Auto-makers holding Rs150bn of people, PAC told

ISLAMABAD: The Public Accounts Committee has expressed its serious concern over delays in delivery of vehicles despite vehicle manufacturers taking advance money and has directed all companies to provide details of the advance money collected from the people to the Office of Auditor General of Pakistan.

The Auditor General of Pakistan revealed in the Public Accounts Committee on Thursday that the auto companies had kept more than Rs150 billion of people. The meeting of the Public Accounts Committee was held under its Chairman Noor Alam Khan in which the audit paras related to the Ministry of Industries for the year 2019-20 were examined.

The Public Accounts Committee asked the Ministry of Finance and State Bank to provide the record of bank accounts of car manufacturers within 10 days and also directed the chairman Federal Board of Revenue to provide tax details of car manufacturing companies to the committee within 10 days.

The PAC meeting was focused on the issue of delays in the delivery of vehicles and quality of cars manufactured in the country. The Auditor General of Pakistan revealed in the Public Accounts Committee that the auto companies had kept more than Rs150 billion of the people. He told the committee that his department has sought financial statements from car manufacturers but it was not provided.

Secretary Ministry of Industries has also made a complaint to the committee that the car manufacturers did not provide the record to the ministry.

PAC member Senator Shibli Faraz remarked that the Ministry of Industries had promoted the trend of ‘own money’ on cars and completely failed to stop this practice. He said if car plants are run on full capacity, vehicles can be delivered immediately.

While expressing his annoyance over delays in delivery of cars, Chairman PAC Noor Alam Khan said delaying tactics were adopted in the delivery of vehicles and payment was also taken along with it.

Noor Alam Khan said the companies were earning billions of rupees due to delays in delivery of vehicles while customers’ money was being taken and they were humiliated while giving vehicles. He said vehicles made in Pakistan lacked quality and there were no safety features in vehicles. If standard vehicles are not made locally, then import should be allowed.

Chairman PAC Noor Alam said the quality that car manufacturing companies are providing in Japan and other countries was not being provided in Pakistan. He said the price of locally-manufactured vehicles has reached one crore rupees. When he bought a car worth more than one crore and when he sat on the seat, back pain started.

He said if people gave advance money for car booking, then dollar should not have any effect on the price of car and people should get the car on the same price they had paid in advance.

The representatives of car manufacturing companies replied that they were following the rules of WP 29 for safety. The chairman PAC said in Pakistan they were following Euro 2 while the world had reached Euro 5 standards and the world had moved towards electric cars. “We will not leave you until the Pakistani people get quality vehicles,” he said.

Committee member Ramesh Kumar said 50 percent of the spare parts of vehicles were being imported. Committee member Sheikh Rohail Asghar said every brand of car was manufactured in the neighbouring country but there was implementation of law. “However, in Pakistan, the same companies make excuses of dollar rate,” he said.

During the meeting, the committee expressed its annoyance over the repeated interference of CEO of a company. Committee member Nisar Cheema said the committee should write to the company to send a decent person to the committee for briefing. The CEO apologised to the committee.

Chairman Committee Noor Alam Khan said that chairman FBR has not sent tax details received from vehicle companies. Chairman Committee Noor Alam summoned the chairman FBR for not providing the details.

The chairman PAC asked about the provision of old technology tractors in the country. A car company representative said that if tractors with modern technology are made, prices will further increase.

Noor Alam Khan said that Pakistanis have a lot of money, if they give you money for cars, then they will also give money for tractors. Committee member Birjees Tahir said that companies increase the price of vehicles every day as much as they want.

A representative of a company told the committee that last year they sold vehicles of Rs108 billion, gave Rs44 billion to the government, and made a profit of Rs2.3 billion rupees, which is two percent.