The boulevard of broken promises

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Auditor General of Pakistan has revealed that National Highway Authority (NHA) has suffered a loss of Rs 328.208 million due to deposit of revenue at lesser rate on toll plazas being illegally operated by NLC. According to audit report of 2010-11 it has been said that in June 2009 senate approved a policy that 25% toll plazas being operated by National Logistic Corporation (NLC) and Frontier Works Organization (FWO) on national highways network be auctioned to private operators and ministry of communication and National Highway Council also approved the policy. National Assembly standing committee on communication endorsed this policy of ‘award of 01 toll plazas to 01 operator, resultantly bids of 26 toll plazas were called to be opened in accordance of this policy. Audit report revealed that NHA issued letters of acceptance to highest bidders of eight toll plazas however NLC did not hand over the toll plazas to the new operators till the time of the audit and continued to deposit revenue as per the previous formula of %age of revenue basis rather than the net guranteed revenue formula (fixed monthly amount initial period of one year extendable for further one year from Aug 03 2009 to Aug 2011. Report further revealed that during Aug 2009 t0 June 2011 National Highway authority NHA suffered a loss of Rs 328.208 on toll plazas which were operated illegally by NLC. Audit maintains that less recovery was due to deficient revenue recognition policies to the rules/regulations and material weakness in internal control. The authority failed to realize due revenue in a climate of financial constraints and declining resource availability. This mismanagement was pointed out by auditor general but authority did not respond to the audit observation. The DAC in its meeting held on December 29-30-2011 directed to get toll plazas vacated from NLC with further delay.