBLIC HEALTH ENGINEERING (PHE) DEPARTMENT

(Meeting held on 23rd October, 2019)

INTRODUCTION

The major functions of Public Health Engineering Department is to provide access to the safe drinking water in the rural as well as urban slums, installation of the tube-wells and establishment of drinking water supply schemes in the Province. Department also ensures availability of piped water in adequate quantity for drinking and house-hold purpose and protection of water sources from contamination etc.

Other important functions of the department are as under–

1. Improvement of sewerage system and sanitary conditions.

2. Levying regular revenue to cover all costs of operation and maintenance.

PAC OBSERVATIONS

While examining the Audit Report 2017-18 it was pointed out that significantportion of audit observations in Public Health Engineering Department were related to higher rate of premium and payments on Non-Scheduled Rate (NSR) basis to the Contractors which resulted in Overpayments and Irregular Expenditure. Overpayments demonstrates irresponsible behavior of the Drawing & Disbursing Officerstowardsspendingmoneyoutofthepublicfund.

In most of cases the department violated General Financial Rules (GFR) which portrays lack of understanding of the Executing Staff in the area and ineffective internal controls system in place.

PUBLIC HEALTH ENGINEERING (PHE) DEPARTMENT88

Total 08

As in most of the cases Audit recommended recovery, therefore, none of the Para wassettledbytheCommittee.50%oftheparasweredeferredandrestweresettled

Recoverables12%

12%Overpayment

50% 50%

Paras Se�led Subject to Condition(s)

Paras Se�led

subject to satisfaction of conditions on which compliance will be taken in the next PAC meeting of the department.

Rs. in Million

# Audit Observations No. of Paras

Recovery Effected

4. Overpayments 03 19.96 5.39

Total 08 167.11 5.39

After detailed examination, Committee deferred 04 Audit Paras with the direction to the PAO to initiate inquiry in the matters and effect recovery on account of Water Tariff Charges Rs.11.68 million and Income Tax amounting to Rs.4.79 million. Moreover,restofthe04AuditParasweresettledsubjecttoverificationofrecordbyofficeoftheD.GAuditBalochistanunderintimationtoPAC.

122.87

Recoverables

Overpayments

Rs. in Million

The compliance on aforesaid directives will be taken in next PAC meeting of the Department.

Accountant General Balochistan briefed the Appropriation Accounts of Public Health Engineering department before Committee that Development and Non Development FundsamountingtoRs.9,544.14millionwereallocatedtotheDepartmentduring2016-17.Against thesaidallocation,anexpenditureofRs.9,765.05millionwasincurred, as summarized below –

Rs. in Million

Head of Account

Original Grant

Supp. Grant Surrender Final Grant Expendi-

tureExcess/

(Savings) %

Non-Development (Grant No.BC21014)

3,095.59 1,439.88 - 4,535.47 4,625.46 89.98 1.98

Development (Grant No. BC12105)

15,236.50 3.00 (10,230.82) 5,008.67 5,139.62 130.95 2.61

Total 18,332.09 1,442.88 (10,230.82) 9,544.14 9,765.08 220.93 2.31

A.G Balochistan further apprised the Committee that department incurred expenditure of Rs. 89.985 million in excess of the final grant under the non-development head. Regarding Development Grant the A.G explained that departmentobtainedoriginalbudgetamountingtoRs.15,236.50millionunderthehead of development grant; out of which Rs.10,230.82 million was surrendered resultinginfinalgrantofRs.5,008.67million.AgainstfinalgrantofRs.5,008.67milliondepartmentincurredanexpenditureofRs.5,139.622millionwhichresultedinexcessexpenditureofRs.130.952million.Departmentmustexplainthatwhythe huge amount of grant, under development head was demanded if it had to surrender it later.

Department replied that excess expenditure under the head of non-developments is on account of Salaries, Transfers, and Promotions which are inevitable payments. The department further explained that the approved grants under the development head were not released by Finance Department in time, therefore, the huge amount of Rs.10,230.82 million was surrendered.

PAC DIRECTIVE(S)

Since the excess expenditure was less than 5% of the total grant, therefore,Committee regularized the excess expenditure with directives that such practice be avoided in future and budget be demanded/prepared on rational basis

PARA # 7.2.1: OVERPAYMENT DUE TO ALLOWING HIGHER RATE OF PREMIUM – RS. 9.488 MILLION.

Audit pointed out that several Divisions of the Public Health Engineering department awarded tenders of various water supply schemes to different contactors during 2015-16. The premium of civil works was paid on excavation and earthenembankment which falls under the category of “Earthwork”, therefore, the premium of earthwork was payable instead of civil works. This resulted in an overpayment of Rs.9.488millioninviolationofthePlanningandDevelopmentNotificationNo.P&D.ROCT(I)129/2013/3624 dated 16th September, 2013. Detail is summarized below –

Rs. in Million

S.No. Name of Office AIR Para Amount

1. PHE Division, Killa Saifullah 01 0.523

2. PHE Division, Khuzdar 01 0.231

S.No. Name of Office AIR Para Amount

3. PHE Division, Kalat 04 0.478

4. PHE Division, Washuk 05 0.283

5. PHE Division, Zhob 01,05 1.213

6. PHE Division, Dera Bugti 01 6.760

Total 9.488

Department explained that about Rs. 6 million has been collectively recovered in Killa Saifullah, Khuzdar, Kalat, Washuk and Zhob Divisions. However, in respect of Dera Bugti Division, Principal AccountingOfficer (PAO) presented some justificationsbefore Committee for non-recovery of the dues.

PAC DIRECTIVE(S)

TheCommitteesettledtheParasubjecttoverificationofrecoveryrecordbyAuditunder intimation to PAC.

PARA # 7.2.2: OVERPAYMENT DUE TO ALLOWING HIGHER RATES – RS. 5.511 MILLION.

Audit observed that the Executive Engineer, PHE Division, Loralai awarded the work “Drilling and Development of Bore for water supply schemes Loralai Town and surrounding villages” to M/s Haji Zareef Khan and Brothers, Government Contractor. While checking the approved rates with reference to measurement book it was observed that in different items of work the contractor was allowed rates higher than those approved in the contract agreement. Thus due to allowing higher ratesanoverpaymentofRs.5.511millionwasmadetothecontractor,inviolationof Para 19(iv) of GFR Vol. I.

Department explained its version that the revised work order was issued within the cost, only scope of work was revised. It is not practically possible to effect recovery, because, project has been completed and all payments have been made to the contractor.

PAC DIRECTIVE(S)

Committee expressed deep concerns on department over not implementing the decision of Departmental Accounts Committee (DAC) taken in December 2017. Moreover, the plea of the department for settlement of Para was discarded and the PrincipalAccountingOfficer(PAO)wasdirectedtoinitiateinquiryintothematterwithin one month under intimation to PAC for further consideration. Para stands.

PARA # 7.2.3: OVERPAYMENT DUE TO ALLOWING HIGHER RATES OF PREMIUM THEN APPROVED – RS. 4.960 MILLION.

Audit observed that the Executive Engineer, PHE Division, Loralai awarded the work “Civil works water supply scheme Loralai town and surrounding villages” to M/s Allah Din, Government Contractor @ 47.40% above Civil Works and 127.44% above for steel works on Balochistan CSR 1998 on 12.04.2012. Later on, the management allowed the contractor to work on new rates of premium issued by P&D Department is questionable. The revised premium rates were approved @ 108% above civil works and 208% steel works respectively. Thus due to allowing higher rates of premium, an overpayment of Rs. 4.960 million was made to contractor in violation of Para 19(iv) of GFR Vol. I.

Rs. in Million

S.NO. Description Amount Premium Paid

Premium Payable Difference

1. Civil Work Old 47.4% above 2.430 1.152 1.152 -

2.Civil Work (New) Premium allowed 108% above instead of 47.4% above

4.793 5.177 2.272 2.905

3. Steel Works Old 127.44% above 0.680 0.867 0.867 -

4.Steel Works (New) Premium allowed 208% above instead of 127.44% above

2.552 5.307 3.252 2.056

Total 10.455 12.503 7.542 4.960

Departmental stance was same as for Para # 7.2.2.

PAC DIRECTIVE(S)

Committee expressed deep concerns on department over not implementing the decision of Departmental Accounts Committee (DAC) taken in December 2017. Moreover, the plea of the department for settlement of Para was discarded and the PrincipalAccountingOfficer(PAO)wasdirectedtoinitiateinquiryintothematterwithin one month under intimation to PAC for further consideration. Para stands.

PARA # 7.2.4: LESS REALIZATION OF WATER TARIFF – RS. 11.676 MILLION.

Audit pointed out that in some divisions of the Public Health Engineering, an amountofRs.11.676millionremainedoutstandingduring2015-16,onaccountofwater tariff charges against various residential and commercial units, in violation ofPublicHealthEngineeringDepartmentNotificationNoSOT(3-4)/PHED/2009-2010/973-1053dated10.3.2010.

Rs. in Million

S.No Name of Division Categories Amount Recoverable

Amount Realized Difference

1. PHE Division Khuzdar

Residential/ Commercial

N/m 0.369 0.369

2. PHE Division Awaran 1.944 0.014 1.930

3. PHE Division Dalbandin 3.734 0.800 2.934

4. PHE Division Washuk N/m 0.054 0.054

5. PHE Division Sibi 6.324 1.804 4.520

6. PHE Division Kohlu 1.621 0.096 1.525

7. PHE Division DM Jamali 0.765 0.421 0.344

Total 11.676

Department explained that at present there is no proper billing system for recovery of water tariff, however, efforts are being made to computerize the system. Moreover, effective steps have been initiated to recover the remaining amount of Water Tariff (Charges) as per the target set by the higher authorities.

PAC DIRECTIVE(S)

Committee settled the Para with directives that the department shall design rational, effectiveandefficientmechanism/systemforrecoveryofWaterTariff(Charges)infuture.Moreover,PrincipalAccountingOfficerwasdirectedtorecovertheremainingamount under intimation to the PAC.

PARA # 7.2.5 LOSS DUE TO NON/LESS DEDUCTION OF INCOME TAX– RS. 4.787 MILLION.

Audit pointed out that in Awaran and Kharan Divisions of the Public Health Engineering Department, didn’t deduct or ducted less income tax amounting to Rs.4.787millionduring2015-16inviolationofSection–153(1)(c)of IncomeTaxOrdinance 2001.

Department explained that the procurement consists of both goods and services. Therefore,ontheservicescomponent7.5%andgoodscomponent4.5%incometaxwaswithheld.TherecordisreadyforverificationofAudit.

PAC DIRECTIVE(S)

Asthejustificationofthedepartmentwasnotmaintainable,therefore,CommitteedeferredtheParaanddirectedthePrincipalAccountingOfficertoeffectrecoverywithin one month under intimation to PAC for further consideration.

PARA # 7.2.6: UNAUTHORIZED EXPENDITURE ON NSR ITEMS WITHOUT APPROVED RATE ANALYSIS – RS. 122.872 MILLION.

Audit pointed out that some Divisions of the Public Health Engineering Department incurredanexpenditureofRs.122.872millionondifferentworksduring2015-16,on NSR basis without preparing rate analysis and getting them approved by the competent authority in violation of Para 296 of CPWA Code Vol-I.

Rs. in Million

S.No. Name of Office AIRPara No. Amount

1. PHE Division, Khuzdar 04 7.561

2. PHE Division, Panjgur 03 2.600

3. PHE Division, Kachi at Dhadar 04 20.820

4. PHE Division, Kalat 03 3.312

5. PHE Division, Washuk 04 1.820

6. PHE Division, Zhob 02,07 48.441

7. E & M Workshop, Quetta 06 2.210

Rs. in Million

S.No. Name of Office AIRPara No. Amount

8. PHE Division, Loralai 5 36.108

Total 122.872

Department apprised the forum that in compliance of the decision taken in the DAC meeting, approval the rate analysis was obtained from the competent authority. CopywasattachedbytheDepartmentforverificationofaudit.

PAC DIRECTIVE(S)

CommitteesettledtheParasubjecttoverificationofAuditof“RateAnalysis”,alongwith its approval by the competent authority under intimation to PAC for further consideration.

PARA # 7.2.7: PURCHASE OF UPVC PIPES FROM THE UNAUTHORIZED CONTRACTOR – RS. 3.473 MILLION.

Audit pointed out that Washuk and Kharan divisions of the Public Health Engineering department incurred an expenditure of Rs. 3.473 million on purchase ofUPVCPipesofdifferentdiameterduring2015-16.Itwasobservedthatthefirmswere not registered as manufacturer in Pakistan Engineering Council.

Department apprised the forum that in compliance of the decision taken in the DAC meeting, the approval has been obtained from the competent authority. Copy was attachedbytheDepartmentforverificationofaudit.

PAC DIRECTIVE(S)

Committee settled the Para subject to verification of the approval, obtained bycompetent authority by Audit under intimation to PAC.

PARA # 7.2.8: IRREGULAR EXPENDITURE ON REPAIR OF MACHINERY AND WATER SUPPLY SCHEMES – RS. 4.343 MILLION.

Audit pointed out that in Quetta and Hub divisions of the Public Health Engineering department incurred an expenditure of Rs. 4.343 million on repair of machinery anddifferentwatersupplyschemesduring2015-16.Theexpenditurewassplittoavoid calling of tenders and sanction of the competent authority.

Further, the defect reports of machinery, MB’s and dismantled parts registers were also not produced to audit in violation of Para 146 of GFR, Vol-I and S. No. 24 of Annexure – A to Chapter 8 of GFR Vol-I.

Department explained that in exercise of the Power No. 20.9 of the Balochistan Delegation of Financial Powers and Re-Appropriation Rules, 2019 delegated to the Secretary PHE, pertaining to sanction of repairs and carriage of tolls and plants, the subject expenditure may be treated as regularized.

PAC DIRECTIVE(S)

CommitteesettledtheParasubjecttoverificationoftheregularizationofexpenditurerecord by Audit under intimation to the PAC.

EDUCATION DEPARTMENT

INTRODUCTION

The Education Department is responsible to provide quality education from primary to graduation level and overall management of educational institutions from primary schools to degree colleges. Besides, it also administers technical and vocational institutions in Balochistan.

PAC OBSERVATIONS

While examining the Audit Report 2017-18 it was observed that most of the Audit Paras in Education Department were related to Irregular and Unauthorized Expenditure which portrays non-adherence to Government’s Standing Orders, rules, regulations, policies and procedures. The biggest chunk of the Irregular Expenditure were on account of unauthorized investment and retention of public money for about 03 years.

As is the case with other departments, violation of the Constitution of Pakistan 1973, General Financial Rules, Balochistan Public Procurement Rules 2014, Standing OrderandNotificationsof theGovernment,FederalTreasuryRules, IncomeTaxOrdinance 2001 and Sales Tax Act 1990 was repeatedly noted which necessitates the establishment of strong and effective internal control system in the department.

47%Non-Produc�on of Record

11%Recoverables

EDUCATION DEPARTMENT100

4. Paras Settled 04

Total 19

Most of the Audit Paras were deferred, owing to the fact that the department could notsatisfytheCommitteewithitsjustifications.Hence,Committeedecidedtogranttime to department for initiating pending inquires, effecting remaining recoveries andprovidingrecordtoAuditforverification.

Moreover, following special directives were also issued by the Committee to concern departments:

1. DG Audit, Balochistan was directed to implement the decision of previous PAC and commence the Special Audit of Balochistan Text Book Board, Quetta for the period from 01-07-2013 to 30-06-2018 (05 years) underintimation to PAC.

58% 21%

Paras Deferred

2. Secretary Finance Department was directed to reconcile the issue of “Drawl of Pay & Allowances in excess of Sanctioned Strength” with the PAO of Secondary Education Department.

Rs. in Million

S.No. Audit Observations No. of Paras

Recovery Effected

1. Irregular Expenditure 09 1,119.40 854.72

2. Non-Production of Record 02 470.01 17.09

4. Unauthorized Expenditure 04 219.53 3.91

Total 19 1,819.04 876.74

After intervention of Public Accounts Committee, the illegally blocked/retained publicmoneyRs.854.72millionhasbeentransferredbytheSecondaryEducationDepartment into the Government Treasury. Additionally, the recovery of Rs.22.016 million (Rs.17.09 million + Rs.3.91 million + Rs.1.01 million) against the respective

1,119.40

470.01

219.53

854.72

Recoverables

Rs. in Million

EDUCATION DEPARTMENT102

audit observations as demonstrated by the above bar chart has been effected.

Furthermore, the compliance of remaining recovery on Paras deferred and conditionally settled will be taken in the next PAC meeting of the Department.

COLLEGES, HIGHER & TECHNICAL EDUCATION DEPARTMENT

(Meeting held on 25th October, 2019)

AG Balochistan explained that against the final grant of Rs.8,406.71 million,the department incurred an expenditure of Rs.6,787.38 million and Rs.1,619.33 millionwassaved.Sofarasdevelopmentgrantisconcernedagainstthefinalgrantof Rs. 4,394.86 million, the department incurred an expenditure of Rs. 178.64 millionindicateshugesavingofRs.4,216.22millionwhichamountsto95.90%offinalgrant.TheextraordinarysavingunderDevelopmenthead(Others)shouldbejustified.

Rs. in Million

Supp. Grant

Surren-derFinal Grant

Expendi-ture

Excess/ (Savings)

Non-Development Higher

Education (Grant No.BC21016)13,701.93 - (5,295.22) 8,406.72 6,787.38 (1,619.33) 19.26

Total Non-Development 13,701.93 - (5,295.22) 8,406.71 6,787.38 (1,619.33) 19.26

Development General

Universities/Colleges/Institutes

(Function: 93101)

2,065.45 1,807.95 (564.09) 3,309.31 4,196.89 887.58 26.82

Development Others

(Function: 093120)2,731.96 1,662.90 - 4,394.86 178.64 (4,216.22) 95.90

Total Development 4,797.42 3,470.85 (564.09) 7,704.18 4,375.54 (3,328.64) 43.20

Grand Total 18,499.35 3,470.85 (5,859.31) 16,110.89 11,162.92 (4,947.97) 30.70

COLLEGES, HIGHER & TECHNICAL EDUCATION DEPARTMENT104

The PAO explained the funds were released late by the Finance Department, due to which funds were surrendered back. He requested the Committee for settlement of savings under Non-Development head. However, the Communication & Works Department, being executing agency for spending development portion of our budget, can better explain the saving shown in Development grant.

PAC DIRECTIVE(S)

The Committee regularized the saving of Rs. 1,619.328 million in Non-Development head and Rs. 3,328.640 million in Development head with directives that in future, rationalized budget be demanded by the department and practice of huge savings be avoided.

PARA # 8.2.1: NON-PRODUCTION OF RECORD OF – RS. 16.793 MILLION.

Auditpointedout that the followingofficesof theHigherEducationDepartmentincurredanexpenditureofRs.16.793million,during2015-16,oncivilworks,studytour of students and remuneration to teachers for extra classes, but no record was produced to audit for scrutiny in violation of Article 170 (2) of the Constitution of Islamic Republic of Pakistan read with Para 14-1 (b) and 2 of the Auditor General’s Ordinance 2001, as summarized below–

Rs. in Million

S.No. Name of Office AIR Para/ Year Description Amount

Project Director, Restructuring of Technical Education and Vocational Training System Project, Balochistan Quetta

5/ 2015-16

Remaining work of Establishment of Govt Poly Technical Institute for Boys at Khanozai District, Pishin

15.500

2.Principal, Government College of Technology for Boys, Quetta

4/ 2014-16

Study Tour of Students, Remuneration to Teachers for extra classes, R/o Unknown Building

Total 16.793

Department explained that in pursuance of DAC decision, record in respect of both officeshavebeenprovidedtoAuditforverification.

PAC DIRECTIVE(S)

CommitteesettledtheParasubjecttoverificationofrecordbyAuditunderintimation

to the PAC.

PARA # 8.2.2: LOSS DUE TO NON-DEPOSITING OF THE BUS CHARGES – RS. 1.764 MILLION.

Audit observed that in violation of para-23 of GFR Vol-I, the Principal Government Girls Degree College Quetta, did not deposit bus charges realized from the students amountingtoRs.1.764millionduring2014-15&2015-16resultedintoalosstothe Government exchequer.

Department explained that in order to resolve Audit observations, the department have formulated a policy under title “Transportation Policy for Colleges, Higher & Technical Education Department”. The policy would guide the College Management in development of comprehensive management plan routes, mileage, fares and POL utilization. However, the aforesaid policy has been submitted for approval of Hon’ble Chief Minister Balochistan on 11th September, 2019 which is still awaited.

On account of non-depositing of bus charges, the department explained that Finance Department did not provide funds for POL as per requirement, therefore, the bus charges were utilized for procurement of POL and repair & maintenance of students’ transport vehicles.

PAC DIRECTIVE(S)

CommitteesettledtheParasubjecttoverificationofrelevantrecordbyAuditunderintimation to PAC.

PARA # 8.2.3: IRREGULAR PAYMENT OF MOBILIZATION ADVANCE – RS. 88.087 MILLION.

Audit observed that The Project Director, Cadet Colleges, Quetta awarded the work “Construction of Cadet College Killa Abdullah” to M/s NPI Construction & Engineering at a total cost of Rs. 888.087 million. An advance payment of Rs. 88.087millionwasmadetothecontractorinthefirstrunningbillwithoutapprovalof FinanceDepartment in disregard ofNotificationNo. FD (RI-2/MA92 / 1392-1492, dated 30th April 1992.

Department apprised that “Construction of Cadet College Killa Abdullah” Project is under construction however, PAO ensured that the remaining amount of mobilization advance would be recovered in F.Y 2019-20 under intimation to the PAC and Audit.

PAC DIRECTIVE(S)

CommitteedirectedthePrincipalAccountingOfficertoeitherrecovertheremainingamount of mobilization advance from contractor or adjust the amount against the work done under intimation to PAC and Audit, hence the Para was deferred.

PARA # 8.2.4: IRREGULAR EXPENDITURE ON PROCUREMENT – RS. 19.767 MILLION.

Audit pointed out that in some offices of theHigher Education department, anexpenditure of Rs. 19.767 million was incurred during 2011-16, on different items which was held irregular because of the following reasons:-

1. Open tenders were not called.2. Purchasesweremadefromunregisteredfirms.3. The expenditure was made beyond delegated powers.4. Payments were made on hand written receipts instead of proper bills /

invoices.5. ChequeswerepreparedinthenameofDDOinsteadoffirms,inviolationof

Treasury Rules.6. Acknowledgement receipts of the payees were also not available on record.

Department informed theCommittee thaton thebasisoffinancial irregularitiespointed out by Audit, the Principal Cadet College Pishin has already been terminated, moreover, further inquiry is being conducted by the department hence, the PAO requested the Committee for grant of 03 months’ time to complete the inquiry under intimation to the Committee and Audit, accordingly.

PAC DIRECTIVE(S)

Committee deferred the Para with the directives that the Principal Accounting Officershallcompleteinquirywithin03monthsunderintimationtoPACforfurther

consideration.

PARA # 8.2.5: UNAUTHORIZED RETENTION OF – RS. 12.64 MILLION.

Audit observed that the Principal Cadet College Killa Saifullah, illegally retained an amount of Rs. 12.64 million in various commercial bank accounts, in violation of Finance Department (Regulation Wing) Notification No. SO (B&A)1-1/Misc./S&GAD/2008-09/520-52re-circulatedon23-08-2008.

DG Audit apprised that, under audit recommendations, the department has obtained ex-post-facto approval from Finance Department, therefore, the Para is recommended for settlement.

PAC DIRECTIVE(S)

As the ex-post-facto approval of opening Accounts in Commercial Banks has been obtainedfromtheFinanceDepartmentanddulyverifiedbytheAudit,therefore,Committee settled the Para.

PARA # 8.2.6: UNAUTHORIZED DRAWLS OF ADVANCE SALARIES – RS. 3.197 MILLION.

Audit pointed out that the Principal Cadet College Pishin, drew an amount of Rs. 3.197million,duringtheyear2015-16,fromtheGovernmenttreasuryandmadeunauthorized payment to contractual staff on account of advance salaries, in disregard of Para-10 of GFR Vol-1.

Rs. in Million

S.No. Cheque No. MonthsDrawn Advance pays

w.e.f 12-2015 to 9-2016 (10 months)

Deduction per month Outstanding

1. 20015986 Nov-15 0.100 0.050 0.050

2. 20036475 Mar-16 0.900 0.050 0.850

3. 20036422 Apr-16 0.095 0.050 0.045

4. 20016034 26-1-2016 0.200 0.050 0.150

5. 20016008 2/12/2015 0.150 0.050 0.100

6. 54321237 11 to 6-2016 0.200 0.050 0.150

7. 54321244 11 to 6-2016 0.200 0.050 0.150

8. 20050948 May-16 0.140 0.050 0.090

9. 20050982 Jul-16 0.212 0.050 0.162

10. 20050994 Aug-16 1.000 - 1.000

Total 3.197 0.450 2.747

Department informed the Committee that the Principal Cadet College Pishin has been terminated. Moreover, recoveries pointed out by audit will be affected under intimation to the PAC and Audit.

PAC DIRECTIVE(S)

Committee deferred the Parawith directives to the Principal AccountingOfficer(PAO) to effect recovery within 03 months under intimation to PAC.

SECONDARY EDUCATION DEPARTMENT (Meetingsheldon5thJuly&25th October 2019)

AG Balochistan apprised the Committee that under the non-development head, departmentincurredanexpenditureofRs.1,032.63millioninexcessofthefinalgrant.OnDevelopmentGranttheA.GexplainedthatsavingsofRs.1,590.11millionundertheheadofdevelopmentgrantbejustified.

Rs. in Million

Supp. Grant

Surren-der

Final Grant

Expendi-ture

Excess/ (Savings)

Non-Development

Secondary Education

(Grant No.BC21014)

28,932.22 2,751.12 - 31,683.34 32,715.97 1,032.63 3.26

Total Non-

Development28,932.22 2,751.12 - 31,683.34 32,715.97 1,032.63 3.26

Development Primary

Education (Function:

091102)

556.88 316.83 - 873.70 828.42 (45.28) 5.18

Development

Secondary Education

(Function: 092101)

1.082.38 2,223.15 (121.18) 3,184.34 1,639.51 (1,544.83) 48.51

Total Development 1,639.25 2,539.97 (121.18) 4,058.04 2,467.93 (1,590.11) 39.18

Grand Total 30,571.47 5,291.09 (121.18) 35,741.38 35,183.89 (557.48) 1.56

Department replied that the development portion of the budget is spent by Communication & Works (C&W) department, being executing agency, therefore the

respectiveSecretarycanbetterexplainthejustificationforsavingsshownunderdevelopment grant. PAO further explained that one of the major causes of savings in development grant is late release of funds from the Finance Department. However, he ensured to avoid the practice in future.

PAC DIRECTIVE(S) (25TH OCTOBER 2019):

Committee regularized the excess expenditure of Rs.1,032.63 million in Non-DevelopmentheadandsavingofRs.1,590.113millioninDevelopmentheadwiththe directives that rationalized budget shall be demanded by the department in future and practice of huge excess and saving be avoided.

EXAMINATION OF AUDIT REPORT 2017-18(Meetings held on 5th July & 25th October, 2019)

PARA # 8.2.7: NON-PRODUCTION OF RECORD OF – RS. 453.212 MILLION.

AuditpointedoutthatvariousofficesofSecondaryEducationDepartmentincurredanexpenditureofRs.453.212million,during2014-16ondifferentheads,butinsupport of said expenditure, no record was produced to audit for scrutiny.

Departmentexplainedthatofficersinvolvedinnon-productionofrecordtoauditwere suspended and Show cause Notices were also issued. Resultantly, they have provided the original recordwhichwill be ready andprovided for verification ofaudit within 10 days.

PAC DIRECTIVE(S) (5TH JULY 2019):

Para was deferred and directed the Secretary (PAO) to provide the relevant record, in original, to D.G Audit within 20 days under intimation to Assembly Secretariat.

SECONDARY EDUCATION DEPARTMENT 112

REPLY OF THE DEPARTMENT ON 25TH OCTOBER 2019:

Department informed the Committee that the relevant record has been provided to auditforverification.

ParadeferredwithdirectivethatPrincipalAccountingOfficershallgettherecordaudited by D.G Audit Balochistan within 45 days under intimation to PAC forfurther consideration.

PARA # 8.2.8: IRREGULAR INVESTMENT OF – RS. 500.00 MILLION.

Audit pointed out that the Secretary Education Department, Quetta, drew an amountofRs.500.00milliononaccountof“ChiefMinisterBalochistanEducationAward” from the Endowment Fund vide Accountant General Baluchistan’s Cheque No. 0872311 dated 27.06.2014 and deposited the same in National Bank of Pakistan forafixedperiodoffiveyearsatanannualcompoundprofitrateof12.15%perannum in violation of GFR vol-1 Para 13. Audit was of the view that unauthorized investment of public money caused blockage of government money.

Department replied that after approval from the Finance Department, the amount wasinvestedinBank@12.15%profit.ThemodalitieshavebeensetbetweentheEducation Department and BEEF therefore, the amount invested in TDR and PLS account will be paid/transferred to BEEF and audit will be informed, accordingly.

Para were deferred with directives that all relevant record shall be provided within 20daystoD.GAuditforverificationunderintimationtothePAC.

REPLY OF THE DEPARTMENT ON 25TH OCTOBER 2019:Department apprised the Committee that the relevant record has been provided to auditforverification.

Parawasdeferredwithdirectives thatPrincipalAccountingOfficershall get therecordauditedbyAuditwithin45daysunder intimation to thePAC for furtherconsideration.

PARA # 8.2.9: DRAWL OF PAY IN EXCESS OF SANCTIONED STRENGTH – RS. 213.52 MILLION.

AuditpointedoutthatthefollowingofficesoftheSecondaryEducationDepartmentwere drawing salaries in excess of sanctioned strength of staff of different cadres whichresultedinanunauthorizedpaymentofRs.213.52million.

Rs. in Million

S.NO. Name of Office AIR Para/ Year Amount

1. Deputy District Officer Education (F) Zarghoon Town, Quetta. 1/ 2014-15 13.116

2. Deputy District Officer Education (F) Chiltan Town, Quetta. 10/ 2015-16 120.876

3. District Officer Education (F), Quetta. 10/ 2015-16 79.528

Total 213.52

Department shared that there is difference of 4000 posts between the sanctioned strength of Education Department and Budget Book of Finance. Department apprised that in compliance of the orders of Balochistan High Court, Education Department is working on this issue with and sharing administrative approvals with the Finance Department for reconciliation of data. About 3000 posts have been reconciled in different districts whereas, data of some districts is still under process. The Secretary solicited time to resolve issue till all the data has been reconciled.

Committee deferred the Para with directives that Education Department, Finance Department, and Accountant General Balochistan shall arrange presentation on the issue. However, the date of presentation shall be communicated later.

Department informed the Committee that in pursuance of the PAC directives administrative approval regarding sanctioned posts issued by the competent authority,detailsofpostsofallcadresreflectedtheBudgetBook,detailofsalariesdrawn in favor of teaching staff, and expenditure statement of Pay & Allowances reconciled with A.G Balochistan have been obtained from the concerned Draw& DisbursingOfficers(DDOs)areavailableforverificationofaudit.

Para was deferred however, the Secretary Finance Department was directed to reconcile the issue with the Education Department within one month under intimation of PAC for further consideration.

PARA # 8.2.10: IRREGULAR DISBURSEMENT OF PAY & ALLOWANCES – RS. 207.152 MILLION.

AuditobservedthatinvariousofficesoftheSecondaryEducation,duringtheyear2014-16,anamountofRs.2017.152millionwasdrawnonpayandallowancesfor employees and disbursed in cash instead of making payments directly into their bank accounts. No acquaintance rolls, duly verified and signed byDDOs,were found available on record in support of disbursement of amount to concerned employees in violation of Treasury Rules 283 (i).

Department requested for grant of time in the matter and ensured that all the details will be provided to the PAC along with reasons of disbursement of pay in cash by DDOs in district Chaghi.

Parawasdeferredwithdirectivethatinquiryshallbeconductedagainstofficial(s)at fault under intimation to D.G Audit and PAC.

Department informed the Committee that departmental committee has been constituted for probing irregular disbursement of Pay & Allowances to the employees of District Chaghi. Report of Committee is still awaited.

Para was deferred with directive that department shall complete inquiry within one month under intimation to PAC for further consideration.

PARA # 8.2.11: NON-RENDERING OF VOUCHED ACCOUNT – RS. 42.859 MILLION.

Audit explained that the Secretary, Education Department withdrew an amount ofRs.42.859millionduringtheyear2011-16onabstractcontingentbillsbutnoadjustment account was available for audit scrutiny in violation of Para 308 of FTR VoI-I.

Department requested the Committee for the grant of time to resubmit the replies on format as desired by D.G Audit Balochistan and PAC.

On the request of the PAO, Para was deferred with directive to resubmit working papers / reply along with all relevant record to D.G Audit and PAC.

Department informed the Committee that the relevant record has been submitted intheofficeofD.GAuditBalochistan.

Para was deferred with directive that D.G Audit Balochistan shall verify the Vouched Accountswithin15daysunderintimationtoPACforfurtherconsideration.

PARA # 8.2.12: IRREGULAR AWARD OF CONTRACTS WITHOUT INVITING OPEN TENDER – RS. 29.794 MILLION.

Audit explained that the Chairman, Balochistan Text Book Board, Quetta incurred anexpenditureofRs.29.794millionduring2014-15onprintingofvariousbookswithout inviting open tenders in violation of Section 12 (1) of BPPRA Rules.

Rs. in Million

S. No. AIR Para/ Year Amount

1. 6/ 2014-15 1.239

2. 14/ 2014-15 28.555

Total 29.794

Department agreed with the recommendations of D.G Audit and replied that although theofficialscommittedthisirregularityhavebeenretired,stilltheexpenditurewillbe regularized from the Finance Department and inquiry will be conducted against officialsatfaultandCommitteewillbeinformed,accordingly.

Committee deferred the Para with following directives: -

1. Complete inquiry shall be conducted into the matter and responsibility shall befixedagainsttheofficial(s)atfault.

2. Special Audit of the Balochistan Text Book Board from 01-07-2013 to 30-

06-2018 shall be conducted by D.G Audit Balochistan and report shall be submitted to the PAC.

3. Balochistan Text Book Board shall ensure the availability of books to students before the commencement of each Academic Session.

Department informed the Committee that departmental enquiry committee has been constituted on the matter. Report of the committee will be submitted to Public Accounts Committee within 20 days. Moreover, Balochistan Text Book Board has been directed to ensure the availability of books to students before the commencement of Academic Session.

Committee deferred the Para with following directives:

1. PrincipalAccountingOfficer(PAO)SecondaryEducationdepartmentshallconstitute an inquiry committee on the matter and submit report to PAC within 30 days.

2. D.G Audit shall, as directed by PAC, commence Special Audit of Balochistan Text Book Board for the period form 01-07-2013 to 30-06-2018 under intimation to PAC for further consideration.

PARA # 8.2.13: IRREGULAR EXPENDITURE ON ACCOUNT OF REPAIR OF SCHOOLS – RS. 11.370 MILLION.

AuditexplainedthatinthefollowingofficesofSecondaryEducationDepartment,an expenditure of Rs. 11.370 million was incurred on account of repair and maintenance of school buildings during 2014-16 in violation of Government of Balochistan Planning and Development Department Notification No. P&D/RO(Prog)/Gen/2014-15/5146,dated28-01-2015andGFR146

Rs. in Million

S. No. Name of Office AIR Para/Year Amount

1. Deputy District Officer Education (Male), Bori 3/ 2015-16 7.5

2. Deputy District Officer Education (Male), Duki 1/ 2014-16 2.5

3. District Education Officer, Kachi 7/ 2015-16 1.37

Total 11.37

Department explained that the amount under question was released from MPS fund for Private Schools and were expended through Education Department. The Secretary endorsed the recommendation of the D.G Audit and requested the committeetodirecttheinquiryagainsttheofficial(s)atfault.

Parawas deferredwith directives that the PAO shall conduct inquiry and finaloutcome of the inquiry shall be intimated to D.G Audit and PAC within 02 months.

Department informed the Committee that inquiry will be initiated soon under intimation to PAC.

PrincipalAccountingOfficer(PAO)wasdirectedtocompleteinquiryonthesubjectmatter within one month under intimation to PAC. Hence, the Para was deferred.

PARA # 8.2.14: ILLEGAL RETENTION OF GOVERNMENT / PUBLIC MONEY – RS. 6.851 MILLION.

Audit observed that the Secretary Education, Quetta, illegally retained an amount ofRs.6.851millioninaccountNo.4002283092,ofNBPCivilSecretariatbranch,Quetta. Neither authorization of Finance Department for opening an account in a commercial bank was obtained nor was the source of money known. Moreover, no entry about the amount in question was recorded in the cash book in violation of Finance Department (Regulation Wing) Notification No.SO(B&A)1-1/Misc./S&GAD/2008-09/520-52 re-circulated on 23-08-2008 andRules # 283 (2) and290 of Treasury Rules.

Departmentexplainedthatasnon-utilizationoftheamountofRs.6.853million,totalamountincludingprofithavebeendepositedintoGovernmentTreasuryvideChallan No.02 Dated 01-03-2019.

On satisfactory reply of the PAO and as the amount in question has already been deposited in the Government Treasury, the Committee thus settled the Para.

PARA # 8.2.15: UNAUTHORIZED EXPENDITURE WITHOUT PROVISION OF BUDGET – RS. 199.779 MILLION.

AuditobservedthatfollowingofficesofSecondaryEducationDepartmentincurredan expenditure of Rs.199.779 million during financial year 2014-15 withoutprovision of budget in violation of GFR 88, Volume-I, as detailed below–

Rs. in Million

S. NO. Name of Office AIR Para/Year Amount

1.Deputy District Officer Education (F), Zarghoon Town, Quetta

3/ 2014-15 52.988

2.Deputy District Officer Education (M) Chiltan Town, Quetta

4/ 2015-16 146.791

Total 199.779

A.G Balochistan apprised that the Para is related to the Appropriation Accounts hence Finance Department may resolve the issue, he recommended that the Paramaybediscussedat length in themeeting regardingCertificationAuditofAccountant General Balochistan.

The Committee settled the Para to the extent of Education Department. However, thematter shall be discussed at length in themeeting of Certification Audit ofAccountant General Balochistan.

PARA # 8.2.16: UNAUTHORIZED DRAWL FROM CHIEF MINISTER BALOCHISTAN AWARD ACCOUNT – RS. 3.914 MILLION.

AuditobservedthattheSecretaryEducationDepartmentreceivedRs.500millionfrom the Chief Minister Balochistan Award and the same was invested in NBP for a fixedperiodoffiveyears.ThebankstatementrevealedthatanamountofRs.3.914millionwasdrawnfromthataccountbutnojustificationwasmentionedfordrawlof public money and no ledger/record was maintained, which is violation of Para 23 of GFR Volume-I.

Department replied that, incorrect Bank Statement was issued by the bank and

after rectification revised Bank Statement has been obtained. According to therevised bank statement, no cash drawl was made from the account and record is readyforverificationofaudit.

Committee deferred and clubbed the Para with Para No. 8.2.8 and directed that all relevantrecordshallbeprovidedtoD.GAuditforverification.Additionally,inthenext meeting of the Education Department, the respective Bank Manager, shall also be taken onboard for discussion on the matter.

Department apprised the forum that original record, in respect of the subject observation,hasbeenshiftedtotheofficeofBalochistanEducationEndowmentFund(BEEF).However,copyofrecordverifiedfromBEEFofficeshallbeprovidedto Audit.

CommitteesettledtheParasubjecttoverificationofrecordbyAuditunderintimationto PAC.

PARA # 8.2.17: NON DEDUCTION OF GOVERNMENT TAXES – RS. 5.661 MILLION.

AuditpointedoutthatindifferentofficesoftheSecondaryEducationDepartment,income tax and GST were not deducted from the bills of suppliers / contractors, duringF.Y2014-16resultingintoalossofRs.5.661milliontothepublicexchequerindischargeofSection153ofIncomeTaxOrdinance,2001.

Department explained that often such issues emerge in far-flung districts ofBalochistanduetonon-availabilityofregisteredfirms.However,theDDOconcernedhas been directed to affect recovery and deposit the amount in Government Treasury.

Para was deferred with directives that the recovery of Government taxes shall be effected from the concerned suppliers/ contractors under intimation to audit and responsibilityshallalsobefixedagainstofficialsatfault.

Department informed the Committee that an amount of Rs. 5.661 million, onaccount of taxes, has been recovered and deposited in Government Treasury. CopiesofthedepositedChallanareavailableforverification.

ParawasdeferredtillnextmeetingwithdirectivetoPrincipalAccountingOfficer(PAO) that previous directives of the PAC shall be strictly implemented under intimation to PAC.

PARA # 8.2.18: LESS DEDUCTION OF INCOME TAX FROM CONTRACTORS – RS. 1.350 MILLION.

Audit observed that Chairman Balochistan Text Book Board, Quetta incurred an expenditureofRs.59.045millionduring2014-15onpurchaseofprintingpapersbut income tax was not deducted at prescribed rate which resulted in less realization ofRs.1.350milliononaccountofincometaxindisregardofSection153ofIncomeTax Ordinance, 2001.

Rs. in Million

S. NO. Name of firm Item Amount Tax Due

Tax deducted @ 1.71%

Less deducted

1.M/S A.A Paper Private Limited Islamabad.

700 MT High Finished Printing Paper 20 X 30 68 GSM

59.045 2.362 1.012 1.350

Department explained that clarified that only 500metric tons ofHigh FinishedPrinting Papers 20*30/68 was purchased by the department. He further added that 4% income tax amounting to Rs.1,687,000 was withheld from the supplier out of which an amount of Rs.1,012,200 was deposited in Government Treasury throughChequeNo.07153473dated10-02-2015.Moreover,theremainingamountof Rs.674,800 was not deposited to FBR because the supplier submitted the ExemptionCertificateu/s153 (1)(a) readwithsection153(4)of the IncomeTaxOrdinance 2001.

Para was settled subject to depositing of the remaining amount of tax in Government Treasury under intimation to D.G Audit and PAC.

Department apprised the Committee that recovery has been effected, deposited inGovernmentTreasuryandverifiedbytheAudithence,requestedtheforumforsettlement of the Para.

AstherecoveryofincometaxhasbeenverifiedbytheAudit,therefore,Committeesettled the Para.

PARA # 8.2.19: NON-DEDUCTION OF HOUSE RENT AND CONVEYANCE ALLOWANCE – RS. 1.330 MILLION.

AuditpointedoutthatinsomeofficesoftheSecondaryEducation,anamountofRs.1.330 million was paid on account of Conveyance Allowance during 2014-16 to theofficialswhowereallottedwithgovernmentvehiclesinviolationofGovernmentofBalochistanS&GADNotificationNo.SGA(TPT)1-3/94/570-750datedJuly24,2004

DepartmentexplainedthatrecoverieswillbeaffectedfromofficerswhoareusingGovernment vehicle and taking Conveyance Allowance in cash under intimation to audit.

Parawassettledwithdirectivesthatcertificatesprovidedbythedepartmentshallbeverifiedandrecoveryshallbeaffectedfromallin-serviceandretiredemployeesunder intimation to D.G Audit and PAC. Whereas, the amount recoverable from deceased employees shall be waved-off.

Department informed the Committee that recovery has been effected from the concernedemployees;recordisreadyforverification.

ParawassettledsubjecttoverificationofrecoveryChallanbyD.GAuditBalochistanunder intimation to PAC.

UNIVERSITY OF BALOCHISTAN AND AREA STUDY CENTER

(Meeting held on 7th August, 2019)

INTRODUCTION

The University of Balochistan, Quetta is the oldest educational institution of higher studies in the Province entrusted with the responsibilities to educate and train potentially talented human resource and manpower to meet the emerging needs of the industry and society. It plays a vital role in development of Pakistan in general and Balochistan Province in particular.

PAC OBSERVATIONS

The most serious and dominant issue in the Audit Paras of University of Balochistan wasrecoveryofRs.91.57milliononaccountofScholarshipspaidto65Lecturers/Assistant Professors of the University for PhD. study at different universities abroad. Outofthe65candidates13didnotreturnbacktoresumetheirdutiesasperthecontract agreement.

Besides aforesaid issue, the instances of unauthorized and irregular payments and issuance of 29 Laptops to the employees of the University instead of eligible students were also observed

Recoverables37%

UNIVERSITY OF BALOCHISTAN AND AREA STUDY CENTER126

4. Paras Settled 01

Total 08

OneauditParawassettledby theCommitteeafterobtaining justificationof themanagement of University. However, rest of the Paras were deferred/settled subject to conditions on which compliance will be obtained in the next PAC meeting of the University.

Paras Deferred

Rs. in Million

Recovery Effected

Total 08 114.95 -

The biggest chunk of the graph represents recovery on account of PhD. Scholarship from 13 absconded Lecturers/Assistant Professors, Conveyance Allowance and Repair & Maintenance Charges of bungalows and quarters from the employees of University residing in the colony of the University.

NorecoveryinformationwascommunicatedtothePACsectiontillthefinalizationof this report.

139.77

Recoverables

Loss Sustained by the Govt.

Recovery Effected Audit Observation

Rs. in Million

Director General Audit, Balochistan explained that Non-Development funds amountingtoRs.1,951.35millionwereallocatedtotheUniversityofBalochistanduringthefinancialyear2015-16.Againstthesaidallocation,anexpenditureofRs.1,608.18millionwasincurred,assummarizedbelow―

Rs. in Million

Supp. Grant

Surren-der

Final GrantExpendi-

tureExcess/

(Savings)%

Non-Development - - - 1,701.80 1482.00 (219.80) 12.92

Development Agriculture

Extension & Research- - - 249.55 126.18 (123.36) 49.43

Total - - - 1,951.35 1,608.18 (343.16) 17.59

Saving of Rs. 343.16 million on development and non-development expenditures indicatesimproperbudgetingandfinancialmismanagement.

REPLY OF THE UNIVERSITY MANAGEMENT:

Treasurer UoB contended the statement provided in the Audit Report under referenceandexplainedthatowingtomisprintingoranyotherreasonthefiguresarenotmatchedwiththeactualfigures.Allexpenditurehastimelybeenconsumedand utilized.

PAC DIRECTIVE(S)

Due to erroneous Audit statement and on the request of University Management/Administration, the Committee deferred the Examination of Appropriation Accounts for Financial Year 2016-17 till next PAC meeting.

PARA # 9.2.1: NON RECOVERY OF SCHOLARSHIPS FROM DEFAULTERS – RS. 91.565 MILLION.

AuditobservedthatthemanagementofUniversityofBalochistansent65Lecturers/ Assistant Professors who were awarded scholarships for PhD study at different universities abroad. Out of which 13 Lecturers / Assistant Professors neither completed their studies nor returned back to the University, causing a loss of Rs. 91.565milliontotheGovernment,paidtothemasscholarships.

Vice Chancellor University of Balochistan apprised that UoB had obtained a scholarship scheme from a federally funded project namely “Mega Project” for its facultymembers to gethigher education.He further explained that53scholarshavereturnedbackoutof65andhavebeenperformingtheirdutiessincethen.However, 12 scholars still stand absconders. Final Notices to them as well as to their guarantors have been issued and UoB management is taking utmost efforts to bring them back. Moreover, as per SOP of the HEC, legal proceedings are also being initiated which may include investigation through FIA.

PAC DIRECTIVE(S)

After surety given by the Vice Chancellor University of Balochistan, the Committee accorded 06 months’ time to solve the issue under reference. In case of failure, the University management was directed to recover all expenses incurred on the scholars plus penalty as per the duly notarized documents. Besides, the case be forwarded to the Federal Investigative Agency (FIA) for legal proceedings and the ForeignOfficeforpursuingthereturnofabscondersunderintimationtoCommitteefor further consideration. The Para was hence, deferred.

PARA # 9.2.2: RECOVERY OF CONVEYANCE ALLOWANCE - RS. 25.325 MILLION.

Audit pointed out that the management of the University of Balochistan, unauthorizdelypaidconveyanceallowanceamountingtoRs.25.325millionduring2015-16to theofficersandofficialsofUniversitywhowereallottedGovernmentaccommodations within the University premises which violates Finance Division’s OMNo2(2)P-5/83,datedApril10,1988,andnumber2(1)R-5/991,datedAugust25,1991.

Treasurer, UoB explained that the Colony and work premises of University are separate. Being an autonomous body the University Syndicate has already declared that colony stands segregated from the work place premises and allowed conveyance allowance facility to the employees residing in colony.

PAC DIRECTIVE(S)

TheCommitteesettledtheParasubjecttoprovisionoftheAdministrativeCertificatefrom Vice Chancellor, University of Balochistan duly certifying the colony segregation fromworkpremisestoAuditforverificationunderintimationtothePAC.

PARA # 9.2.3: RECOVERY OF 5% REPAIR AND MAINTENANCE CHARGES – RS. 22.876 MILLION.

Audit observed that the management of the University of Balochistan did not make mandatory recovery of 5% repair and maintenance charges from the residentsof University bungalows and quarters, amounting to Rs. 22.876 million during 2015-16,violatingFinanceDivision’sOMNo2(2)P-5/83,datedApril10,1988,andnumber2(1)R-5/991,datedAugust25,1991.

University Management explained that Public Sector Universities are autonomous bodies and their rules are framed as per Act approved by their Syndicate and

Senate.Theemployeesusingofficialaccommodationareresponsiblefortherepairand maintenance of house allotted to them and at the time of vacation of house, employee concerned is responsible to handover the house in maintained conditions. ThedepartmentfurtherclarifiedthatonanalogyoftheUniversityofPunjab,matterof exemption of repair and maintenance allowance have been placed before the Senate and Syndicate for decision. However, case is pending for the approval which will be shared with the Audit and PAC as and when meeting is convened.

PAC DIRECTIVE(S)

The Committee directed the University management to strictly prohibit the allottees forencroachment/modificationinhousestructureandtoretaintheallottedhousesas per architectural plan. The University management was also directed to provide the Syndicate approval regarding exemption of repair and maintenance allowance to the allottees and place it before the Committee for further consideration. The Para was thus, deferred.

PARA # 9.2.4: UNAUTHORIZED PAYMENT OF HOUSE RENT ALLOWANCE - RS. 2.258 MILLION.

Audit pointed out that the management of the University of Balochistan failed to recover house rent allowance from the officers and officials of the universityoccupying houses in the University colony by depositing only Rs.800/- monthly besides they were regularly drawing house rent allowance. Thus the University putintolossofRs.2.258millionduetonon-deductionofhouserentfromtheseemployees in violation of FinanceDivision’sOMNo 2(2)P-5/83, dated April 10,1988,andnumber2(1)R-5/991,datedAugust25,1991.

Treasurer, UoB explained that in light of the DAC directives, outstanding amount is being recovered from the date of allotment on monthly basis. Remaining amount will be recovered in due course of time which would be intimated to the audit.

PAC DIRECTIVE(S)

The Para was deferred with the directives to effect the outstanding amount from defaulters with effect from the date of allotment of accommodation and place it before PAC for further consideration.

PARA # 9.2.5: UNAUTHORIZED ISSUANCE OF LAPTOPS TO EMPLOYEES - RS. 1.317 MILLION.

Audit observed that the management of the University of Balochistan purchased 370 laptops, during 2013-14 for the 11thConvocationheldon15th May 2014. Total 341 laptops were distributed to the eligible students remaining 29 laptops valuing Rs.1.317millionweredistributedto theofficersof theUniversity.These laptopswere given by the Chief Minister Balochistan exclusively for students and could not be given to the University employees.

University Management in response thereof, explained that the laptops were distributed on occasion of 11th Convocation by the Chief Minister. However, 29 students remained absent in the convocation whom were tried to trace by management but in vain. The laptops were lying in store for more than two years and in order to avoid damage to its power bank, it was decided to use them for official work, hence laptops were distributed among Deans/ faculty memberson their written request. However, as per DAC directives the request for grant of permission of the ChiefMinister for use of Laptops for official purpose is lyingbeforeChiefMinisterOfficeforapproval.KeepinginviewofjustificationtheParamay kindly be dropped.

PAC DIRECTIVE(S)

The Committee settled the Para subject to obtaining approval of the Chief Minister pertainingtotheuseofLaptopsforofficialpurposewithinthreemonths.Incaseoffailure,recoverybemadefromofficersconcernedunderintimationtothePAC.

PARA # 9.2.6: IRREGULAR EXPENDITURE ON RENOVATION OF MAIN GATE – RS. 4.452 MILLION.

Audit pointed out that the management of the University of Balochistan awarded the work “Renovation & Development of University Main Pedestrian Gate” to M/s SalamTraders,Quetta forRs. 4.452million. In violation of Para 220 and Para221 of CPWA Code, the expenditure was thus, held irregular due to the following reasons:-

1. Tender was not uploaded on the PPRA web site.

2. The work was carried out on item rate basis.

3. Technical sanction from the competent authority was not obtained.

4. The measurement recorded in the MB and Abstract of cost & Quantity was neither signed by any of the Engineers nor allotted with the proper number.

5. Estimate / PC-1 was not prepared.

University Management explained that following the DAC directives all relevant record including Original Estimate/PC-1, Tender advertisement in the newspapers, TechnicalSanction,MBsetc.weresubmittedtoauditforverificationwhereinsomediscrepancies were discussed point wise. Keeping in view Para may kindly be settled.

PAC DIRECTIVE(S)

TheCommitteeSettledtheParasubjecttoverificationofrecordbytheAuditunderintimation to PAC.

PARA # 9.2.7: LOSS DUE TO NON-DEDUCTION OF CONVEYANCE ALLOWANCE FROM EMPLOYEES ON PICK AND DROP FACILITY- RS. 2.912 MILLION.

Audit observed that the management of the University of Balochistan was not making necessary deduction of the conveyance allowance from the salaries of officersandofficialswhowereavailingthefacilityofpickanddropfromandtotheUniversity amounting to Rs .2.912 million.

Audit further apprised the forum that according to the Government of Balochistan Services and General Administration Department, Notification No SGA (TPT)1-3/94/570-740,datedJuly242000,underS.No.4(6),readwithFinanceDepartmentnotification dated 1977, “The officers/officials who are availing the facilities oftransport facility are not entitled to draw conveyance allowance”.

University Management explained that matter was discussed in two DACs wherein it was decided to rationalize the rates. Consequently, the authority enhanced the rates in September 2017 which has been implemented and the deduction was initiated thereof. The management assured that 10% rates would further be enhanced from October 2019 and after completion of three years each. Keeping in view Para may kindly be settled.

PAC DIRECTIVE(S) -

Keeping in view of the justification made by the University management, theCommittee Settled the Para.

PARA # 9.2.8: NON-ADJUSTMENT OF TEMPORARY ADVANCES - RS. 4.206 MILLION.

Audit pointed out that the management of the University paid advances amounting toRs.6.963millionduring2015-16tovariousadministrativeandteachingstaffoftheUniversity.Outofthesaidadvance,anamountofRs.2.757millionhadbeen

adjusted, leaving a balance of Rs.4.206 million in violation of Clause 9.1 of Section VIII of UoB Financial Rules.

UniversityManagementexplainedthatoutofoutstandingamountRs.3.501millionRs. 4.206 million has already been recovered. The remaining outstanding amount was for sports activities which will be adjusted within a month.

PAC DIRECTIVE(S)

The Para was deferred with the directives to adjust the outstanding amount within two months. In case of failure, recovery be effected under intimation to the PAC for further consideration.

AGRICULTURE AND COOPERATIVES DEPARTMENT

(Meeting held on 27th August, 2019)

INTRODUCTION

The basic function of Agriculture and Cooperative Department is to introduce new varieties of seeds of agriculture products to achieve maximum yield, and improvement of farms through development of infrastructure i.e. water courses, trickle irrigation system and storage water tanks etc. Moreover, to assist farmers by providing advisory services in plant protection and agriculture farming through theirfieldstaffisacoredutyoftheDepartment.

PAC OBSERVATIONS

While examining the Audit Report 2017-18 it was observed that most of the Audit Paras in Agriculture & Cooperatives Department were pertaining to Irregular Expenditure resulted from non-adherence to the General Financial Rules, Balochistan Public Procurement Regulatory Authority Rules 2014 and Central Public Works Account Codes. Beside Irregular Expenditure, instances of Recoverables and Doubtful Expenditure were also observed as evident from the following Doughnut:

Recoverables 12%

Although, Irregular Expenditure does not necessarily recommend recovery, however, the business of the Government to achieve its objectives and targets is badly affected

Total 08

Three Paras were deferred with the directives to the PAO to re-investigate into the matter of doubtful/irregular expenditure on account of Petrol, Oil & Lubes (POL) and repair of Vehicles. Rest of the Paras representing 63% of the Pie Chart were settledsubjecttoconditionsofverificationofrecordbytheAuditandregularizationof expenditure from the competent authority.

Paras Deferred

Paras Se�led Subject toCondi�on(s)

AGRICULTURE AND COOPERATIVES DEPARTMENT138

Rs. in Million

# Audit Observations No. of Paras Amount of Observation

Recovery Effected

3. Doubtful Expenditure 01 4.25 -

Total 08 73.62 -

FormostoftheParasauditrecommendedfixingofresponsibilityandregularizationof expenditure, therefore, no recovery is depicted in the above table and bar chart. Moreover, the Recoverables of Rs.1.87 million, on account of House Rent &ConveyanceAllowance,weresettledsubjecttofullrecoveryandverificationofrecovery record by Audit.

Recoverables

Rs. in Million

PAC DIRECTIVE(S)

Due to non-submission of the departmental reply/comments on the Appropriation Accounts for Fiscal Year 2016-17, the Committee deferred the Appropriation Accounts pertaining to the Agriculture and Cooperatives Department till next meeting.

PARA # 10.2.1: DOUBTFUL EXPENDITURE ON POL - RS. 4.245 MILLION.

Audit pointed out that in violation of Para-23 GFR Vol-I, the Director General Agriculture(Extension)Quetta,drewanamountofRs.4.245million,during2015-16, and shown paid to M/s Bukhari Petroleum Service Quetta, on account of supply of POL. Audit was of the view that expenditure without supporting documents was doubtfulandrecommendedinvestigatingthematterandfixingresponsibility.

Audit further apprised the forum that while checking the logbooks it was revealed that entries for the above drawl were not recorded, as detailed below–

Rs. in Million

Cheque No/ date Firm Description Amount

107642922-12-2015

M/s BukhariPetroleum Service,

Quetta

July 2015 0.534

Sep 2015 0.535

Oct 2015 0.566

Nov 2015 1.020

Dec 2015 1.011

Oil & Lubricants 0.578

Total 4.245

Secretary Agriculture explained that in the light of DAC directives an inquiry committee was constituted to probe into thematter and fix responsibility. Thereport of the committee has been submitted to the Audit. However, he expressed reservationsoverTORsandrecommendations/findingsoftheinquirycommitteebut ensured that the Department will endorse directives of PAC in letter and spirit.

PAC DIRECTIVE(S)

Keeping in view of the PAO’s stance over inquiry committee’s report, the department was directed to re-investigate the case in light of TORs as suggested by the DAC tofindoutthefactsandfixresponsibilityagainstpersonsatfaultwithin45daysunder intimation to the PAC for further considerations. The Para was thus, deferred.

PARA # 10.2.2: NON-DEDUCTION OF HOUSE RENT AND CONVEYANCE ALLOWANCE - RS. 1.869 MILLION.

AuditobservedthatinsomeofficesoftheAgricultureDepartment,Balochistan,anamount of Rs.1.869 million, was paid during 2014-16, on account of House Rent Allowance andConveyanceAllowance to the officials providedwithGovernmentaccommodation and vehicles by the department, in violation of Finance Division OMNo2(2)P-5/83,datedApril10,1988,andNo.2(1)R-5/991,datedAugust25,1991andtheFinanceDepartmentGovernmentofBalochistanNotificationdated18th May 1977.

Rs. in Million

S. No. Name of formation Year Amount

1. DG Agriculture Extension 2014-15 0.120

2. DG Agriculture Extension 2014-15 0.724

3. Principal Agriculture collage 2015-16 1.025

Total 1.869

Department explained that in compliance of the DAC directives and as per audit observations, recovery of outstanding dues in respect of conveyance allowance and house rents allowance is being deducted from the monthly salary of defaulters. The remaining outstanding amount will be realized soon in due course of time.

PAC DIRECTIVE(S)

Keeping in view of the departmental reply the Committee settled the Para subject to verificationofrecordbyauditunderintimationtoPAC.

PARA # 10.2.3: NON–ACHIEVEMENT OF REVENUE TARGETS - RS. 3.435 MILLION.

Audit observed that in the following offices of the Agriculture Department, anamountofRs.3.435million,during2014-16,revenuetargetsforsaleproceedsofagriculture products of Model Farms set by the Government were not achieved:-

Rs. in Million

S. No. Office F.Y TargetFixed

TargetAchieved Difference

1. DD Agriculture Date Farm, Turbat2014-15 1.500 1.390 0.110

2015-16 3.500 1.326 2.173

2. DD Agriculture Model Farm, Sibi 2015-16 2.154 1.002 1.152

Total 3.435

Audit was of the view that non achievement of revenue targets resulted in loss to the government.

Department apprised the forum that fixing excessive revenue targets withoutincreasingthebudgetaryinputsisunjustifiablewithintheprevailingconditions.

TheFinancedepartmentdespiteseveralrequestsdidnotrationalizethetargetfixedforfiscalyearunderreference(2018-19).Thesamehasalsobeenendorsedbyaninquiry conducted by the CMIT on account of non-achievement of revenue targets. However, in compliance of the DAC directives the matter was taken up with the Finance Department for rationalization of receipt target. Consequently, the receipt target has been rationalized by the Finance department. On the basis of above facts, the department requested for settlement of the Para.

PAC DIRECTIVE(S)

Since the receipt target has been rationalized by the Finance department, the CommitteesettledtheParasubjecttoverificationofrecordbyauditunderintimationto the PAC.

PARA # 10.2.4: IRREGULAR EXPENDITURE ON EXECUTION OF EARTHWORK – RS. 21.672 MILLION.

Audit pointed out that the Deputy Director, Agriculture Engineering Department, Chaghi,incurredanexpenditureofRs.21.672million,during2015-16,ontractorhours used for leveling of agriculture land out of Public Representative Program. The expenditure was held irregular because detail of land leveled, estimates and measurement books, earth work statement and ownership documents were not available on the record of the department.

Audit further apprised that according to CPWA Code, Para 208, “All payment for work done and supplies shall be made on the basis of measurement recorded in MB”

Department explained that as per directives of the DAC, relevant documents including earth work statement, detail of land which were leveled along-with ownershipandcompletiondocumentshavebeenprovidedtoauditforverification.Therefore, Para may kindly be dropped/settled.

PAC DIRECTIVE(S)

Keeping in view of the departmental reply, the Committee settled the Para subject toverificationofrecordbyauditunderintimationtothePAC.

PARA # 10.2.5: EXCESS CONSUMPTION OF POL ON BULLDOZER HOURS – RS. 7.442 MILLION.

Audit observed that the Agriculture Engineering Department, Sibi incurred an expenditure ofRs. 7.442million during 2014-15, on POL charges of bulldozershours in excess of prescribed ceiling. Audit was of the view that excess consumption of POL resulted in loss to the Government.

Audit further shared that According to Scale provided by Electrical and Mechanical Workshop Division Quetta, “The Caterpillar Dozer D-6 consumes POL @ 21 liter per hour”.

Department explained that the detail/record of actual consumption of POL have been provided to the audit. As per departmental record, excess expenditure was not incurred on POL as the Audit did not consider expenditure incurred on vehicles. Apart from Audit observation other miscellaneous charges were also consumed. However, the PAO ensured to act upon directives issued by the committee into the matter in full spirit.

PAC DIRECTIVE(S)

The department was directed to conduct inquiry into the matter within 2 months and submit report thereof to the PAC for further consideration. The Para was thus deferred.

PARA # 10.2.6: IRREGULAR EXPENDITURE ON REPAIR OF VEHICLES– RS. 5.794 MILLION.

Audit observed that the Director General Agriculture Extension, Quetta, incurred anexpenditureofRs.5.794milliononrepairsofvehiclesduringtheyear2014-15.The expenditure was made without sanction of the competent authority. Moreover, the tendering process is illegal and doubtful because only two days were given for submission of bids and acceptance of tenders. Further, the defect reports of machinery and dismantled parts registers were not available.

Audit shared Para No. 9 of GFR, Vol-I for ready reference that no authority may incur expenditure or enter into liability involving expenditure form public funds until the expenditure has been sanctioned by an authority to which power has been duly delegated.

PAC DIRECTIVE(S)

The Committee clubbed the Para with Para # 10.2.1 and directed the PAO to re-investigatethecaseinlightofTORsassuggestedbytheDACtofindoutthefactsandfixresponsibilityagainstthepersonsatfaultwithin45daysunderintimationto the PAC for further considerations.

PARA # 10.2.7: AWARD OF CONTRACT IN VIOLATION OF BPPRA RULES – RS. 3.061 MILLION.

Audit observed that the Director General Agriculture (Extension) Balochistan, Quetta incurred an expenditure of Rs.3.061 million, during 2014-16, without constituting purchase committees, posting tenders on the website of BPPRA and publishing it in widely circulated newspapers, as summarized below–

Rs. in Million

S. No. Name of formation Year Amount

1. DG Agriculture extension 2014-15 1.198

2. DG Agriculture extension 2015-16 1.863

Total 3.061

Departmentexplainedthatinexigencyofofficialwork,therepairwasmadetoruntheofficialroutinesmoothly.However,inthelightoftheDACdirectives,acaseforregularization is pending in Finance department for ex-post facto approval.

PAC DIRECTIVE(S)

Keepinginviewofthedepartmentaljustification,theCommitteesettledtheParasubjecttoverificationoftheregularizationcasebyauditunderintimationtothePAC.

PARA # 10.2.8: BURDEN ON GOVERNMENT EXCHEQUER WORTH RS. 26.100 MILLION.

Audit observed that the Agricultural Engineering Workshop, Quetta, during 2014-15,incurredandexpenditureofRs.26.100milliononaccountofsalariesofdriversand cleaners deployed on bulldozers and light transport. It was noticed that there are only 17 bulldozers and 9 light transports vehicles against which excessive staff was deployed and is drawing salaries from the Government exchequer, in disregard to rule (i) GFR Vol-I, as detailed below

Rs. in Million

S. No Description No of

employees Difference Monthly salary Period Amount

1. 17 (Bulldozer) 37 operators 20 0.03501-07-2014 to

30-06-20158.400

2. 17 (Bulldozer) 52 cleaners 35 0.02501-07-2014 to

30-06-201510.500

3. 9 (light transport) 19 drivers 10 0.03501-07-2014 to

30-06-20154.200

4. 9 (light transport) 19 cleaners 10 0.02501-07-2014 to

30-06-20153.000

Total 26.100

Department explained that the surplus staff has been engaged in various shops of Quetta workshop. Besides, a fleet of 85 new bulldozers have been received.Accordingly, the surplus staff would be adjusted against these bulldozers. Moreover, departmentisintendingtopurchase115newbulldozersinnearfuture,therefore,the remaining surplus staff would also be utilized there.

PAC DIRECTIVE(S)

Keepinginviewofthedepartmentaljustification,theCommitteesettledtheParasubjecttoverificationofrecordbytheaudit.

POLICE (Meetings held on 25th September & 11th December, 2019)

INTRODUCTION

The Police department has been established for maintaining public peace and order. ThePoliceforceworkstopreventhighwayrobberies,enforcetrafficdiscipline,preventhouse robberies & street crimes, counter terrorism, sectarianism, extremism and security of sensitive installation, foreigners and dignitaries.

PAC OBSERVATIONS

While examining the Audit Report 2017-18 it was observed that most of the Audit Paras in Police Department were pertaining to Irregular Expenditure on account of violation of Delegation of Financial Power 2008, Federal Treasury Rules, Standing Orders of the Finance Department, Government of Balochistan and most importantly MotorVehicleOrdinance1965.

AsperSection23oftheMotorVehicleOrdinance1965“Nopersonshalldriveanymotor vehicle and no owner of a motor vehicle shall cause or permit the vehicle to be driven in any place unless the vehicle is registered. In examination of the Audit Paras of the Police it was surprisingly noted that 1407 vehicles are being used in the operations of department without registration.

POLICE 148

3. Paras Settled 01

Total 05

OnthebasisofjustificationgivenbythePAOoneParawassettledbytheCommittee,whereas rest of the Paras were settled subject to the conditions of regularization of expenditure from the competent authority and registration of 1407 vehicles of the department on priority basis.

Rs. in Million

Recovery Effected

Total 05 30.02 -

Paras Se�led

As all of the Audit Paras were related to violation of rules and regulations and no overpaymentwasidentifiedbytheAudit,therefore,norecoveryisdepictedintheabove bar chart.

The Deputy Accountant General Balochistan, briefed the Committee about the Appropriation Accounts of Police and apprise that on the direction of PAC, the figureshavebeenreconciled,assummarizedbelow-

Rs. in Million

Supp. Grant

Surrender Final Grant Expendi-tureExcess/

(Savings)%

Non-Development

(Grant No.BC21008)1,5342.57 567.57 - 1,5910.14 1,5280.26 (629.88) 3.96

Development

Function No.032102365.09 1,342.92 (841.94) 866.07 745.94 (120.13) 13.87

Total 1,5707.66 1,910.49 (841.94) 1,6776.21 1,6026.21 (750.01) 4.47

Rs. in Million

POLICE 150

Figures of the Appropriation Accounts presented by the department were not matched with those presented above by the Accountant General Balochistan, therefore, Chairman Committee deferred discussion on the Appropriation Accounts with the remarks that those departments who are not surrendering the savings timely to the Finance Department are deferring the economic development of the province.

PAC DIRECTIVE(S) (25TH SEPTEMBER 2019):

Discussion on the Appropriation Accounts was deferred with directive that the PolicedepartmentandAccountantGeneralBalochistanshallreconcilethefiguresand respond to the PAC within two months. Furthermore, the Secretary Home Department shall provide detailed report over Supplementary Budget 2016-17 to PAC Secretariat.

Departmentinreplythereof,sharedthatonthedirectionofPAC,figureshavebeenreconciledwithAGofficehencerequestedtheforumforsettlementoftheagendaand ensured to minimize the saving/excess, in future.

ThePACregularizedthegrants/figure&settledtheagendaitem#01withdirectivethat the PAO shall ensure zero saving & excess, in future.

PARA # 11.2.1: UNAUTHORIZED EXPENDITURE DUE TO NON-ALLOCATION OF FUND – RS. 4.048 MILLION.

Audit observed that The Chief Pilot Provincial Police Flight Balochistan, during the year2015-16,incurredthefollowingexpenditureofRs.4.048milliononaccountofpay and allowances of contract employees of the department without allocation of funds, in violation of GFR 9 Vol-I:-

Rs. in Million

S. No. Head Budget Expenditure

1. Basic Pay Nil 0.208

2. Pay of Contract Nil 1.200

3. Basic Pay Nil 0.401

4. House Rent Nil 0.946

5. Con Allowance Nil 0.915

6. Dress Nil 0.058

7. SAA Nil 0.093

8. Tele Communication Nil 0.020

9. AR 2015 Nil 0.207

Total 4.048

The Additional Chief Secretary (PAO), Home & Tribal Affairs Department, explained that the request of the Police department for the regularization of subject expenditure is forwarded to Finance Department vide letter No. (Police) 1-2/2019/6109-6112 on 23rd August 2019.

Para was settled subject to regularization of subject expenditure by Finance and Police Department within 2 months under intimation to PAC.

Department apprised the forum that case for regularization of the said expenditures vide letter No. 34117/10-A(270)/Audit dated 21st Aug 2019 has been forwarded by the PAO to Finance Department vide letter NO. (Police) 1-2/2019/6109-6112 dated 23rd Aug 2019.

POLICE 152

PAC deferred the Para with directive that the expenditure be regularized before December 31, 2019 under intimation to PAC for further consideration.

PARA # 11.2.2: IRREGULAR EXPENDITURE ON REPAIR OF VEHICLES – RS. 10.220 MILLION.

Audit observed that in some office of PoliceDepartment, an expenditure of Rs.10.220 million was incurred on repair of vehicles, on repair of furniture, purchase of stationery, repair of machinery & equipment, repair of transport and on printing during2013-14,2014-15and2015-16inviolationofS.No.16(2)ofDelegationofPower 2008.

The expenditure was held irregular due to the following reasons:-

•• The expenditure was incurred by splitting up to avoid open tender system.

•• The expenditure was incurred beyond powers delegated to him.

•• Dismantle parts register were not available.

•• NOC from MMD/ SSP MT were not obtained and in some cases repetition of identical nature of items were purchased.

Department explained that the request of the Police department for the regularization of subject expenditure is forwarded to Finance Department vide letter No. (Police) 1-2/2019/6101-6104 on 23rd August 2019.

The Para was settled subject to regularization of subject expenditure by Finance Department and Police Department within 2 months under intimation to PAC.

Department explained that case for regularization of the said expenditures vide letter No. 34116/10-A(270)/Audit dated 21st Aug 2019 has been forwarded by the PAO to Finance Department vide letter NO. (Police) 1-2/2019/6109-6112 dated 23rd Aug 2019.

PARA # 11.2.3: ADVANCE PAYMENT ON ABSTRACT BILL – RS. 8.009 MILLION.

Audit observed that The Deputy Inspector General Police, Quetta withdrew anamountofRs.8.009millionduring2014-15,onabstractbill inadvance forMuhram-ul-Haram duties for which no vouched accounts was presented to audit, in violation of Para 308 of FTR Vol-I. Audit was of the view that the expenditure was held irregular in the absence of detailed vouched account.

Rs. in Million

Order No. & Date Billing Month Cheque No. & Date Particular Amount

Sanction No.1/10-B/AB dated 29-10-14

October, 2014090727230-10-14

Muhram-ul-Haram duties

Department explained that in compliance of DAC decision, requisite record was submitted toAudit forverificationvide letterNo.34121/10-A (270)/Auditdated21st August, 2019.

POLICE 154

Keeping in view the urgency of the matter and submission of the vouched accounts by the department to D.G Audit Balochistan, the Committee decided to settle the Para. Moreover, it was directed to the Finance Department that, in future, funds related to the activities of Muhram-ul-Haram shall be released before three months of the event.

PARA # 11.2.4: IRREGULAR EXPENDITURE DUE TO NON-CALLING OF OPEN TENDERS – RS. 7.740 MILLION.

AuditpointedoutthatinthefollowingofficesofPoliceDepartment,anexpenditurewas incurred on Feeding Charges during Muharam-ul-Haram amounting to Rs. 7.740millionwithoutinvitingopentendersinleadingnewspapersduring2014-15and2015-16:-

Rs. in Million

S. No. Name of Office Description F.Y Amount

1. The Deputy Inspector General Police, Quetta, Feeding Charges 2014-15 6.335

2. District Police Officer, Jaffarabad. Feeding Charges 2014-16 0.923

3.Superintendent of Police, Zonal Commander Balochistan, Constabulary, Zone- I, Quetta.

Feeding Charges 2015-16 0.241

4.Zonal Commander, Balochistan, Constabulary, Zone-III, Quetta.

Feeding Charges 2015-16 0.241

Total 7.740

Department explained that the request of the Police department for the regularization of subject expenditure is forwarded to Finance Department vide letter No. (Police) 1-2/2019/6105-6108on23rd August, 2019.

Para was settled subject to regularization of subject expenditure by Finance Department and Police Department within 2 months under intimation to PAC.

Department explained that case for regularization of the said expenditures vide letter No. 34120/10-A(270)/Audit dated 21st Aug 2019 has been forwarded by the PAO to Finance Department vide letter NO. (Police) 1-2/2019/6109-6112 dated 23rd Aug 2019.

PARA # 11.2.5: NON - REGISTRATION OF GOVERNMENT VEHICLES.

Audit pointed out that in the Police Department, following vehicles and motor cycles were not registered with the Excise and Taxation Department during the years 2012to2016,inviolationofSection23oftheMotorVehicleOrdinance,1965,asdetailed below–

S. No. Name of Offices Description No. of Un-registered

Vehicles Year

1.Deputy Inspector GeneralPolice, Quetta/CCPO.

Unregistered Vehicles

157 Light Vehicles and 264 Motor Cycles

2013-14 and 2014-15

2.Commandant, Balochistan Constabulary, Quetta.

58 Light Vehicles. 2015-16

3.Senior Superintendent of Police Telecommunication, Quetta.

10 Light Vehicles and 22Motor Cycles

2012-16

4.District Police Officer, Naseerabad at Dera Murad Jamali.

18 Vehicles and 37 Motor Cycles

2014-16

POLICE 156

Department apprised the forum that due to the budget constraints in current F.Y the vehicles could not be registered. Moreover, the Board of Revenue, has directed to the quarter concerned for the registration of vehicles, provision of embossed Number Plates and Booklets of 1407 unregistered vehicles. As and when the registration process is completed, the same will be furnished to PAC.

Para was settled with directive that the department shall initiate the summary for additional grant to the Finance Department on account of registration of 1407 vehicles under intimation to PAC. Moreover, Committee remarked that, to ensure law & order situation in the province the department shall implement it itself with zeal and zest.

In the context of aforesaid directive Finance Department was directed to prioritize the release of funds for registration of vehicles.

Department apprised that the Board of Revenue, Balochistan (Excise, Taxation & Anti-Narcotics Branch) vide letter No. 34-Reg/E&T/Bor/1789-91 dated 24th Jun 2019,hasdirected theSeniorExcise&TaxationOfficer for theregistrationandprovision of embossed plates and booklets to 1407 un-registered vehicles of Police Department. As and when the registration process is completed, the same will be furnished to PAC.

PAC deferred the Para with directive that the matter of registration of vehicles be resolved within a month under intimation to PAC for further consideration.

EXCISE & TAXATION DEPARTMENT(Meeting held on 26th September, 2019)

INTRODUCTIONThe main function of Excise and Taxation Department is to enhance Government’s Revenue by shifting to new tax culture, minimizing discretionary powers, ensuring accuracy in tax collection, mobilizing existing resources, exploring new tax potentials, expanding tax base, developing & adopting systems and procedures that provide maximum facilities to the taxpayers.

PAC OBSERVATIONSWhile scrutinizing the Audit Paras of Excise & Taxation Department, the most significantissuethatcomeacrossthePACwastherecoveryofRs.38millionfromCantonmentBoardQuettaonaccountof15%shareofthenetproceedsofHouse/Property Tax assessed and collected on the annual value of Land and Buildings in the Cantonment area by the Cantonment Board Quetta. The nonpayment of aforesaid tax to the Government of Balochistan is manifest violation of Clause 3 (2) of Presidential Order No. 13 of 1979.

Furthermore, other observations noted in the department were non-achievement of revenue targets set by the Finance Department, non-recovery of advance paid to the contractor/consultant for Computerizing the Tax Collection System of the department, and non-reconciliation of revenue statement between the office ofDirectorGeneralExcise&TaxationBalochistan(North)andofficeoftheAccountantGeneral Balochistan.

Recoverables 80%

EXCISE & TAXATION DEPARTMENT158

4. Paras Settled 01

Total 05

Para pertaining to non-achievement of Revenue Target was settled by the Committee with directive that, in future, the Finance Department shall set rationalized revenue targets in collaboration with the Excise & Taxation Department. Whereas, rest of the Paras were deferred and settled subject to conditions of recovery of outstanding amount of Property Tax.

Furthermore, the Para pertaining to the recovery of advance payment to the contractor/consultant for computerizing the Tax Collection System was referred to the Special Departments Accounts Committee (SDAC). The SDAC in its meeting dated 9th December 2019 recommended the PAC to hear the departmental stance and request the Chief Minister Inspection Team (CMIT) to conclude the inquiry within 60 days, as the matter had already been referred to CMIT for investigation.

The compliance on all deferred and settled subject to condition(s) Paras will be reviewed in ensuing meeting of PAC.

60% 20%

Paras Deferred

Rs. in Million

# Audit ObservationS No. of Paras

Recovery Effected

Total 05 508.47 2.34

Recovery of Rs.2.34 million on account of Property Tax (other than from Cantonment Board) has been effect and rest of the Paras pertaining to recoverables were deferred and settled subject to condition that recovery of remaining amount on which compliance will be obtained in next PAC meeting of the department.

The Accountant General Balochistan briefed that huge savings of Rs. 68.16 million reflects improperbudgetplanningand inaccurate forecastingofexpenditure.Hefurther added that, the budget shall be prepared on the basis of working strength of employees rather than on the basis of sanctioned strength, unless, the chances offillingofthevacantpostsaremorelikely.

494.34

Recoverables

Rs. in Million

Supp. Grant Surren-der Final

GrantExpendi-

tureExcess/

(Savings) %

Non-Development (Excise Grant No.BC2002)

733.58 - (74.12) 659.46 591.30 (68.16) 10.34

Total 733.58 - (74.12) 659.46 591.30 (68.16) 10.34

Secretary/PAO Excise & Taxation department replied that all of the savings during the F.Y 2016-17 under Non-Development grant pertains to Pay & Allowances, because, during the period under audit many posts were lying vacant.

PAC DIRECTIVE(S)

Para settled with directive to ensure avoidance of such practice in future and surrender the savings to Finance Department in timely basis.

PARA # 12.2.1: LESS REALIZATION OF REVENUE TARGETS – RS. 404.050 MILLION.

Audit observed that the following offices of Excise and Taxation Department,Balochistan, did not achieve target for revenue generation on account of collection of Property Tax, Motor vehicle Tax (Token & Registration), Narcotics (Whole sale & Retailer),Cinema/EntertainmentTaxetc.ofRs.404.050million,during2014-16,in disregard of rule 3, GFR Vol-I:-

Rs. in Million

S. No. Name of Formation Year Revenue Target

Target Realized Difference

1. Director General North 2014-15 1,035.543 969.313 66.233

2. ETO-III 2014-15 146.648 142.279 4.369

3. ETO-II 2015-16 25.505 15.396 10.109

4. Director General North 2015-16 1,012.501 776.018 236.483

5. Director General South 2015-16 509.758 427.362 82.396

6. ETO-IV 2015-16 14.460 10.000 4.460

Total 2,744.415 2,340.368 404.050

Department explained that revenue targets are set by the Finance Department without consultation of Excise & Taxation department resulting unattainable and irrational targets. The Secretary, Excise & Taxation department, urged that rationalized targets may be set by the Finance Department keeping in view of the capacity of the Department.

PAC DIRECTIVE(S)

The Para was settled with directives to the Finance Department that, in future, rationalized revenue targets shall be set in collaboration/consultation with Excise and Taxation Department under intimation to PAC.

PARA # 12.2.2: NON-REALIZATION OF PROPERTY TAX ROM CANTONMENT BOARD QUETTA – RS. 38.002 MILLION.

AuditobservedthatExciseandTaxationOfficer-IIrequestedtheCantonmentBoardQuettainDecember2010,forremissionofpropertytax,15%shareofGovernmentofBalochistanstartingfrom2002-03till2014-15,whichcomestoRs.38.002million,but no such payment was made to the government of Balochistan in violation of clause 3 (2) of President Order No. 13 of 1979.

Department explained that the Cantonment Board Quetta has refused to pay the amount of Rs.38.002 million. However, the matter has been taken up with Chief ExecutiveOfficer(CEO)CantonmentBoardandissuewillbesolvedsoon.

PAC DIRECTIVE(S)

Para was deferred with directive that matter be taken up with the Chief Executive Officer,CantonmentBoardQuettaandtheoutcomethereofbesubmittedto thePAC within 02 months for further consideration.

PARA # 12.2.3: NON-REALIZATION OF PROPERTY TAX – RS. 37.237 MILLION.

AuditpointedoutthatthefollowingofficesoftheExciseandTaxationDepartment,Balochistan,failedtorealizepropertytaxofRs.37.239million,withinthespecifiedtimefromthepropertyownersofassessedratingareafrom2013-14to2015-16,inviolationofsection11oftheUrbanImmoveablePropertyTaxAct,1958:-

Rs. in Million

S. No. Name of Formation Year No. of Cases Amount

1. ETO-II 2014-15 QMC 31.311

2. ETO- Loralai 2015-16 23 4.093

3. ETO-II 2014-15 78 1.154

4. ETO-VII 2015-16 29 0.679

Total 130 37.237

Department explained that the following recoveries have been affected from defaulters and remaining is under process. The matter regarding recovery of Rs. 31.311 million and the payment of property tax relating to ETO-II for the period from1994to2015hasbeentakenupwithMunicipalCorporationQuettaHowever,M.C.Q is not cooperating:-

Rs. in Million

# Year ETO OfficeTotal

CasesCases Settled

Cases Pending

Amount Recoverable

Amount Recovered

Balance

1. 1994-15 ETO-II - - - 31.311 - 31.311

2. 2015-16 ETO Loralai 23 10 13 4.094 0.921 3.173

3. 2014-15 ETO II 78 65 13 1.154 0.995 0.159

4. 2015-16 ETO VII 29 26 03 0.589 0.428 0.161

Total 130 101 29 37.148 2.344 34.804

PAC DIRECTIVE(S)

Para was settled subject to recovery of the remaining amount i.e. Rs. 34.804 million by 30th June, 2020 under intimation to D.G Audit and PAC.

PARA # 12.2.4: RECOVERY OF ADVANCE PAYMENT OF COMPUTERIZED TAX COLLECTION SYSTEM – RS. 15.084 MILLION.

Audit pointed out that the Director General Excise & Taxation Department, Quetta paidRs.15.084million,during2015-16, toM/sDyconsol (Pvt.)Ltd.Quettaonaccount of providing Computerized Tax Collection System, but the contractor did not supply the required equipment in disregard of Section-F of Project Schedule at S. No F-1.

Department explained that procurement of Computer hardware was not made, however,thepaymentamountingtoRs.15.084millionwasmadetoM.SDyconsol(Pvt.) Ltd. Quetta for conducting research and feasibility study of Computerizing the Tax Collection System, as per agreement signed with them.

PAC DIRECTIVE(S)

Para was deferred with directives that Special DAC meeting, including representative of PAC i.e. the Deputy Secretary (PAC), to be held on the matter and report thereof be submitted within 02 months for further consideration of PAC.

PARA # 12.2.5: OVERSTATEMENT DUE TO REPORTING OF WRONG FIGURES – RS. 14.134 MILLION.

AuditobservedthatintheofficeofDirectorGeneralExciseandTaxationBalochistan(North) a difference of an amount of Rs.1 4.133 million, was noticed during 2014-15.Thisdifferencewasnotverifiablebecausenorecordofrevenuereceipts,exceptannual revenue statement, was available with Director General Excise, Balochistan, Quetta.

Rs. in Million

Head of account SAP R/3 DG Excise Difference

B01301-Ordinary Collection 56.733 60.776 -4.043

B01601-Ordinary Collection 1.576 1.881 -0.305

B026-Provincial Excise 374.377 381.265 -6.889

B02626-27-67-68 – Trade Tax 1.502 0.547 0.955

B028-Motor Vehicle Tax 518.801 522.654 -3.852

B03023-Welfare Cases 0.052 0.052 -

B03056-Hotels Tax 2.138 2.138 -

Total 955.179 969.313 -14.134

Department explained that maximum efforts have been taken to streamline the reconciliation mechanism between Excise & Taxation department and the A.G Balochistan. For the purpose, A.G Balochistan is requested for support and depute a focal person to address the reconciliation issues on monthly basis with Excise department.

PAC DIRECTIVE(S)

ParawasdeferredwithdirectivethatthefiguresbefirstreconciledatDistrictlevelthen with A.G Balochistan within 02 months under intimation to PAC for further consideration.

FISHERIES DEPARTMENT(Meeting held on 27th September, 2019)

INTRODUCTION

The basic function of Fisheries Department is to plan and develop Balochistan fisheries sector, bothmarine and inland, onmodern lines as per internationalstandards, and ensure availability of fresh and hygienic seafood to the masses.

PAC OBSERVATIONS

While examining the Audit Report 2017-18, it was observed that the biggest chunk of the observations, as depicted by the following graph, in Fisheries Department was on account of irregular expenditure i.e. occurrence of expenditure out of the public money without adhering to the prevailing rules, regulations, policies and proceduresnotifiedbytheGovernmentfromtimetotimewhichreflectirresponsibilityof management and ineffective internal control system in department. Beside Irregular Expenditure, instances of non-recovery of Income Tax, Penalties and other Government Receipts were also pointed out.

Themost significant issue in thedepartmentwassellingand leasingoutof the10750acresofLandoriginallydeclared forconstructionofHarbor,StaffColonyfor Harbor’s employees and Fish Processing Zone at Shoreline/Coastal belt around Pasni Town. Detailed scrutiny revealed that the management of Pasni Fisheries Harbor Authority (PFHA) leased out 113 plots and 131 shops on the declared land to various tenants/leases on rent basis. The Committee deferred the issue with direction to the Chief Secretary Balochistan to conduct inquiry into the matter and report to the PAC within 03 months.

4. Paras Settled 01

Total 10

40% Recoverables 20%

Evasion of Taxes & Du�es 20%

Paras Deferred

FISHERIES DEPARTMENT168

As the recovery of Income Tax from the salaries of employees has been effected and deposited into Government Treasury, therefore, Audit Para pertaining to Evasion of Taxes & Duties (to the extent of recovery from employees) has been settled by the Committee. However, rest of the 90% Paras were deferred and settled subject to conditionsofrecoveryofremainingamount,verificationofrecord,regularizationofexpenditure and initiation of inquiry into the matter of leasing/selling out of Harbor Land.

Rs. in Million

Recovery Effected

Total 10 140.09 7.71

Recovery of Rs.7.71 million has been effected. Whereas, the recovery on remaining Recoverables and Evasion of Taxes & Duties will be checked in the next PAC meeting of the department along-with checking compliance on irregular and unauthorized expenditure.

Recoverables

Rs. in Million

Accountant General Balochistan briefed the subject Appropriation Accounts Development and Non-Development funds amounting to Rs.1,197.78 million were allocated to the Department during 2016-17. Against the said allocation, an expenditure of Rs.834.76 million was incurred, as summarized below–

Rs. in Million

Supp. Grant

Surren-der

Final Grant

Expendi-ture

Excess/ (Savings)

Non-Development

(Fisheries Grant

No.BC21030)

839.71 - (48.18) 791.52 727.03 (64.50) 8.15

Development

(Function No.042501)440.79 - (34.53) 406.26 107.73 (298.53) 73.48

Total 1,280.50 - (82.71) 1197.78 834.76 (363.03) 30.30

Department explained that savings during the F.Y 2016-17 were surrendered to the FinanceDepartmentwithinthestipulatedperiod.ThesavingsofRs.64.50millionunder the Non-Development head pertains to Pay & Allowances and savings of Rs. 298.53millionundertheDevelopmentheadwereduetolatereleaseoffundsbytheFinance Department and non-availability of Land.

PAC DIRECTIVE(S)

Discussion on the Appropriation Accounts was deferred with directives that the departmentshall reconcile thefigureswithA.GBalochistanunder intimation toPAC.

PARA # 13.2.1: UNAUTHORIZED LEASE OF LAND FOR VIP HOTEL IN HARBOR AREA – RS. 1.764 MILLION.

Audit pointed out that the Managing Director, Pasni Fisheries Harbor Authority, Pasniallottedlandmeasuring2520squareyardsonleasebasisforperiodof33years for construction of VIP hotel in the premises of harbor area on very low cost amounting to Rs. 1.764 million to M/s Mir Muhammad Ibrahim in violation of Section 10(2) (d) of the Pasni Fisheries Harbor Authority, Ordinance 1983.

Department explained that inquiry under the Chairmanship of Chief Minster Inspection Team (CMIT) to probe into the matter. The inquiry report is available for Audit and further consideration of the Committee.

PAC DIRECTIVE(S)

ParawassettledsubjecttoverificationofInquiryReportofCMITbyAuditunderintimation to the PAC.

PARA # 13.2.2: UNAUTHORIZED DRAWL OF PUBLIC MONEY – RS. 1.00 MILLION.

Audit pointed out that the Managing Director, Pasni Fisheries Harbor Authority, Pasni, drew an amount of Rs. 1.0 million vide Cheque no. 15055169 dated14.03.2016 without any immediate requirement. No adjustment account was available in the record to authenticate the drawl in violation of Para 290 of FTR.

Audit was of the view that drawl of funds without supporting paid vouchers may lead to misappropriation of public money.

Department explained that the drawl of money was made for day to day expenses of the project which will be reimbursed from the Project Management Unit (PMU) budget as and when released. Moreover, matter has been included in the Agenda of the Board of Directors meeting of PFHA for ex-post-facto approval. Forum was further apprised that for the smooth running of the Rehabilitation of Pasni Fish Authority (RPFA)project the charge of the Project Director RPFA was given to the Managing Director Pasni Fisheries Harbor Authority (PFHA) on the advice of the then Chief Minister Balochistan.

PAC DIRECTIVE(S)

Parawassettledsubjecttoverificationofcompleterecordrelatingtothedrawlandusage of public money by D.G Audit under intimation to PAC.

PARA # 13.2.3: NON-REGISTRATION OF FISH AUCTIONEERS / MOLE HOLDERS AND FISHING VESSELS / BOATS LICENSES – RS. 83.164 MILLION.

Audit pointed out that the Managing Director, Pasni Fisheries Harbor Authority failed to collect auction fees, loading / un-loading charges and registration and annualrenewallicensingfeesofVessels/Boatsduring2014-15,amountingtoRs.83.164 million.

Rs. in Million

S. No. Description Amount

1.Non-Collection of Auction Fees 3% of total quantity of Fish landing at Pasni, 28294 Tons of total value Rs. 2,358.646 million

70.759

2.Non-Collection of Loading / Un-Loading charges on cargo and fishing vessels, total quantity of Fish landing at Pasni, 28294x2=56588 Tons

11.318

3. Non-Registration and Annual Renewal Licensing Fee of Vessels / Boats 1.088

Total 83.165

Departmentexplainedthatduetouncertainlaw&ordersituation,financialcrunch,and some internal issues the Harbor Channel was closed in 2010 and the mole/auction system was suspended, therefore, the Para may please be settled.

PAC DIRECTIVE(S)

ParawassettledsubjecttoverificationofclosurerecordofHarborChannelbyD.GAudit Balochistan under intimation to PAC.

PARA # 13.2.4: NON-RECOVERY OF RECEIPTS – RS. 24.528 MILLION.

Audit pointed out that in violation of Section 24 of Pasni Fisheries Harbor Authority, Ordinance 1983, the Managing Director, Pasni Fisheries Harbor Authority, Pasni hasnot recoveredanamountofRs.24.528millionoutstandingagainstvarioustenants / lease son account of auction fees, ground rent, rental charges, sale of land and water charges since long, as detailed below–

RRs. in Million

S. No. Description Amount

1. Auction Fees 16.347

2. Ground Rent 6.528

3. Rental charges 0.660

4. Sale of Land 0.929

5. Water charges 0.064

Total 24.528

Department apprised the forum that notices have been issued to the defaulters with awarning of legal proceedings.Moreover, an amount of Rs.4.5506million

has been recovered from the individuals/parties. The Managing Director, Pasni Fisheries Harbor Authority (PFHA), requested to waive-off the recovery on account ofGroundRentRs.6.528millionandSaleofLandRs.0.929million,andclaimedthat unless the Ground and Land are mutated in the name of PFHA, recovery in this regard can’t be effected.

PAC DIRECTIVE(S)

Para was deferred with directive that the recovery of remaining amount be effected from defaulters within 06 months under intimation to audit and PAC.

PARA # 13.2.5: NON-IMPOSITION OF PENALTY – RS. 20.599 MILLION.

Audit pointed out that the Director General Fisheries Balochistan Quetta procured equipment of Rs. 205.999million, during 2014-15, but the contractor failed tosupply the equipment within the stipulated time but even after expiry of a long period, penalty for late delivery of equipment has not been imposed, due to which GovernmentsustainedalossofRs.20.599million.

Rs. in Million

S. No.

Name of Firm Date of Bill Date of StartDate of

CompletionDate of Delivery

Amount of Bill

10% Penalty

1. M/s SK&B 17.06.2015 22.04.2015 21.06.15 17.02.16 52.000 5.200

2. M/s Adams 17.06.2015 22.04.2015 21.06.15 17.02.16 3.000 0.300

3. M/s Naeem & Co. 17.06.2015 22.04.2015 21.06.15 17.02.16 150.999 15.099

Total 205.999 20.599

Department explained that the goods containing under the scheme had to be imported by the contractor through various import and export channels which involve lengthy procedures, therefore, delay of few months in supply of goods was occurred. However, on the request of the contractor, relaxation in delivery time was accorded under the rules confer to the authority.

PAC DIRECTIVE(S)

Para was settled subject to recovery of late delivery charges (penalty) from contractor within 02 months under intimation to D.G Audit and PAC.

PARA # 13.2.6: LESS DEDUCTION OF INCOME TAX – RS. 2.227 MILLION.

AuditobservedthatSection–153(1)(a)ofIncomeTaxOrdinance2001,theDirectorGeneralFisheriesBalochistanQuetta,procuredequipmentofRs.209.415million,during2014-15,butincometaxamountingtoRs.2.227million,wasdeductedlessthan the prescribe rate from the bills of contractors, as detailed below–

Rs. in Million

S. No. Name of Firm Date Amount I. Tax

Deducted

I. Tax to be Deducted

4.5%Difference

1. M/s SK&B 17.06.15 51.999 1.777 2.339 0.562

2. M/s Adams 17.06.15 3.000 0.102 0.135 0.032

3. M/s Naeem& Co. 17.06.15 150.999 5.162 6.794 1.632

Total 205.999 7.042 9.269 2.227

Department explained that an amount of Rs. 1.60 million has been recovered on account of income tax.

PAC DIRECTIVE(S)

ParawassettledsubjecttoverificationofrecoverychallanbyD.GAuditandwithdirective to recover the remaining amount under intimation to PAC.

PARA # 13.2.7: RECOVERY DUE TO NON-DEDUCTION OF INCOME TAX FROM SALARIES – RS. 2.012 MILLION.

Audit pointed out that the Managing Director, Pasni Fisheries Harbor Authority, Pasni,paidanamountofRs.46.669milliononaccountofSalariestotheofficers/staff, during 2014-16, but it was noticed that Income Tax amounting to Rs. 2.012 million was not deducted at source in violation of above Section–149 of Income Tax Ordinance 2001.

DepartmentapprisedthatincometaxamountingtoRs.3.155milliononaccountofwithholding tax from the salaries of employees has been deducted and deposited in relevant head through NBP Pasni Branch.

PAC DIRECTIVE(S)

As the recovery has been effected from the employees and deposited into Government treasury, therefore, the Committee settled the Para.

PARA # 13.2.8: ILLEGAL / UNAUTHORIZED SETTLEMENT OF PFHA NOTIFIED BY BOARD OF REVENUE.

Audit pointed out that During the audit of the Managing Director, Pasni Fisheries Harbor Authority for the year 2015-16, it was noticed that the Authority wasestablished under cover of PFHA Ordinance 1983 with major assets including declared land of 25 KMs along the shore line/coastal belt around Pasni Towncoveringareaof10750acreswasdeclaredforconstructionofHarbor.Scrutinyofrecord revealed that the management of PFHA leased out 113 plots and 131 shops on the declared land of the authority to various tenants/leases on rent basis.

Moreover, Board of Revenue has unauthorizdely settled all the declared land of PFHA including Fish Landing Jetty and sold out major portions of the land included inthepremisesoftheHarbor’sboundarywall,Harbor’sofficial/staffcolonyareaand Fish Processing Zone to the Tenants/Leasees and private individuals with the connivance of the management of PFHA.

Department explained that until the Land is mutated in the name of Pasni Fisheries Harbor Authority (PFHA), neither construction of Harbor can be initiated nor revenue can be generated. PFHA Land was registered in the name of Deputy Commissioner Gwadar as well as other private parties during settlement process in 2010. The matter has been taken-up with the Chief Secretary Balochistan and others for restoration of the PFHA Land in the name of PFHA. The Deputy Commissioner Gwadar has also been asked to properly earmark the subject Land.

PAC DIRECTIVE(S)

Para was deferred with directive that the Chief Secretary Balochistan is to conduct inquiry into the matter, under his chairmanship, and report to the PAC within 03 months.

PARA # 13.2.9: ILLEGAL RECRUITMENT WITHOUT COMPETITIVE PROCESS.

Audit observed that the Managing Director, Pasni Fisheries Harbor Authority Pasni, made recruitments in the Authority without observing the competitive process of recruitment as laid down in the authority’s rules and regulations (Part-1 of Pasni FisheriesHarborAuthority’sServiceRegulations,2003),during2014-15.

Department admitted the violation of recruitment rules and replied that the appointments were made in emergency (ad-hoc basis) to meet the shortage of staff in Finance Section of the Pasni Fisheries Harbor Authority. However, the matter willalsobeplacedbeforetheBoardofDirectorsforapproval/finaldecisioninnextmeeting of board.

PAC DIRECTIVE(S)

Para was settled subject to regularization of the matter in the meeting of Board of Directors of the authority under intimation to PAC.

PARA # 13.2.10: IRREGULAR EXPENDITURE ON ACCOUNT OF PROCUREMENT AND CIVIL WORKS – RS. 4.707 MILLION.

Audit observed that the Managing Director, Pasni Fisheries Harbor Authority, Pasni, incurred an expenditure of Rs. 4.707 million during 2014-16 on purchase of furniture, computers, uniforms and civil works without calling open tenders in violationofRule15(1)ofBPPR2014andtheFinanceDepartment’sOrderNo.SO(COD)/ PIFRA/1-47/2011/1117-1302 dated September, 2011.

Department admitted violation of BPPRA Rules 2014 and explained that all provision of the procurement rules will be strictly followed, in future. Moreover, the matter will also be placed before the Board of Directors for ex-post-facto approval in its meeting.

PAC DIRECTIVE(S)

Para was settled subject to regularization of expenditure by the Board of Directors (Competent authority) in its next meeting under intimation to PAC.

LIVESTOCK AND DAIRY DEVELOPMENT DEPARTMENT

(Meetings held on 9th August & 13th December, 2019)

INTRODUCTION

Livestock is considered one of the most important sectors in Balochistan. The majority of rural population is engaged in rising of livestock. Basic policy of the Livestock and Dairy Development department is to protect the animals from various diseases. For this purpose, veterinary hospitals were established all over the Province for providing medicine to breeders at their doorstep on subsidized rates. To attract the people toward this sector, the Government established Dairy and Poultry Farms in various districts of the Province. For introduction of new breeds, the Government also arranged supplies of animals to the breeders on subsidized rates.

PAC OBSERVATIONS

While examining the Audit Report 2017-18 it was observed that, the Deputy Director Livestock Musa Khail and Deputy Director Livestock Barkhan paid Salaries to their employees in cash instead of direct credit transfer to their respective Bank Accounts resulting in increased risk of theft, fraud and most importantly the source forcollusionbetweentheemployeesandofficersformutualinterestofrelaxationfrom duties.

Beside the aforesaid issue violation of Balochistan Public Procurement Rules 2014, General Financial Rules and Standing Orders of Finance Department, Government of Balochistan was also noted.

4. Paras Settled 01

Total 05

Irregular

Expenditure 40%

Recoverables 20%

Paras Deferred

Paras Se�led

LIVESTOCK AND DAIRY DEVELOPMENT DEPARTMENT180

One of the Para was settled on the recommendations of Fact Finding Committee, constitutedonthedirectionsofPACandheadedbythePrincipalAccountingOfficer.However, rest of the Audit Paras were deferred and settled subject to conditions as detailed in ensuing pages.

Rs. in Million

Recovery Effected

Total 05 101.82 1.03

Recovery of Rs.1.03 million has been effected by the department against total recoverables.

Recoverables

Loss Sustained by the Govt.

Rs. in Million

Additional Accountant General explained that Development and Non-Development fundsamountingtoRs.2,518.00millionwereallocatedtotheDepartmentduringF.Y. 2016-17. Against the said allocation, an expenditure of Rs. 2,483.30 million was incurred. Saving of Rs. 34.70 million on development and non-development sideindicatesimproperbudgetingandfinancialmismanagement,assummarizedbelow–

Rs. in Million

Supp. Grant

Surren-der

Final Grant

Expendi-ture

Excess/ (Savings) %

Non- Development - - - 2,301.00 2,239.20 (61.60) 2.68

Development - - - 217.00 244.10 27.10 12.49

Total - - - 2,518.00 2,483.30 (34.70) 1.38

Secretary/PAO contended the statement of Accountant General and explained that thereisalittlevariationinfigures.FinalgrantinrespectofNon-DevelopmentandDevelopment expenditure needs to be reconciled with AG. The saving amounting to Rs.34.70 million is overall 01 percent which is manageable and can be settled by reconciliation with Accountant General. The department requested to regularize the appropriation Account under reference.

PAC DIRECTIVE(S) (9TH AUGUST, 2019):

The Committee regularized the saving of the grant with the directives to reconcile the appropriation accounts with the Accountant General Balochistan. The PAO was alsodirectedtomonitorfinancialcontrolonthedepartmentalbudgeting,infuture.

PARA # 14.2.1: DOUBTFUL PURCHASES OF MACHINERY AND EQUIPMENT AT HIGHER RATES RS. 0.915 MILLION.

Audit pointed out that the Directorate General, Livestock and Dairy Development Department,QuettaincurredanexpenditureofRs.1.574milliononpurchaseofmachineryandequipmentduringtheyear2014-15.Onscrutinyoftherecorditwas observed that the procurement was made by open tender but at higher rates than the prevailing market prices.

Department explained that an inquiry committee was constituted by the then Secretary, Livestock department to carry out investigation. However, owing to transferoftheinquiryofficerinquirycouldnotbecompletedduetowhichmatteris still pending. Now, three members committee has been constituted to submit its findingswithinonemonth.Nonetheless,thePAOadmittednegligenceandlapseonpart of the department and requested to defer the Para till next meeting.

The Committee deferred the Para with directives that departmental inquiry committeemayprobeintothematter,fixresponsibilityagainstthepersonsatfaultwithin60daysandsubmititsreport/findingstothePACforfurtherconsideration.

Department explained that on the directives of PAC, a Departmental Committee was constituted which examined all documents of tender thoroughly and found that the machineryandequipmentpurchasedinFebruary2015accordingtospecification.

PAOfurthersharedthatthefollowing3officerswereintheCommittee:-

1. Dr. Tariq Masood, DG2. Dr. Baig Muhammad, Deputy Director (HQ)3. Dr. Nisar Durrani.

Allabovenamedofficershavebeenretiredfromservicetherefore,theParamaybedroppedwithoutmakinganyrecoveryofR.66215.TheprocuredFax-machineisstill available in working condition.

PAC settled the Para on the following grounds:-

1. Recommendations of the Fact Finding Departmental Committee constituted on the direction of PAC;

2. Properjustification&endorsementofPAO/Secretary;and

3. AgreeingofAuditwiththefindings/recommendationsofthesaidCommittee/PAO, Livestock.

PARA # 14.2.2: IRREGULAR DRAWL OF PAY AND ALLOWANCES - RS. 68.268 MILLION.

Audit observed that the following offices of Livestock and Dairy DevelopmentDepartment drew an amount of Rs. 68.268 million on account of staff salaries throughDDOinsteadofpayee’sbankaccountsduringthefinancialyear2014-15.Furthermore, payee’s acknowledgment receipts were not produced to audit:-

Rs. in Million

S. No. Name of Office Description Year Amount

1.Deputy Director, Live Stock Musa Khail.

Irregular Drawl of Pay 2014-15 34.840

2.Deputy Director, Live Stock Barkhan.

Irregular Drawl of Pay 2014-15 33.428

Total 68.268

In response thereto, the Secretary Livestock explained that following the directives oftheDAC,aseniorofficerwasappointedasinquiryofficertoprobeintothematter.

Though inquiry was not completed yet on the basis of particulars collected by the inquiryofficer,nointentionalirregularitywasfoundonpartoftheconcernedDDOsofMusakhailandBarkhan.However,thePAOassuredtosubmitfindingsofthreemembers departmental inquiry Committee to the PAC within a one month time and requested to defer the Para.

The Committee deferred the Para with direction that departmental inquiry committee mayprobeintothematter,fixresponsibilityagainstthepersonsatfaultwithin60daysandsubmititsreport/findingstothePACforfurtherconsideration.

Department explained that following the directives of PAC, a Departmental Committee was constituted wherein the office record regarding the opening ofBank accounts for employees of Livestock Department district Barkhan was found satisfactory. However, The Inquiry Committee interrogated the Deputy Director of Musakhail.TheofficerfailedtosatisfytheCommitteeandwasunabletoproduceauthentic record. The Committee recommended that an inquiry under the BEEDA Act 2011 be initiated against the Deputy Director, Musakhail.

PACexaminedthoroughlythefindings/recommendationsoftheDepartmentalFactFinding Committee, the endorsement/justifications of the PAO/Secretary & theagreeingoftheAuditwiththefindings/recommendations/justificationsofthesaidCommittee/PAO, the PAC thus, passed the following Directives:-

1. PAC settled the Para pertaining to the Deputy Director, Barkhan.

2. PAC deferred the Para pertaining to the Deputy Director, Musakhail with directive that the PAO/Secretary shall initiate a proper inquiry against the officerconcernedundertheBEEDAAct,2011andcompliancereportthereofbe sent to the PAC within 2 months for further consideration.

PARA # 14.2.3: IRREGULAR EXPENDITURE DUE TO NON-CALLING OF OPEN TENDERS – RS. 25.968 MILLION.

Audit observed that in the followingoffices of LivestockandDairyDevelopmentDepartment, the following expenditure was incurred on the purchase of seed, fertilizer,feedandmiscellaneousitemsvaluingRs.25.968million,during2014-15and2015-16,withoutinvitingopentendersinleadingnewspapers:-

Rs. in Million

S.No. Name of Office Description Year Amount

1.Superintendent, Bhagnari Cattle Farm, Usta Muhammad

Purchase of seed and fertilizer

2014-15 2.382

2.Superintendent, Bhagnari Cattle Farm, Usta Muhammad

Purchase of feed and seed

2015-16 8.710

3. Deputy Director, Live Stock Sibi.Purchase of Miscellaneous Items

2015-16 5.700

4. Superintendent, Dairy Farm Quetta Purchase of feed 2015-16 2.940

5.Superintendent, Karakul Sheep Farm Maslakh

Purchase of feed2014-15 and

2015-162.989

6.Superintendent, Government Dairy Farm Kohlu

Purchase of feed 2014-15 1.890

7. Deputy Director, Livestock Loralai Purchase of Medicine 2015-16 0.433

8.Deputy Director, Livestock Mastung.

Purchase of Medicine 2014-15 0.924

Total 25.968

Department explained that although audit recommended regularization of expenditure by the Finance Department, yet it needs thorough investigation due to unavoidablereasons.Inthisregard,thedepartmentalinquiryCommitteefindingshall be submitted to the PAC within a one-month time and requested to defer the Para.

REPLY OF THE DEPARTMENT ON 13TH DECEMBER, 2019:Department explained that following the directives of PAC, a Departmental Committee was constituted to investigate into the matter. Recommendations of the committeeweresharedindetailwiththeforum.Keepinginviewofthejustificationthe department requested to settle the Para.

ThePACexaminedthoroughlythefindings/recommendationsoftheDepartmentalFact Finding Committee, the endorsement/recommendations of PAO/Secretary & theagreeingofAuditwiththefindings/recommendationsofthesaidCommittee/PAO, the PAC thus, passed the following Directives:-

1. PAC settled the Para pertaining to the Deputy Director Livestock Sibi, the Superintendent Dairy Farm Kohlu & the Deputy Director, Livestock Mastung.

2. PAC settled the Para pertaining to the Superintendent Bhagnari Cattle Farm Usta Muhammad & the Superintendent Dairy Farm Quetta subject to regularization of the expenditure and report thereof be sent to PAC for record/authentication.

3. PAC deferred the Para pertaining to the Superintendent, Karakul Sheep Farm Maslakh with directive that the PAO shall initiate a formal Inquiry under BEEDA Act,2011againsttheofficerinvolvedandthereportthereofbesent,within2months, to the PAC for further consideration.

4. PAC settled the Para pertaining to the Deputy Director, Livestock Loralai subject to effecting of recovery and the record thereof be sent to PAC for record/authentication.

PARA # 14.2.4: LESS REALIZATION OF REVENUE - RS. 5.404 MILLION.

AuditobservedthatforthefollowingofficesoftheLivestockandDairyDevelopmentDepartment,asumofRs.13.025millionwasfixedasrevenuetargetbyFinanceDepartmentfortheyear2015-16againstwhichtheofficerealizedasumofRs.7.621millionwhichresultedinlessrealizationofRs.5.404million.

Rs. in Million

Name of Office Year Targeted Income

Income Realized Difference

Superintendent Dairy Farm Quetta 2015-16 8.500 5.895 2.605

Superintendent Beef Production Research Center Sibi

2015-16 4.525 1.726 2.799

Total 13.025 7.621 5.404

In reply thereto, the PAO explained that in the DAC meeting certain reasons were giventosatisfytheaudit,nonetheless,auditwasnotsatisfiedandinstructedtofurther inquire into the matter. The department requested to defer the Para till finalizationofinquirycommitteebeingconstitutedtoprobeintothematter.

Department explained that under theDepartmental inquiryCommittee findings(constituted on the directive of PAC), the superintendent Farm Quetta may either payrecoveryofRs.1,302,500/-ora formal inquiryunderBEEDAAct,2011beordered against him. So far as Beef Production Research Center in concerned the

deficientamountofRs.1.274MillionmayberecoveredfromSuperintendentBeefProduction Research Centre, Sibi.

ThePACexaminedthoroughlythefindings/recommendationsoftheDepartmentalFact Finding Committee, the endorsement of the PAO/Secretary & the agreeing of theAuditwiththefindings/recommendationsofthesaidCommittee,thePACthus,passed the following Directives:-

1. PAC settled the Para pertaining to the Superintendent Dairy Farm Quetta subject to effecting of recovery amounting toRs. 1302500/- and the recordthereof be sent to PAC for record.

2. PAC settled the Para pertaining to the Superintendent Beef Production Research Center Sibi subject to effecting of recovery of Rs. 241000/- as he hasalreadydepositedRs.1033000/-(depositedChallansverifiedbytheAudit)and the compliance of recovery of Rs. 241000/- be sent to PAC for record/authentication.

PARA # 14.2.5: LOSS DUE TO MORTALITY OF ANIMALS AMOUNTING TO RS. 1.260 MILLION.

Audit pointed out that during audit of Superintendent, Bhagnari Cattle Farm and UstaMuhammadforthefinancialyear2015-16,28cattlevaluingRs.1.260milliondied without apparent reasons. This mortality rate is considered abnormal by the audit. However, no inquiry was conducted by the department to determine the causesandtofixresponsibilitythereof.

Department requested to defer the Para till outcome of the departmental inquiry committee which ascertains the causes of abnormal mortality rate.

Keeping in view of the departmental inquiry Committee findings, the PAOrecommendedthataninquiryunderBEEDAAct,2011beinitiatedagainstofficialsat fault.

The Committee settled the Para subject to conducting of inquiry as recommended by the Fact Finding Committee and the report thereof be sent to PAC for record/authentication.

FOREST AND WILDLIFE DEPARTMENT(Meeting held on 24th October 2019)

INTRODUCTION

The core operational activities of the Forest & Wildlife department are–

1. Forest ecosystem conversation and management, including a forestation and reforestation activities.

2. Rangeland development, management and regulation on sustainable use basis.

3. Wildlife, biodiversity conservation and protected area management and regulation.

4. Watershed conservation and management.

5. Soilconservationanddesertificationcontrol.

6. Extension and promotion of conservation initiatives.

7. Regulation of Forest & Wildlife produce (timber, non-timber forest products & fuel wood).

8. Forest recreational parks, zoological and botanical gardens.

PAC OBSERVATIONS

While examining the Audit Report 2017-18 it was observed that all of the Audit Paras in the Forest & Wildlife Department were pertaining to irregular expenditure due to violation of General Financial Rules, Central Public Works Account Codes, and StandingOrders/NotificationsofFinanceDepartment,GovernmentofBalochistanwhich signify weak internal control system over the expenditure out of the public money.

2. Paras Settled 06

Total 06

Paras Se�led

FOREST AND WILDLIFE DEPARTMENT192

Onthebasisoffollowingjustifications,CommitteesettledalltheParas:-

1. Recovery of Rs.1.431 million on account of stipend and training charges.

2. VerificationofrelevantrecordbyAudit(asdetailedinfollowingpages).

3. Warning to the PAO to avoid splitting up of procurement in future.

Rs. in Million

Recovery Effected

1. Irregular Expenditure 06 19.56 1.43

Total 06 19.56 1.43

Against the total Irregular Expenditure of Rs.19.56 million incurred by thedepartment the recoverable amount of Rs.1.43 has been recovered and record theretoisverifiedbyAudit.

19.56 1.43 Irregular Expenditure

Recovery Effected PAC Observa�on

Rs. in Million

Accountant General Balochistan briefed that Under Non-Development Grant The departmenthasshownsavingsofRs.67.69millionoutofthefinalgrantamountingtoRs.894.35savingsareonly7.57%ofthefinalgrantthatmaybeoccurredinPay& Allowances. The AG recommended for regularization of aforesaid savings. With regard to the Development Grant, the A.G Balochistan explained the Committee thatanamountofRs.252.16millionwasgranted to thedepartmentunder thehead of development budget. An expenditure of Rs. 217.22 million incurred against approved budget and savings of Rs. 34.94 million was shown.

Rs. in Million

Supp. Grant

SurrenderFinal Grant

Expendi-ture

Excess/ (Savings)

Non-Development

(Grant No.BC21029)1,086.25 - (191.90) 894.35 826.66 (67.69) 7.57

Development

(Forestry 042402)31.42 222.71 (1.97) 252.16 217.22 (34.94) 13.86

Total 1,117.68 222.71 (193.87) 1,146.52 1,043.88 (102.64) 8.95

DepartmentapprisedtheCommitteethat20%to25%ofbudgetgrantedundertheDevelopment Head was spent by Communication & Works (C&W) department. PAO explainedthatanexpenditureofRs.35.00million,incurredbyC&Wdepartmenton behalf of Forest & Wildlife department during the F.Y 2016-17 under the head of Development Grant, has not yet been accounted for, therefore, savings of Rs.34.94 million are exhibited by Appropriation Accounts.

PAC DIRECTIVE(S)

Committee regularized the savings shown in Appropriation Accounts with directive that amount of savings shall be reconciled with A.G Balochistan under intimation to PAC.

PARA # 15.2.1: IRREGULAR EXPENDITURE ON STIPEND AND TRAINING CHARGES – RS. 4.607 MILLION.

Audit observed that the Chief Conservator Forest (North), Quetta, paid an amount ofRs.4.607million,during2015-16, toPakistanForest Institute,Peshawaronaccount of stipends and training charges of nine nominated candidates but detailed accounts were not obtained in disregard of Para 10 (i) of GFR Vol-I.

Department explained that Expenditure Statement, in original, obtained from PakistanForestInstitutePeshawarhasbeensubmittedtoauditalongwithverifiedcopies of recovery Challans amounting to Rs.14,31,0000/- (Rs.3,85,000 perstudent).

PAC DIRECTIVE(S)

AstheexpenditurerecordandrecoveryChallanshavebeenverifiedbytheAudit,therefore, Committee settled the Para.

PARA # 15.2.2: IRREGULAR EXPENDITURE ON POL – RS. 4.600 MILLION.

Audit pointed out that the Deputy Conservator Forest, Quetta City incurred an expenditureofRs.4.600million,during,2014-15,onaccountofPOLchargesofdepartmental vehicles out of Development funds in violation of Para 12 of GFR.

Department explained that copy of the PC-I specifying availability of funds for Petrol, OilandLubes(POL)isattachedforverificationofAudit.Moreover,fundamountingtoRs.5.40millionwasallocatedforPOLintheapprovedPC-I.

PAC DIRECTIVE(S)

AstheallocationoffundforPOLhasbeenverifiedbytheD.GAuditBalochistan,hence, Committee settled the Para.

PARA # 15.2.3: IRREGULAR EXPENDITURE DUE TO NON-PREPARATION OF COMPLETION REPORTS – RS. 4.460 MILLION.

Audit pointed out that the Deputy Conservator Forest, Quetta City, incurred an expenditure of Rs. 4.460 million, during 2014-16, for establishment of bird’s aviaries at the following parks, in violation of paragraph 99 of the Central Public Works Department Code.

Rs. in Million

S. No. Scheme Amount

1. Birds Park At Jungle Bagh 1.120

2. Bird Park At Gulistan Town 1.620

3. Bird Park At Pishin 1.720

Total 4.460

Department submitted the Physical VerificationReport,CompletionCertificates,andthirdpartyValidationReportsoftheschemestoAuditforverification.

PAC DIRECTIVE(S)

As the record has been checked and verified by the D.G Audit Balochistan.Committee settled the Para, thus.

PARA # 15.2.4: IRREGULAR EXPENDITURE ON SOWING, PLANTATION AND DEVELOPING OF NURSERY – RS. 3.205 MILLION.

Auditpointedoutthat insomeofficesoftheForestDepartmentBalochistan,anamountofRs.3.205millionwasincurred,duringtheyear2013-16,forsowingandplantation, developing of nursery and road side plantation but codal formalities werenotfulfilledinviolationofCPWDcode56readwithB&RCode2.82Code.

Department apprised that certain documents i.e. MB, Original Estimates, CompletionCertificatesetc.inrespectofthesubjectobservation,areattachedforverificationofAudit.

PAC DIRECTIVE(S)

CommitteesettledthePara,Because,therelevantrecordhasbeenverifiedbytheAudit.

PARA # 15.2.5: IRREGULAR EXPENDITURE ON PURCHASE OF PHYSICAL ASSETS – RS. 1.548 MILLION.

Audit observed that the Deputy Conservator Forest, Ziarat, incurred an expenditure ofRs.1.548milliononpurchaseofphysicalassets(Laptops.Photocopier,MotorCyclesetc.)duringthefinancialyear2015-16,Auditwasoftheopinionthatweakinternal control resulted into irregular expenditure due to following reasons:-

1. Sanction of competent authority was not obtained as the Deputy Conservator was not empowered to incur such huge expenditure; and

2. Relaxation on ban was not obtained from Finance Department.

Department explained that as per Delegation of Powers the Chief Conservator of Forest(North),beingCategory–Iofficer,iscompetentauthoritytograntapprovalfor capital expenditure.

PAC DIRECTIVE(S)

As the expenditure has been regularized by the competent authority and D.G Audit Balochistanissatisfiedwiththereplyofdepartment,therefore,Committeesettledthe Para.

PARA # 15.2.6: IRREGULAR EXPENDITURE ON PURCHASE OF EQUIPMENT AND REPAIR OF VEHICLES – RS. 1.136 MILLION.

Audit observed that the Project Director, Multi-Sect Oral Project for Conservation of Juniper Forest of Balochistan, Quetta incurred an expenditure of Rs. 1.136 million,during2015-16,onpurchaseofvariousequipment’s,forestablishmentofpark at Ziarat and repair of vehicles. The expenditure was held irregular because the amount was split up to avoid obtaining sanction of competent authority and invitation of open tenders, as required under the Para 146 of GFR, Vol-I.

Department explained that in pursuance of the DAC decision, ex-post-facto sanction has been obtained from Secretary Forest & Wildlife Department, Government of Balochistan on November 06, 2017.

PAC DIRECTIVE(S)

CommitteesettledtheParawithdirectivetothePrincipalAccountingOfficer(PAO)to avoid splitting up of procurement in future.

SARDAR BAHADUR KHAN WOMEN’S UNIVERSITY (SBKWU)

(Meeting held on 26th September, 2019)

INTRODUCTION

SardarBahadurKhanWomen’sUniversity,Quetta is a non-profit public sectorhigher education institution established in 2004. The aim of university is to promote and disseminate knowledge in areas of arts, emerging science, and technology besides providing instructions, trainings, research, demonstration and services in such branches of learning as the university may determine.

PAC OBSERVATIONS

In the Audit Report 2017-18 two Audit Paras, pertaining to Non-Production of Record and Overpayment were brought to the Public Accounts Committee. It is the responsibilityofeachPrincipalAccountingOfficer(PAO),toprovideallauditablerecord to the audit team for inspection purpose as directed in Article 170 (2) of the Constitution of Islamic Republic of Pakistan 1973, and make payments out of public fund according to the rules, regulations, policies and procedure made by the Government from time to time.

One of the Audit Paras in University was related with payment to the contractor at Non-Scheduled Rates (NSR) basis without market rate analysis which resulted in overpayment. Audit observations related to NSRs are raised about 07 times in Audit Report 2017-18 in different departments; the obvious reason for which is non revision of Composite Schedule of Rates (CSR) 1998 on annual basis. The Planning and Development Department, Government of Balochistan has updated/revised the Composite Schedule of Rates 1998 on 6th July, 2018 i.e. after 20 years.

To make the public accountability process more effective, it is necessary to update and improve the criteria (CSR, 1998 in this case) against which compliance is checked by the Audit.

3. Paras Settled 01

Total 02

Overpayment 50%

50% 50%

Paras Se�led Subject to Condition(s)

Paras Se�led

SARDAR BAHADUR KHAN WOMEN’S UNIVERSITY (SBKWU)200

Keepinginviewthenon-applicabilityofCompositeScheduleRates1998in2015,the Committee decided to settle the Para pertaining to overpayment. However, the Para related to Non-Production of Record was settled subject to condition that the Vice Chancellor SBK Women’s University shall provide the relevant record to Audit forverification.

Rs. in Million

Recovery Effected

1. Non-Production of Record 01 23.82 -

Total 02 41.53 -

As the Para related to overpayment has been settled by the Committee, therefore, no recovery is effected. However, the compliance on the Para conditionally settled shall be taken in next PAC meeting of the University.

Overpayments

Rs. in Million

Accountant General, Balochistan briefed the Committee that SBK Women’s University is a self-accounting entity and maintains Appropriation Accounts itself, therefore,officeoftheA.GBalochistanhasnoroleinitsAppropriationAccounts.

Rs. in Million

Supp. Grant

Surren-der

Final Grant

Expendi-ture

Excess/ (Savings) %

Received from Government of Balochistan

105.00 - - 105.00 203.28 98.28 93.60

Total 105.00 - - 105.00 203.28 98.28 93.60

PAC DIRECTIVE(S)

Keeping in view of the elucidation of A.G Balochistan and justification of ViceChancellor Sardar Bahadur Khan Women’s University, the Committee regularized the Appropriation Accounts for the F.Y 2016-17.

Audit observed that The Sardar Bahadur Khan Woman University, Quetta, incurred an expenditure of Rs. 1.421 million on account of salaries of evening shift staff and collected revenue receipt amount Rs. 22.402 million as fee and other charges, during2015-16.Themanagementwasrepeatedlyrequestedtoprovidecompleterecord, but failed to do so till completion of audit, as detailed below–

Rs. in Million

S. No. Detail of Expenditure Amount

1. Salary of Evening Shift Staff 1.421

2. Revenue Receipts 22.402

Total 23.823

Vice Chancellor, Sardar Bahadur Khan Women’s University apprised the forum thatall relevantrecord is ready forverificationofaudit.Sheexplicated that theentire evening shift faculty is from amongst permanent employees of the SBKWU, therefore, NOC is not required from them.

PAC DIRECTIVS:

Para was settled subject to provision of the copy of rules that allow the university todeterminetheremunerationofeveningshiftfaculty,toD.GAuditforverificationunder intimation to PAC.

PARA # 16.2.2: OVERPAYMENT DUE TO ALLOWING NON-SCHEDULED RATES – RS. 17.706 MILLION.

Audit observed that Sardar Bahadur Khan Woman University, Quetta, awarded the work “Construction of academic blocks A&B” to the Government contractors a cost ofRs.208.000millionduring2015-16.ThecontractorwasoverpaidanamountofRs. 17.706 million for scheduled items by allowing Non-Scheduled Rates without rate analysis and approval of the competent authority.

Audit was of the view that due to non-adherence to Schedule Rates overpayment was made to the contractor resulting in loss to the government.

Vice Chancellor, SBKWU explained that out of the total items, 16 were paid at theratesbelowthan thoseofspecified inCompositeScheduleRates (CSR).TheSenate in its meeting held on 22nd February, 2016 constituted a Special Steering Committee for resolving the subject matter which, after thorough examination of the case, recommended the Senate for regularization of expenditure. Later on, the Senate in its 11th meeting held on 28th June, 2018 approved the decision of Special Steering Committee.

PAC DIRECTIVE(S)

Keeping inviewof the justificationby theViceChancellorandoutdatednessofCompositeScheduleRates(CSR)1998in2015-16,theCommitteesettledthePara.

SPORTS DEPARTMENT(Meeting held on 27th September, 2019)

INTRODUCTION

The Sports Department takes care of the promotion of sports and games. It also monitors the functioning of the District and Sub-Divisional Sports in Balochistan.

PAC OBSERVATIONS

While examining the Audit Report 2017-18 it was observed that only two Audit Paras pertaining to Doubtful Expenditure and Evasion of Taxes & Duties in the Sports Department were brought to the Public Accounts Committee. Both of the Paraswereresultedfromnon-adherencetotherulesandregulationsspecificallyincluding Income Tax Ordinance 2001, Balochistan Public Procurement Rules 2014, General Financial Rules and Stamp Act 1899.

The essence of establishing effective internal control system in the departments is to ensurethesafeguardingofpublicassets,accuracyoffinancialrecord,adherence/compliance to the Government rules, regulations, policies & procedures and most importantly obtaining value for money against the spending from public accounts. Doubtful Expenditure of Rs.37.44 million incurred on account of procurement of Sports Items without tendering process and non-maintenance of distribution record of items among the participants is a question mark on the effectiveness of internal control system in the department.

Evasion of Taxes & Du�es 50%

Total 02

Both of the Paras were deferred with direction to the PAO to ensure the recovery of IncomeTaxfromthefirmsby30th June 2020 and produce the record of distribution of Sports Items among participants, tender documents and other relevant record to audit for inspection. The compliance on both directives will be taken in next PAC meeting of the Department.

Rs. in Million

# Audit Observations No. of Paras Amount of Observation Recovery Effected

Total 02 45.84 -

Paras Deferred

SPORTS DEPARTMENT206

Norecoveryhasbeenintimatedtillthefinalizationofthisreport.TherecoveryofEvasion of Taxes and duties amounting to Rs.8.40 million and compliance the Doubtful Expenditure will be reviewed in next PAC meeting of the department.

Accountant General Balochistan informed the Committee that Development and Non Development Funds amounting to Rs.2.470.18 million were allocated to theDepartment during 2015-16. Against the said allocation, an expenditure ofRs.956.73millionwasincurred,assummarizedbelow–

Rs. in Million

Supp. Grant

Surren-der

Final Grant

Expendi-ture

Excess/ (Savings) %

Non-Development (Sports Grant No.BC21021)

397.41 262.69 - 662.30 566.90 (95.40) 14.40

Development (Function No.081120)

2,072.77 - - 2,072.77 389.83 (1,683.00) 81.20

Total 2,470.18 262.69 - 2,735.07 956.73 (1,778.40) 65.00

Rs. in Million

Secretary replied that all of the savings during the F.Y 2015-16 under Non-Development grant pertain to Pay & Allowances. Moreover, due to ill preparation, department could not justify the huge savings shown in Appropriation Accounts, therefore, department requested the Committee to either settle the observations or deferthediscussiontillnextmeetingforproperexplanation/justification.

PAC DIRECTIVE(S)

DiscussiononAppropriationAccountswasdeferredwithdirectivethatthefiguresbe reconciled with A.G Balochistan within one month under intimation to PAC for further consideration.

PARA # 17.2.1: DOUBTFUL EXPENDITURE ON PROCUREMENT OF SPORTS ITEMS – RS. 37.437 MILLION.

Audit pointed out that Director Sports Balochistan, Quetta incurred an expenditure ofRs.37.437million,during2015-16,onaccountofprocurementofvarioussportsitems and uniforms and Youm-e-Pakistan Sports Festival 2016, without calling opentendersandfulfillingothercodalformalitiesrequiredunderRule49ofBPPRA2014. The utilization / distribution of the procured items was not available on record. No record of stock entries was maintained by the office in violation ofgovernment rules.

Audit recommended conducting an inquiry with a view to bring out the facts in additiontoprovidingcompleterecordoftheexpendituretoauditforverification.

Department explained that the subject expenditure was incurred on the eve of Pakistan Day (23rd March, 2016) for conducting Balochistan Sports Festival. All necessary documents for S # 01 i.e. tender documents, payees’ acknowledgement

receipts,& other record are ready for verification ofD.GAudit/PACand copiesoftherecordforS#02providedby329BrigadeofficeoftheSouthernCommandQuettaareavailableforverificationofD.GAudit/PAC.

Rs. in Million

# Expenditure Incurred by Expenditure on Account of Amount

1. Sports Department On account of purchase of Sports items. 23.744

2.Office of Southern Command (329 Brigade)

On account of Music Concert. 13.693

Total 37.437

PAC DIRECTIVE(S)

Para was deferred with directive that decision taken at DAC level shall be strictly implemented within one month under intimation to PAC for further consideration.

PARA # 17.2.2: LOSS DUE TO NON / LESS DEDUCTION OF INCOME TAX – RS. 8.404 MILLION.

Audit observed that Director Sport Balochistan Quetta, incurred an expenditure of Rs. 108.014 million, during 2015-16, on account of Cultural Show, ArtistPerformance, Fireworks, Conducting of Mushaira, Musical Night, Catering, Food SupplyandTent-agebutdeductionof5%incometaxwasmadeinsteadof10%incase of S.No.1, whereas no income tax was deducted in all other cases resulting into a loss of Rs. 8.404 million to the government.

Auditrecommendedthattheamountofincometaxberecoveredfromthefirmsanddeposited into government account and evidence be produced to audit.

DepartmentapprisedthattheexpenditurewasincurredbytheofficeofSouthernCommandQuetta for celebrationof IndependenceDay i.e.15thAugust,2015 toconduct Fireworks Show, Cultural Show, Musical Night, Mushaira etc. Therefore, wewillinform329BrigadeofficeoftheSouthernCommandQuettatosubmitthetax withheld.

PAC DIRECTIVE(S)

Para was deferred with directive that recovery of income tax be effected from the concerned contractors/suppliers by 30th June 2020 under intimation to PAC.

The End.

BALOCHISTAN PROVINCIAL ASSEMBLYSECRETARIAT

Report of the

PUBLIC ACCOUNTS COMMITTEE

on Appropriation Accounts of the Government of Balochistan for the Financial Year 2016-17

andReport of the Auditor General of Pakistan

for the Audit Year 2017-18

Provincial Assembly of BalochistanZarghoon Road, Quetta.

Tel:081-9201950-Fax:081-9202575URL: pabalochistan.gov.pk

BALOCHISTAN PROVINCIAL ASSEMBLY SECRETARIAT

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