Transparency questions arise in Daanish Schools project

Reports of gross violations of rules with alleged corruption have surfaced in the construction of the multi-million rupee Daanish Schools project with senior bureaucrats putting their full force behind covering up the deeds of their retired colleague, Pakistan Today has learnt.

Sources privy to the development revealed that the Punjab auditors had pointed out severe violations of rules in execution of Daanish Schools Project under former managing director Yousuf Kamal. They maintained that Kamal allegedly ran the entire project on his whims and in complete violation of the Punjab Procurement Regulatory Authority (PPRA) rules with auditors observing “poor construction” on “much higher rates” than what the rules allowed. They further revealed that a high-level meeting was also held on Friday at the chief minister’s secretariat on the same issue, where it was decided to “clear up” past mistakes and continue the project under rules and regulations.

According to rules for a tender below Rs 200 million, only 4.5 percent higher than the approved government rates can be approved, while for mega projects involving more than Rs 200 million, the ceiling is 9.5 percent. However, the sources said the authorities had approved higher rates ranging from 6 percent to even 18 percent for the contractors of their choice, which the auditors have termed the “gravest” violation of set rules.

They further alleged that all contracts were awarded under the former managing director’s tenure who did not even bother to form a PC-I—a prerequisite for initiating any government scheme, while the funds were transferred directly into commercial accounts of concerned DCOs who released them after getting a nod from the authorities without following any formal procedure.

They further maintained that no competitive bidding was ensured as is set under the rules in awarding of contracts, while the rules demand inviting contractors for bidding every year, the authorities selected the contractors at the start and then continued with them for reasons best known to them.

Daanish School incumbent Managing Director Sajid Hasan maintained that the entire mode of financing was “grant-in-aid” which does not require PC-I or other administrative and technical approval.

“The auditors are of the view that it should have been made under Development Financing Mode which requires approval from the competent forum and following of set down procedure. The government had given a nine-month deadline and hence a few procedures were missed to expedited work,” he added.

The matter came to public attention when a group of contractors who worked on the Daanish Schools project came out protesting and demanded payments of their outstanding dues. Sources revealed that the concerned district coordination officers (DCOs) and the former MD have been releasing funds to these contractors at their will, something which came to light when the Punjab government auditors called “gross violations”. This led the authorities to stop any further funds which sources said was tantamount to catching the “tail and leaving the elephant”.

So far, the government has spent more than Rs six billion since 2008 on one of the most ambitious project of the Punjab government. The government set up a separate authority and gave then PVTC Chairman Yousaf Kamal additional charge as managing director of the newly established authority in May 2009. A finance department notification further clarified that the MD had powers equal to an administrative secretary.

Sources alleged that the powers exercised by the former MD were beyond those even an administrative secretary was entitled to.

“Even if the project was run under grant-in-aid mode, it was nonetheless public money which could be spent only through a set procedure and not on the whims of a few officers,” they said, adding that the DCOs were empowered to approve schemes up till Rs 100 million while that of a secretary was Rs 200 million with all spending needed to be approved by a proper forum, something which had been completely ignored in completion of Daanish Schools Project.

Sources further said once the audit objections were raised the matter was sent to Schools Education Secretary Aslam Kamboh, who after addressing a few objections, sent the rest for publications. “A pile of objections is lying with the concerned departments,” a source said.

Another senior official said the chief secretary had sent a probe committee to one of the districts after receiving complaints of severe violations, but the DCO concerned refused to share the data, allegedly on the orders of the son of a senior politician.

MD Sajid Hassan further maintained that a meeting was held on Friday on the same issue to look into the matter and things had been “sorted out.” To another question, he said the tenders were advertised and rules followed, but he could not justify the existence of audit objections in that case.

Another senior official on the condition of anonymity said the incumbent MD prepared all rules and had been going by the book in the execution of the project, unlike his predecessor.

Talking to Pakistan Today, former MD Yousaf Kamal said it was because of the “financial constraints” that the government had not been able to pay the contractors.

“The government probably spent it on projects of their own priority,” he said.

Responding to a question, he said if an auditor pointed out some shortcomings, the departmental audit committee looks into it and files response as per routine procedure.