Lavish concessions to KESC: TI Pakistan files reference with NAB against Prime Minister, others

Transparency International Pakistan has filed a reference with the National Accountability Bureau (NAB) against Prime Minister Syed Yousuf Raza Gilani, federal ministers and Managing Director KESC for allegedly causing financial loss to national exchequer by giving billions of rupees benefit/concessions to KESC illegally.
This is the first reference filed by the Transparency International Pakistan through its Advisor Syed Adil Gilani with the NAB against any top government office holder. Besides Prime Minister, Minister for Finance, Minister for Water and Power and Minister for Petroleum and Natural Resources have been made party to the reference.
According to the reference, respondents to the complaint do come within the ambit of NAB Ordinance 1999 for the purposes of investigation, trial and punishment. The respondents are reportedly guilty of corruption and corrupt practices as defined in Section 9 of the NAB Ordinance (sub section iii, vi and vii If he dishonestly or fraudulently misappropriates or otherwise converts for his own use, or for the use of any other person, any property entrusted to him, or under his control, or wilfully allows any other person to misuses his authority so as to gain any benefit or favour for himself or any other person, or to render or attempt to do so and if he has issued any directive, policy, or any SRO (Statutory Regulatory Order) or any other order which grants or enables any concession or benefit in any taxation matter or law or otherwise so as to benefit himself or any relative or associate or a benamidar; and as such are subject to punishment under section 10 of the Ordinance based upon the following facts and grounds:
Facts and Grounds: On 14th October 2011 Transparency International Pakistan requested the Prime Minster to take notice of the following alleged illegal amendment agreement of KESC for termination of the unconstitutional concessions granted to them. That Transparency International Pakistan has received recently a complaint along with the copies of the shareholder agreement of November 14, 2005 and amended agreement of April 13, 2009, with following detailed complaints and serious issues pointed out 1 -amended agreement is illegal as it has been signed by Shahid Rafi, Secretary Power on April 13, 2009. Whereas, according to the ECC decision of October 14, 2008, the amended agreement was to be singed by the Privatisation Commission.
2. Original shareholders agreement was signed by Secretary Privatisation Commission on November 14, 2005.
3. Extraordinary financial concessions granted to KSEC, a private company, which runs into billion of rupee per annum, are illegal as ECC or Cabinet does not have authority to dole out Government Revenue (taxpayers money) to a private company M/s Abraj .
4. Marginal cost price of electrical power supplied by NTDC to KESC. Transparency International Pakistan is of the view that Discos status to KESC, which means buying Wapda electricity at 25 to 30 per cent of the current rates. This concession was denied to all previous management's of KESC for years, not given even by Pervez Musharraf to army generals running KESC.
5. Five years guaranteed supply of 650 MW at marginal cost price of electrical power. This has allowed M/s Abraj not to install new Power Plant, and caused shortage of electricity in Pakistan.
6. Application to NEPRA in relation to the unbundling of generation etc.
7. Guaranteed gas allocation for supply of Gas for new 560 MW power plant. No new power plant erected. But KESC is being provided gas by SSGC or furnace oil by PSO on gas rates.
According to press report "'No load shedding' in Ramazan: billions to be paid to KESC "printed in daily "BUSINESS RECORDER" dated 22nd November 2011 it is reported that the federal government is to extend billions of rupees to KESC as difference in furnace oil and gas prices to ensure power supply in Ramazan, and that the price differential approximately Rs 2.6 billion between the HSFO and gas would be directly paid by the Finance Division through Ministry of Water and Power within 30 days from the date of submission of claim, and price differential claim will be submitted by PSO duly verified by SSGC and KESC to Ministry of Water and Power for reimbursement by Finance Division within one month.
The proposal in principle was with the direction that modalities for reimbursement of price differential claims would be decided by the Ministry of Petroleum and Natural Resources, in consultation with Ministry of Finance and Ministry of Water and Power.
The complainant has also provided Transparency International Pakistan with the copies of documents of the Minutes of the Meeting held at the Governor House Karachi dated 29 July 2011, which were sent to PSO on 051-22641115 from the President's Office on 19th October 2011. Chronology of events after Transparency International Pakistan letter was sent to the Prime Minister on 4 October 2011.
a) On 14th October 2011 Transparency International Pakistan requested the Prime Minster to take notice of the alleged illegal Amendment Agreement of KESC for termination of the unconstitutional concessions granted to them.
b) No action was taken by the Prime Minister.
c) On 18 October 2011 GM (Consumer Business), PSO, Karachi Ministry of Petroleum and Natural Resources, Islamabad informed (along with Minutes of Meeting dated 29th July 2011) that PSO has received no written directives on the issue of supply of fuel in Ramzan to KESC.
d) On 19th October 2011, the President of Pakistan Office Islamabad faxed the letter of GM (Consumer Business) PSO and the minutes of meeting of July 29, 2011, to the PSO office in Islamabad on 051-22641115 for illegal grant of Rs 2.6 billion concession to KESC.
e) On November 1, 2011 Ministry of Petroleum and Natural Resources submitted a summary for ECC vide case No ECC-144/15/2011.f) On November 11, 2011, ECC approved the summary of Ministry of Petroleum and Natural Resources, submitted summary for ECC vide Case No ECC-144/15/201, that the modalities for the reimbursement of price differential claim would be decided by the Ministry of Petroleum and Natural Resources in consultation with the Finance Division and Ministry of Water & Power. Conclusion: Based on the above facts and grounds respondents have shown wilful indulgence in corrupt practices under Section 9 of the NAB Ordinance. Such persons are subject to punishment under section 10 of the NAB Ordinance. As such the Chairman NAB is called upon to initiate investigation in connection with matters and further proceed to file a reference against respondents for violating the provisions of section 9 of the NAB Ordinance punishable under section 10 of the NAB Ordinance in competent Court of Law.