Amid a countrywide hue and cry over scrapping of the National Commission for Human Development (NCHD), a special audit report on the commission claims that the NCHD could not achieve its objectives apart from exposing cases of imprudent financial spending by former senior officials of the commission. The NCHD was established on July 9, 2002 through Ordinance No XXIX of 2002, as a federal statutory body attached with the Cabinet Division, but the government had recently decided in the Council of Common Interest to disband the body, as both the federal and provincial governments had refused to own the programme.
There is also no allocation of funds for the commission in the budget 2011-12. The objective of the NCHD was to promote human development by supporting government departments, non-governmental organisations and public representatives at the district level in primary education, literacy, income-generating activities and basic health care services. To finance the operations of the NCHD on a sustainable basis, the government incorporated the Pakistan Human Development Fund (PHDF) with the exclusive responsibility to raise funds for the NCHD.
In essence, PHDF was the pool of funds received from donors, including the government, which provided funds to the NCHD for its operations and programmes. Initially, the government committed to contribute Rs 2 billion to PHDF for the NCHD to make it sustainable, however, PHDF could not achieve sustainability and managed to raise approximately $5.8 million against its commitment to raise $15 million during the first three years of its operations. The government had to fund NCHD to keep it going and avoid disruption of its activities, providing around Rs 6.25 billion to the commission from 2202-03 to 2006-07.
Audit findings suggested that the NCHD became dependent on government grants contrary to the original design of raising funds from international and national donors. “The NCHD was established on the premise of sustainability with a planned government contribution of Rs 2 billion. However, the grants provided to the PHDF by the government during the span of six years amounted to Rs 6.25 billion. This was 74.43 percent of total funds received for the NCHD,” the report said, adding that the funds were released to PHDF without involving the Planning Commission.
The report said in some cases, expenditure was not incurred economically.
“PHDF engaged two lobbying firms of the US Congress for Rs 30 million with an aim to raise $4 million for the NCHD. However, the lobbying firms raised nothing and the expenditure was wasted. The NCHD lost Rs 8.66 million in organising a stage drama Anarkali in the US for fund raising. In addition, the NCHD had to pay Rs 1 million as legal expenses to contest a claim of Rs 10 million for violation of intellectual property rights,” the report pointed out. It added that the principle of financial propriety was not observed, as the government’s prescribed entitlement for air travel was violated by the NCHD while attending a board meeting in Dubai on February 15-16, 2008, which involved an extra expenditure of Rs 280,525.
“Expenditure of Rs 506.6 million was incurred on procurement of assets which did not directly benefit the concerned line departments as envisaged in the NCHD Ordinance and the Presidents’ decision. NCHD’s expenditure on communication and mass awareness increased by over 254 percent from 2006 to 2007,” the report said.
The federal audit authorities pointed out that on the whole, the NCHD could not achieve its objectives, though they did note some success stories.
“Though audit noted some isolated success stories resulting from NCHD operations, on the whole the commission could not be termed compliant with its mandate. The NCHD did not support government line departments, non-governmental organisations and public representatives at the district level as envisaged in the ordinance. Audit noted that the NCHD engaged in provision of services directly, contrary to its mandate,” the report said.
“Since the funds were not channelled through proper budgetary procedures and the advisory council representing critical stakeholders did not provide much-needed interface between the NCHD operations and other development organs of the state, audit noted instances of duplication in development activities.”