Imran Khan's govt violates IMF agreement, delays audit report on COVID-19 spending
Islamabad, Pakistan: In violation of the International Monetary Fund (IMF) agreement, the Imran Khan-led government has asked the Auditor General of Pakistan (AGP) to delay a special audit report on COVID-related spending after the auditors unearthed serious irregularities in expenditures. The Pakistan federal government had committed that the AGP office would perform the ex-post audit of procurements of COVID-related supplies and social payments by the end of April, and the AGP department conducted the audit, reported The Express Tribune. However, a day before the expiry of the deadline for finalisation of the audit report, Pakistan's Ministry of Finance sought more to clarify its position and requrested not to print the report as of now, informed a top official of the AGP department.
This comes after the IMF Executive Board had approved a host of new conditions that Pakistan would have to implement for qualifying for the next loan tranche. Prime Minister Imran Khan's government had committed to "timely publication of awarded contracts and beneficial ownership information of bidding and awarded legal persons on a centralised and publicly accessible website of the Public Procurement Regulatory Agency by end-April 2021, along with an ex-post audit by the AGP of COVID-related supplies and social payments. The results of the audit report, under the deal, was to be published on the website by the country's Finance Ministry by the end of April, which has now been violated by the ruling government, reported The Express Tribune. The Pakistan government will now have to seek a waiver from the IMF. AGP department officials said that the auditors had found serious violations of procurement rules and regulations and instances of poor management of Khan's Rs 1.24 trillion relief package.
The irregular payments were also made to spouses of government employees under the Benazir Income Support Programme (BISP), they added. A senior AGP department official said that the draft report was shared with the Ministry of Industries and Production, Ministry of Health and other departments to seek their views on the matter. According to The Express Tribune, the official said that the department had written to the Ministry of Finance to hold a meeting this month aimed at finalising the special audit report. According to a summary prepared for the Economic Coordination Committee and a UK-funded report, actual spending of the Prime Minister's relief package has remained very low. Khan had announced the stimulus package in March last year aimed at supporting the economy to absorb the adverse impact of the pandemic. His government had allocated Rs 875 billion in cash expenditures, i.e, areas with impact on fiscal balance from which Rs 330 billion had been utilised or was in the process [of being utilised], which was equal to 38 per cent of the cash package, according to the report.
However, the UK-based report showed that actual spending remained at only Rs 297 billion - 34 per cent. The IMF had allowed the government to enhance COVID-19 related spending by about Rs 200 billion but yet the government could not fully avail this window, reported The Express Tribune. Imran Khan and Finance Minister Shaukat Tarin have termed the IMF conditions unimplementable in the prevailing circumstance. On the other hand, an IMF spokesperson indicated that any such discussion would take place only at the time of the next review, which is after the budget. Sources informed that despite making an announcement to renegotiate the IMF programme, no formal discussions have taken place between Pakistan and the senior IMF staff to renegotiate the programme before the presentation of the next budget.
