Senate body approves SBP Amendment Bill 2015

ISLAMABAD: The Senate Standing Committee on Finance on Thursday approved State Bank of Pakistan (SBP) (Amendment) Bill 2015 for granting autonomy to the central bank whereby senators asked the government to include parliamentarians into monetary policy committee (MPC) who fulfill fit and proper criteria.
Under the IMF’s condition, the SBP (amendment) bill will exclude secretary finance from monetary policy committee in order to make central bank more autonomous and independent. However, the parliamentary committee refused to approve Anti-Money Laundering (AML) amendment bill and decided to call representatives of business community, tax bars and other stakeholders to finalise list of financial crimes which can be tried under AML, having far reaching implication internationally who will be charged under it.
Senator Ilayus Bailour severely opposed AML amendment bill and said that the PPP and PML-N struck compromised deal for appointing chairman on GIDC (Gas Infrastructure Development Cess) committee yesterday by selecting chairman of the committee Iqbal Zafar Jhagra who is Secretary General of PML (N).
Senator Kamil Ali Agha of PML-Q and Mohsin Aziz of PTI supported the stance taken by Illayus Bailour and stated that it was part of “Muk-Muka” of PPP and PML-N.
Senator Ilayus Bailour told the committee that he was recently issued tax notice by the FBR on wrong grounds and if business community would be implicated into tax fraud charges under AML then the FBR officers should also be implicated into same charges in case of framing wrong allegations.
Secretary Finance Dr Waqar Masood tried to convince the enraged senator by arguing that there were legal forums available to rectify wrong tax notices. “If FBR harassed senator and member of finance committee then how common citizen will be dealt by the tax machinery,” Bailour replied back by raising this question.
The list of fiscal offenses for inclusion into AML was reduced from 26 to 9 and now the government agreed to proposal of the committee to further reduce the list to major tax frauds including income tax, sales tax and federal excise duty. The committee also asked to consult Financial Monitoring Unit (FMU) before framing charges under AML amendments.
However, the parliamentary panel of Upper House approved SBP (amendment) bill 2015 with couple of recommendations including changing composition of members of the monetary policy committee (MPC) and getting approval of board for appointing three renowned economists into the monetary committee.
The parliamentary panel approved changes into composition of MPC as number of members appointed from board of directors of SBP was reduced from 4 to 3 while number of renowned economist was increased from 2 to 3 with the recommendation of the SBP Board and 4 members would be nominated from the central bank including governor SBP.
The chairman of the committee Saleem Mandviwalla asked the government to include parliamentarians into MPC and he was supported by Senator Kamil Ali Agha and Mohsin Aziz but the secretary finance opposed this proposal by stating that such proposal should not be specified. Referring to SBP Act 1956, secretary finance said that the legislators could not be appointed as members of board of directors of the central bank.
But the senators were of the view that Parliament could change the law. Senator Ilayus Bailour said that the government should strictly follow provincial quota for nominating members of the board and monetary policy committee of the SBP.