LAHORE - Official spending worth Rs 21.125 billion is under scrutiny of the Punjab Assembly’s Public Accounts Committee as different provincial departments have been found involved in embezzlement, fraud, misappropriation of funds and unauthorised payments.

Among the key audit findings of the report include unauthorised payments of Rs 1.511 billion which was noticed in seven cases in different departments. Besides, 20 cases amounting to Rs 3.193 billion pertained to non-production of record while embezzlements, misappropriations and fraud amounting to Rs 635.77 million were noticed in seven cases.

There were also 18 cases of irregular expenditure, payments and violation of rules amounting to Rs 11.269 billion. Recovery worth Rs 3.659 billion was pointed out in 10 paras.

Lack of internal controls was noted in six cases amounting to Rs 548.20 million. There were three cases pertaining to non-protection of assets amounting to Rs 102.31 million. Non-adjustment of advances was noticed in two cases worth Rs 142.85 million.

The auditor general’s report for the financial year 2014-15, recently submitted in the Punjab Assembly for its inspection, makes revelations about the issues of weak internal controls, inappropriate use of public funds, disregard to prescribed regulatory framework, ineffectiveness of systems to curb irregularities, poor record management, lack of transparency and objectivity in public procurement and mismanagement of public receipts.

With regard to the amount in question, the audit report indicates that the expenditures incurred were not in conformity with the laws while expenditure was not incurred with the approval of the competent authority. In most of the cases, the money shown as expenditure in the accounts was not authorised for the purpose for which they were actually spent.

As per details, auditable expenditure under the jurisdiction of Directorate General of Audit, Punjab, was Rs 889.415 billion of which recovery of Rs 4.43 billion was pointed out by audit, but an amount of Rs 349.34 million was actually recovered during the year 2014-15 at the time of compilation of the report.

Of the total recovered amount, Rs 90.46 million were not into the notice of the executive before audit.

The report identifies control failure in maintenance of records, delegation of powers, purchase procedure, its handling and storing, contract administration and execution, payroll procedure, asset management, budgeting and financial control, utilisation of grants and development funds.

As per Punjab Government Rules of Business 2011, the finance department is responsible for management, supervision and control of provincial finances. But ironically, even this department is not adhering to the relevant rules according to the audit report.

Examination of the record of the Punjab finance secretary for the period 2013-14 revealed that non-investment of GP Fund amounting to Rs 4 billion caused loss to the provincial exchequer

The auditor general, in its report, noted that rules of the Punjab General Provident investment Fund had been framed in 2009 and the finance department was required to invest this fund without any loss of time, but no such action was taken. The matter was also pointed out during the previous year audits, but again no action was taken by the management.

During audit of the food department, it was observed that expenditure was incurred on constructions/repairs. However, no record was produced to audit. Moreover, record was not produced to verify the transfer of Pp jute bags.

An unauthorised payment of sales tax amounting to Rs 212.61 million also came to surface during the audit. According to Sr. No 52 (a) under sixth schedule of the Sales Tax Act, 1990, operating hospitals of 50 beds or more or teaching hospitals of statutory universities of 200 or more beds are exempted from payment of sales tax. During the audit of various formations of the health department, it was observed Rs 212.609 million were paid on account of GST in respect of various payments despite the fact that the hospitals were exempted from the payments of sales tax.

Unauthorised payments of share money (Rs 45.76 million) were made to doctors during the financial year in question. As per rules, only those doctors who are not receiving non-practicing allowance (NPA) will, however, be entitled to share of fees.

Moreover, the share money was also paid to the doctors and staff related to the administration and not providing services in the requisite laboratories.

Audit has recommended recovery of the unauthorised payment, besides fixing responsibility for negligence.

During audit of the health department, it was observed that managements made irregular payments of Rs 31.87 million on banned items like vehicles, furniture & fixtures, machinery & equipments, including IT equipment, printers, fax machines, photocopiers, generators, air-conditioners, and luxury items without approval of the austerity committees.

Authorities in the home department failed to produce record of loss of vehicles and weapons amounting to Rs 27.49 million. It was observed that some vehicles, motorcycles and arms were stolen or burnt in protests or badly damaged in accidents. Although the department got FIRs registered with the police stations concerned, record pertaining to any departmental inquiry, if held, was not produced to the audit.

The home department audit observed that fixed daily allowance, risk allowance, conveyance allowance and special pay packages worth Rs 41.59 million were paid to the police officials who were under suspension or remained on leave or training for more than 11 days in a calendar month. This amount was sanctioned by the finance department for the police staff, but the said salary package was not admissible to officers for the period they remained under suspension.

During audit of the information and culture department for the period 2013-14, it was observed that the Punjab government allocated loan of Rs 1.603 billion for Lahore Press Club Housing Scheme, but the same was not recovered. The Punjab Journalists Housing Foundation is working under the supervision of the provincial information secretary.