ISLAMABAD: The Public Accounts Committee (PAC) Tuesday sought details and suggestions about where to utilise the Rs350.703 billion Gas Infrastructure Development Cess (GIDC), which could not be utilised so far.
In its meeting chaired by Junaid Akbar, the committee reviewed the Petroleum Division’s audit report for the Financial Year 2023-24. Audit officials told the committee that according to Section 4(1) of the Gas Infrastructure Development Cess Act. 2015, the cess shall be utilised by the federal government for or in connection with infrastructure development of Iran-Pakistan Pipeline Project (IP), Turkmenistan-Afghanistan-Pakistan-India (TAPI) Pipeline Project, LNG or other ancillary projects.
During audit of DG (Gas) for FY2022-23, it was observed that the DG (Gas) collected Rs354.046.784 billion GIDC up to June 30, 2023. However, the federal government could only utilise Rs3.343 billion on the operational cost of ISGSL and repayment of loan to the GHPL.
These funds were to be utilised on Turkmenistan-Afghanistan-Pakistan-India pipelines (TAPI), Iran-Pakistan pipeline (IP) and Pakistan Stream Gas Pipeline Project (PSGP).
However, progress on these mega gas infrastructure development projects was very slow and no significant headway could be made, resulting in non-utilization of GIDC funds of Rs350.703 billion.
Audit officials told the committee that Rs350 billion deposited in GIDC could not be used for infrastructure, adding that the Petroleum Division had spent Rs3.70 billion.
On this, the PAC chairman inquired whether these expenses had been correctly utilised.
The committee members said the GIDC was taken from the public and should have been spent on the desired purpose.
The Petroleum Division officials told the committee that the money could not be spent on the Pak-Iran gas pipeline project due to the international sanctions.
Hina Rabbani Khar asked if there were international sanctions, then why GIDC was collected from the public. “The GIDC’s Rs350 billion should be spent on alternative projects,” she suggested.
She said the committee should seek proposals from the Petroleum Division on the use of GIDC funds within a month. Secretary petroleum said the GIDC law was brought in 2015, while in 2020, the Supreme Court declared it null and void.
He said the government was working on resolving the dispute with Iran. “The money is being spent by GIDC for reconciliation of the Iran Pakistan Pipeline Project,” he told the committee saying Rs1 billion had been spent on TAPI.
The Petroleum Division secretary requested the committee to hold an in-camera briefing on the Pak Iran Gas Pipeline Project where he will give all the details.
PPP’s Naveed Qamar said the work on the IP pipeline and TAPI pipeline could not be launched due to various issues. He said the collected funds had to be used for gas infrastructure and the federal cabinet could be consulted on its alternative use.
PMLN’s Tariq Fazal Chaudhry said funds were available and a proposal should be sought from the Petroleum Division for their use.
On this occasion, Hina Rabbani Khar said the tax had been collected in the name of gas infrastructure and now it should be used for betterment of the people. During the meeting, PTI’s Aamir Dogar asked about any progress in the TAPI project.
Chairman PAC Junaid Akbar inquired what was the ministry’s proposal on utilization of the funds. He directed that the Petroleum Ministry should brief the committee on its action plan within a month.
Secretary Petroleum Division said the pipeline dispute with Iran had reached the Paris Court and the fund was being used to meet the litigation expenses. The petroleum secretary told the committee consultations were underway to resolve the issue.
Examining another audit para with regard to non-utilization of the gas development surcharge of Rs33.915 billion, the audit report revealed that Rs33 billion less was collected from the fertilizer and electricity companies in the form of gas development surcharge during the Fiscal Year 2022/23.
Audit officials told the committee that the Petroleum Division had failed to collect Rs33.915 billion in the gas development surcharge.
On this, Naveed Qamar said the GDS money did not belong to the federal government but to the provinces and that it only benefited the fertilizer companies.
Petroleum officials said low collection in the form of GDIC was due to the subsidies given to the fertilizer sector.
“Amendments have been made in the law in this regard,” the Petroleum Division officially told the committee. Syed Naveed Qamar inquired about the status of the amendment.
The Law Ministry representative could not give any answer on this, on which the committee expressed its annoyance and decided to write a letter of displeasure to the law secretary.
The petroleum secretary said the matter will go to the Council of Common Interests. Naveed Qamar said the CCI was not being called. Shazia Marri said the Constitution was being violated by not calling a meeting. The PAC also decided to write a letter to the prime minister to call a meeting of the CCI.