Audit of regulatory decisions: Ogra seeks Cabinet Division’s decision on AGP’s mandate

ISLAMABAD: The Oil and Gas Regulatory Authority (Ogra) Tuesday sought a decision from the Cabinet Division on its stance that the Auditor General of Pakistan (AGP) is mandated to conduct the audit of the accounts of the authority, whereas, the audit of regulatory decisions and determinations is not its mandate.

In a letter to the Cabinet Division, the Ogra states that the authority is left with no easy option but request the Cabinet Division to seek legal opinion from Law and Justice Division again, so that this controversy may be put to rest once and for all.

In accordance with the relevant constitutional provisions, as enshrined under Article 170 (2) of the Constitution of Pakistan (the constitution) reproduced: “The audit of the accounts of the federal and of the provincial governments and the accounts of any authority or body established by, or under the control of, the federal or provincial government shall be conducted by the Auditor General, who shall determine the extent and nature of such audit”.

The authority is of the view that above referred very fact has been explicitly elaborated through the advice imparted by the Ministry of Law and Justice vide its letter dated October 2, 2019.

There is no legal provision under the OGRA Ordinance, which provides for audit of regulatory functions of the OGRA by the AGP.

In terms of Section 13 of the OGRA Ordinance, 2002, only the OGRA Authority itself can review its decision on the basis of any additional information or change of circumstances, relating thereto.

The OGRA observes that the Public Accounts Committee (PAC) vide its directives on August 10, 2020, has only upheld the sanctity of the constitutional provisions, and it nowhere directed that the regulatory decisions of the authority can be audited, assessed or evaluated to be correct or otherwise by the AGP, beyond the purports of the Constitutional provisions and the OGRA Ordinance.

The parliamentary body, the PAC directives issued on August 14, 2020, endorsed the Ogra’s view that “AGP has the jurisdiction to conduct their (Regulatory authorities-words added) audit,” which is limited to the audit of accounts and financial performance, in consonance of the constitutional provisions.

However, the AGP’s demand to audit regulatory decisions of the Ogra is beyond the scope of the AGP, and contravenes the constitutional provisions as well as the OGRA Ordinance.

As reflected in its letter on September 16, 2020, the AGP continues to hold that Law and Justice Division’s opinion has been superseded by the aforesaid directives of the PAC on August 10, 2020, and that it has a binding impact.

The Ogra is firm about the sanctity of the OGRA Ordinance, 2002, backed by the Constitution, which retains its inherent supremacy over any conflicting decision taken by the institutions established thereunder. Since a clear difference of opinion has emerged between the interpretation of the AGP and the Law and Justice Division.

Copyright Business Recorder, 2020