A two-billion rupee scam related to computerisation of Utility Stores Corporation (USC) will echo in the Ministry of Industries and Production (MoI&P) on Tuesday (today), reliable sources in the Ministry told Business Recorder. A presentation on a Rs 2 billion project will be given to the Minister for Industries and Production, Mir Hazar Khan Bijarani today.
However, a three-member squad, headed by an outsider claiming close connection with federal minister is reportedly using all his resources to award the project to a 'specific' company without seeking approval from the Central Development Working Party (CDWP) or Executive Committee of the National Economic Council (Ecnec) - a mandatory requirement for every project with this volume of investment, the sources added.
The group has different front men in different organisations and attached departments of the MoI&P spreading from Islamabad to Karachi and Lahore. In the present case, two members of the group represent the airline business whereas the third is a USC insider.
"They are involved in changing the legal advisor, transport companies which supply commodities to USC, supply of bags to NFML for urea fertiliser and a Karachi-based organisation," the sources added. Three top ministries present in A Block of Pak Secretariat, i.e., Ministry of Water and Power, Ministry of Petroleum and Natural Resources and Ministry of Commerce are already facing mega financial scams.
The MoI&P has submitted a summary to the Economic Co-ordination Committee (ECC) of the cabinet for ex-post facto approval of additional charges for transportation of imported urea from Gwadar port. The government, as a policy, has fixed reserve wheat price at Rs 950 per 40 kg for Rabi 2008-09. The National Fertiliser Marketing Limited (NFML), a subsidiary of MoI&P was entrusted to transport urea from Gwadar to up country.
The ECC approved the additional freight charges @ 96.90 per bag for transportation from Gwadar to up country. The ministry claims that the NFML after following the bidding process awarded contract to 'carriage contractors' for transport of fertiliser. The MoI&P has requested the ECC to accord ex-post facto approval of Rs 1,370,586,643 for 14,144,341 bags used to transport of 707,217.05 MT of urea.
Public Procurement Regulatory Authority (PPRA), sources said, has barred Public Sector Entities (PSEs) from price matching considered as corrupt practice. Managing Director, PPRA in a letter to federal secretaries has stated that time and again public procuring entities have agitated the lack of legality of matching prices with the lowest evaluated bidder in the event the bidder fails to execute the contract as per spelled out requirements.
However, MoI&P in its summary which is available with this scribe submitted that all codal formalities under PPRA rules 2004 were followed while granting the contract for the transportation of urea and no violation/deviation whatsoever has been made from PPRA rules 2004.
The expenses incurred by NFML are subjected to audit by commercial audit wing of Auditor General of Pakistan and private sector auditors (namely Hyder Bhimji & Co Chartered Accountants, Lahore), appointed by the Board of Directors as per company law. Pakistan Steel Mills (PSM), a PSE of the MoI&P is also facing a multi-billion rupee scam. The main accused in the scam are still at large despite the directives of the Supreme Court of Pakistan.