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May 10, 2021

Awarding multi-million project to ‘blue-eyed people’

PESHAWAR: Instead of taking action against those responsible for awarding a multi-million project of revenue enhancement to blue-eyed people and inflicting huge financial losses on the multi-billion Water and Sanitation Company, Peshawar, the matter has been referred to the Local Government Department for external investigation.

The matter came to the limelight in the internal audit report in July 2020 and was substantiated by an internal committee formed to further investigate

the issue in December 2020. Both the forums recommended strict disciplinary action against those responsible for awarding the contract to the same company for two different time periods, sources told The News.

However, the elements responsible for awarding the contract and undertaking the project were influential enough and no action could be taken against them while committees after committees were formed in the name of further investigation owing to delaying tactics.

The latest decision of holding an external probe was taken in the 39th meeting of the board of directors of the WSSP held on March 30, 2021. The chief executive officer of the company wrote a letter to the secretary Local Government Department seeking further investigation of the matter in light of the BoD’s last meeting. A copy of the letter is available with The News.

The letter stated that M/S Swiss Agency for Development Cooperation (SDC) in its two-year project (December 2017 - December 2019) funded around Rs173.8 million in seven major activities for the strengthening and capacity building of various WSSP departments.

The revenue enhancement through door-to-door survey (GIS-survey was one of these activities) having an estimated cost of Rs36 million, the letter said. The WSSP through a competitive bidding process selected M/S Urban Unit Lahore to undertake the activity.

M/S Urban Unit executed the GIS survey in 67 urban and peri-urban union councils of Peshawar by electronically gathering the data through android based application and concluded their work in March 2020, the letter added.

The ex-Chief Internal Auditor in his audit report raised concerns over handed over deliverables of GIS survey. The report along with recommendations was presented in the audit committee in its 12th meeting held on December 9, 2020. The committee recommended to refer the audit report to the chief executive officer of WSSP to take appropriate action and impose penalties, the letter stated.

However, the CEO WSSP constituted an internal inquiry committee to review the report of the ex-auditor and to make recommendations before imposing any penalties. The inquiry committee issued a detailed report having significant input of all the concerned stakeholders, which was presented in the audit committee.

The audit committee recommended to the BoD WSSP to refer the case of GIS Survey project of revenue enhancement through door-to-door consumer survey along with its inquiry report to the government of KP for external probing, the letter said.

It merits a mention here that the matter was first highlighted by The News in an investigative story in July 2020. According to the reports, serious irregularities had been highlighted in the internal audit report of the company that had been submitted to the chief executive officer of the company in November 2019. The report had recommended penalties besides highlighting the irregularities. But instead of taking action in line with the report, the matter was referred to other committees for further investigation.

According to the audit report titled “Revenue Enhancement Through Customer Survey (GIS)” (copy available with The News), the contract for the survey was awarded to the same company for two different years to identify means for revenue enhancement. Both the contracts cost Rs40 million, but it failed to bring any financial benefit to the company.

“Internal Audit learnt that the same survey titled as “Consumer Survey of WSSP Peshawar” had been conducted under WSP World Bank in 2015 for Rs11,000,000 (Rs11 million). The Surveyor was the same - The Urban Unit and Manager MIS was the Focal Person for the activity,” the report says.

The same survey was given to the same surveyor in 2018, but this time at a cost of Rs29,000,000 (Rs29 million).

The second survey was just a replica of the first one, which too didn’t consist of real time data and thus failed to help enhance the revenue of the company, The News reported earlier.

The audit report in its findings noted that the activity did not result in any economic value to WSSP as the customers remained the same in 2018 as they were in 2015 i.e. 57,000.

The payment of Rs11,000,000 was wastage of financial resources and there was no value for money. No records were made available for the 2015 survey so beneficiaries can’t be determined, the report added.

It pointed out that the process of competitive bidding was not complied and the contract was awarded against the KPPRA Rules 2014, which resulted as mis-procurement.

The assignment of Survey 2018-2019 was generated with the same scope and objectives as the survey of 2015.

If 124,246 customers were identified in 2015then due to urbanization and population growth the WSSP customers’ database could have reached 150,000 in 2018 whereas WSSP had 57,000 customers in 2018 and it still repeated the survey, the report stated.

Even payment to the surveyor was made against the terms of reference and without having satisfactory review of the contract, the report pointed out.