ISLAMABAD - The riddle of payment of Rs 80 billion to the IPPs could not be solved as the auditor general of Pakistan has taken the position that they had not permitted payment without pre-audit whereas the Energy Ministry is adamant that permission had been granted.

In response to the remarks of the power federal secretary that the auditor general of Pakistan had given them a go ahead for the payment of Rs 80 billion to the IPPs without pre-audit, the spokesman for the AGPR said the auditor general of Pakistan never conveyed any order to the Power Division to authorise the payment of Rs 80 billion to the IPPs without fulfilling legal and codal formalities.

However, when contacted by The Nation, an official spokesman for the Ministry of Energy said that in letter No 76/876-P-I/Pre-Audit/IPPs, the auditor-general of Pakistan had conveyed that they would look into the adequacy and sufficiency of the CPPAG’s pre-audit checks and their consistency with the pre-audit framework as prescribed by the auditor general for Pakistan would be ascertained at the time of post-audit in due course of time.

The spokesman for the AGP further said the AGP office had prescribed the pre-audit checks for the purpose of pre-audit by controller general of accounts and all payments from the national exchequer were made following the prescribed rules and regulations.  The AGP had never conveyed any such orders to authorise the payment without fulfilling legal and codal formalities while the role of the AGP was to conduct post-audit of payments, the spokesman said.

Regarding the pre-audit of the IPPs’ invoices as on December 31, 2017, by the controller general of accounts, the Ministry of Energy spokesman said they had written a letter to the office of controller general of accounts in this regard and he had responded that, according to the ECC’s decision, payment to the IPPs shall be released for the invoices verified by Central Power Purchasing Agency (CPPA) up to the billing month of December 31, 2017. Moreover, the CPPA would ensure adherence to the prescribed procedure of payments in vogue, including reconciliation and pre-audit.

They further said, “The audit of all such payments has been the responsibility of BAO (CPPA) working under DG audit (Wapda), now DG audit (power), and accountant-general of Pakistan revenue has no role in pre-audit. It is, therefore, requested that the DG audit (power) and BAO (CPPA) may kindly be advised to undertake the required audit as per previous practice.”

The director general audit (power) also said they were entrusted with the task of post-audit of the accounts of the CPPA only.

When the circular debt crossed Rs 500 billion, the ECC approved a plan to settle power sector payables, which will ensure normal functioning of the government-owned companies, including the PSO, the SSGC, the SNGPL, Gencos, Discos and nuclear power plants.

As an immediate measure, it was decided that Rs 80 billion commercial loans would be raised through Power Holding Private Limited (PHPL) and used in retiring the circular debt.

The decision was taken by the ECC as the government wants to pay 50 percent of total overdue amount to enable the IPPs to function in full capacity till September 2018.

Following the ECC decision, the Ministry of Energy wrote a letter to the AGPR for the pre-audit of the invoices of the IPPs, but they refused to do so.

The AGP responded to the Ministry of Energy that according to Section 5(b) of Controller General of Accounts Ordinance XXIV of 2001, all payments and withdrawals from the consolidated fund and public accounts of the federal or provincial governments, against approved budgetary provisions, may be authorised by the Controller General of Accounts after pre-audit checks as prescribed by the auditor general of Pakistan. Now the government has already released a major portion of the Rs 80 billion for retiring the circular debt.