ISLAMABAD -  Various government and private entities owe over Rs232 billion to ex-Wapda power distribution companies (Discos), official documents revealed.

Owing to increasing receivables, the PEPCO was facing financial difficulties in discharging its obligations towards Power Sector Companies (PSCs) and Independent Power Producers (IPPs), according to an audit report of the Auditor General of Pakistan.

According the audit report, various dead and running government and private entities owe Rs2,32,456.29 million to Discos.

In this respect, no efforts were made by the Discos management to accelerate the recovery from defaulters, the report added.

According to para-1.3 of commercial procedure, the revenue official and assistant manager are responsible for implementing, in conjunction with the executive engineer, the commercial policy laid down from time to time by the authority through the company and efficient application of collection procedure.

Non-adherence to commercial procedure resulted in non-recovery of Rs232456.29 million from energy defaulters up to financial year 2014-15, the report added.

Sukkur Electric Supply Company has a receivables amount of Rs71,809.09 million, Lahore Electric Supply Company (LESCO) Rs45,468.97 million, Tribal Electric Supply Company (TESCO) Rs38,097.61 million, Quetta Electric Supply Company(QESCO) Rs35,170 million, Hyderabad Electric Supply Company Rs22,698.38 million, Peshawar Electric Supply Company (PESCO) Rs12,674.48 million, Gujranwala Electric Power Company(GEPCO) Rs6,274.91 million, Islamabad Electric Supply Company (IESCO) Rs177.53 million, Faisalabad Electric Supply Company (FESCO) Rs66.72 million, and Multan Electric Power Company (MEPCO) Rs18.60.

The matter was taken up with the management during September to November (2015) and reported to the ministry during October-December 2015.

The management replied that it was a continuous process and either the recovery was made or recovery from running and dead defaulters was being pursued vigorously as per SOP of the department. However, the reply from the management failed to satisfy the auditors as no documentary evidence was furnished in support of reply.

The departmental audit committee, in its meeting held on January 20, 2016, directed the management to make concerted efforts for recovery of receivables from defaulters and also to analyze the trend of recovery with previous years and get it verified from the audit within a month. However, no progress was in this regard so far.

Similarly in Discos, tariff differential subsidy claim of Rs 86,636.57 million was recoverable from the federal, provincial and AJK governments in respect of tariff differential, agriculture and GST subsidy as on June 30, 2015. Non-recovery of long outstanding dues/settlement of disputed claims were a recurring loss to the company which was required to be recovered to enable the company to overcome its financial crises.

According to SOP issued by the ministry of Water and Power dated May 12, 2007, each Disco was required to submit its subsidy claim to Engineering Advisory (Power) on 5th of every month and finance division (AGPR) will scrutinize and verify the invoices and pay the subsidy amount due to Disco into Escrow Account of Discos strictly on the 20th of month.

The matter was discussed with the management and they claimed that in case of HESCO, LESCO, PESCO and QESCO an amount of Rs 8574.19 million had been recovered while the efforts are being made to recover the remaining amount.

However the reply didn’t satisfy the audit as their claim was not substantiated with evidence.

The departmental audit committee, in its meeting held on January 20, 2016, directed the management to submit detailed reply with justification, get the recovery verified within a week, expedite the matter of recovery from the concerned governments and get it verified from the audit within a month.