Outsourcing of financial services to private entity: IHC appoints AGP, CMA as amici curiae

ISLAMABAD: The Islamabad High Court (IHC) on Monday appointed the Accountant General of Pakistan and the Controller of Military Accounts as amici curiae in outsourcing of financial services by Pakistan Post to a private entity.

A single bench of Chief Justice Athar Minallah heard the petition filed by Ahsan Naveed Farooqi and deferred the hearing till Tuesday (today) after issuing the directions.

During the hearing, Naseer Ahmed, director general (DG) Pakistan Post appeared along with Syed Muhammad Tayyab, the deputy attorney general.

The IHC bench asked the official of the Pakistan Post that what services rendered by the Pakistan Post had been outsourced to the private bank.

He stated that Pakistan Post disbursed pensions to retired soldiers and employees of the armed forces in grades 1 to 16, retired employees of the Pakistan Telecommunication Company Limited, and the Pakistan Post.

The court then asked who pays for the services rendered by the private bank?

He initially informed that the fee was deducted from the payments made to the pensioners but later stated that he was not sure.

He also could not inform the court about the total amount paid as consideration to the private bank.

He could not satisfy the court that whether the Pakistan Post was legally empowered under a particular law to perform functions, which otherwise fell within the exclusive domain of two government institutions i.e. the Accountant General of Pakistan and the Controller of Military Accounts.

He was also not able to point out the relevant law, which empowers the Pakistan Post to deduct fees from the payments made to the pensioners.

There was no explanation why the fee is not being deducted from the pensioners who retire from the service of the Pakistan Post.

Justice Minallah noted in the order, "The questions raised in the instant petition are of paramount public importance. It, prima facie, appears that deduction of fee from payments made to pensioners is in violation of their constitutionally guaranteed fundamental rights. It also, prima facie, appears to this Court that the payment made to a private bank and outsourcing of services relating to payment of pensions in case of some classes is an unnecessary expense and a burden on the exchequer because it is an intrusion in the mandate and functions assigned to the Accountant General of Pakistan and the Controller General of Military Accounts."

Therefore, the court directed the director general, Pakistan Post to nominate a senior official to appear before this Court and explain the aforementioned queries, and to satisfy this Court why an injunctive order may not be passed restraining deduction of fee from payments made to the pensioners.

"Keeping in view the importance of the questions raised in the petition in hand, this Court deems it appropriate to appoint the Accountant General of Pakistan and the Controller of Military Accounts as amici curiae for assistance.

M/s Habib Bank Limited is also impleaded as a respondent," added the IHC bench.

The court continued that the Accountant General of Pakistan and the Controller of Military Accounts are requested to submit a joint report regarding the following questions; i. How and under what authority of law Pakistan Post is disbursing pensions to some classes of pensioners? ii. Why retired employees of the armed forces in grades 1 to 16 are treated differently from those who are in the higher grades? iii. Why the disbursement of pensions cannot be made by the established institutions of Accountant General of Pakistan and the Controller General of Pakistan as is being done in case of other pensioners? iv. Can deductions in the form of fee be lawfully made by the Pakistan Post from payments made to pensioners and that too for services, which exclusively fall within the domain of other institutions of the government? v. In case the answer to (iv) is in the negative, then whether the pensioners will be entitled and eligible to refund of the amounts deducted as fee and by whom? vi. Can disbursement of pensions be outsourced to a private entity under the law?

The IHC CJ said the amici curiae are expected to submit their joint opinion on or before July 14 and the secretary, Ministry of Communication and the director general, Pakistan Post are directed to submit their respective comments, satisfying this Court regarding the questions framed.

Copyright Business Recorder, 2020