Irregularities of billions of rupees: PAC slams award of 295-km Multan-Sukkur Motorway contract at higher rates

ISLAMABAD: The Public Accounts Committee (PAC) Wednesday sent back the audit para of irregularities of over billion of rupees in Multan-Sukkur 295 kilometer section of Motorway in the Departmental Accounting Committee of the Communication Ministry for re-examination of audit para after the department of Auditor General of Pakistan (AGP) pointed out the irregular award of contract of Multan-Sukkur section of Motorway at higher rates that caused a loss of Rs166.174 billion to Chinese company under the China-Pakistan Economic Corridor projects.

The department of the AGP pointed out violations of the PPRA rules in awarding the contract of 295km section of Multan-Sukkur Motorway and detected the difference of over Rs93 billion in figures and referred back the para in the departmental Accounting committee of the Communication Ministry. But at the same time, the PAC settled the mostly audit paras relating to different sections of Karachi-Multan Motorway.

The meeting of the PAC was held with the chair of its Chairman Syed Khursheed Shah in which the audit paras relating to the Department of Communication Minister and National Highway Authority for the financial year 2016-17 were examined.

While examining the audit paras, the Audit officials pointed out the irregular award of contract of Multan-Sukkur section of Motorway at higher rates that caused a loss of Rs166.174 billion to Chinese company under the China Pakistan Economic Corridor projects.

The audit officials maintains that the project of which cost estimates were prepared by M/s CSCEC for Rs240.158 billion was awarded to same contractor at higher rates of Rs166.174 billion. The Audit observed that the cost/bid reduction of Rs11.980 billion was due to deletion of some components/scope/items from the BOQ basis for reduction/detailed calculation to arrive the amount to be deleted from bid amount were not mentioned in the record in support of deletion of Rs111.980 billion against each deleted items/scope of work.

The officials of the Communication Ministry told the committee that this project is a part of the China Pakistan Economic Corridor and it was condition that the project only be awarded to the Chinese company. They told the committee that the Chinese contractor firm has prepared the feasibility report.

The PAC member Dr Azra Fazal expressed her reservation on the quality of the Multan-Sukkur section of Karachi-Lahore-Peshawar Motorway saying that the whole load of CPEC will be on this track but the thickness of the road has been reduced that will create the problems in the future.

The officials of the Communication Ministry assured the committee that the quality work would not be compromised.

The PAC sent back the audit para at the level of the departmental accounting committee to settle the differences of figures and settle the conflicting issue before coming back to the committee.

PAC Chairman Syed Khursheed Shah expressed concerns and reservation over awarding the contract to Chinese company for Sukkur-Hyderabad section of Motorway and on expensive rates.

The PAC chairman said the contract for Sukkur-Hyderabad was being given on Rs260 billion that is above 42 percent on the current rate and though it was first section of motorway in Sindh yet on such an expensive rate.

‘The price of the project has to be paid by the people of Sindh and they will pay the price for 25 year,” he said. He said he has written a letter to the NHA yet not received any response. “But I want to make clear that I will not allow the project on such expensive rates and if this project was started on the higher rates then I will opt to go into the courts of law,” he said. Khursheed Shah said if the open bidding of the project be conducted then Pakistani companies will also participate and significant reduction will also come in the rates.