The Ministry of Finance on Wednesday was oblivious to the whereabouts of more than the National Accountability Bureau (NAB) claimed recovered by the National Accountability Bureau (NAB) in the last 16 years.
In a parliamentary testimony, the Ministry of Finance claimed to only know of the Rs6.458bn out of the total amount recovered by the NAB. The Senate Standing Committee on Finance has decided to seek the aid of the auditor general of Pakistan for a special audit to probe into the matter.
The parliamentary panel also expressed disappointment over the devaluation of the rupee and its distressing impact on inflation.
Additional Finance Secretary Tanveer Butt told the panel that non-tax revenue worth Rs6.458bn had been received over the last 16 years in the form of NAB recoveries.
Butt, while answering questions said that the finance ministry was unaware regarding the whereabouts of the remaining amount. He said, “The money was not being deposited in government accounts. It is not known in which account the NAB had deposited the recovery of Rs821 billion”.
The committee made the decision to write to the Auditor General of Pakistan and NAB (Accounts) director general to appear before it ahead of the next meeting.
The committee chairman Senator Talha Mahmood said the amount recovered by the NAB will also be audited.
According to a paper sent to the Senate committee, NAB said Rs76bn as voluntary refund or plea-bargain, Rs60bn recovery on account of restructuring of loans, Rs122 as bank loan default recoveries, over Rs500bn in different ‘indirect recoveries’ and Rs46bn court fines imposed.
Senator Saleem Mandviwala noted that the funds received from the National Crimes Agency, the UK, had not been deposited in the national kitty and was perhaps withheld.
The committee members expressed dissatisfaction over the explanations provided by the finance ministry and the SBP over exchange rate losses and described the government policies as “disastrous” for Pakistan.
The committee highlighted that despite the depreciation of Rs57 per dollar, the government could increase exports by only 3pc whereas its impact on inflation had been destructive.
Senator Talha remarked that people had absorbed the impact of devaluation however, the massive inflation became intolerable. He added that people were not interested in the authenticity of the exchange rate as they were trying to survive the soaring prices of commodities.
Talha said, “We are totally dissatisfied with your briefing and will issue a letter to the governor [of] SBP”. A number of the members termed the statement made by the Governor of SBP Reza Baqir in London as “uncalled for” in which he had claimed that devaluation had also benefited a large number of overseas Pakistani.
SBP Deputy Governor Murtaza Syed acknowledged that the movement in exchange rate impacted inflation but added that the recent currency devaluation did not have a significant impact on inflation as the prices were being stoked due to food commodities as well as energy prices in the international market.
Senator Talha said that the local currency was under pressure primarily due to the smuggling of dollars from Pakistan into Afghanistan and also mentioned to a person from whom a large number of dollars were seized in Lahore.
The SBP deputy governor expressed agreement with the committee chairman regarding the supply and demand situation in the market being the primary benchmark for the determination of the exchange rate. The meeting was told that a flexible exchange rate was adopted after entering the IMF program.
Senator Kamil Ali Agha remarked that the SBP governor was not a political office and should refrain from making political statements.
He said it was the responsibility of the government and the SBP to stabilize the value of the rupee. He added that Ishaq Dar was named “Ishaq Dollar” owing to his interference with the dollar, but “today there are over 24 hands involved in it”.
Senator Sadia Abbasi noted that the household budgets had jumped by 60pc during the last year and even the prices of commodities at Utility Stores Corporation had seen a sharp spike.
The committee also decided to seek clarification on Reza Baqir’s statement in London as well as seek a mechanism with respect to intervention in the exchange rate market from the SBP. Senator Abbasi insisted that the committee should also be communicated the recent negotiations with the International Monetary Fund (IMF), however, the additional finance secretary said he needed more time to provide details.
The Senate committee chairman made the decision to invite the finance adviser amongst other officials for a briefing to find out details of the recent agreement with the IMF.