MoC found responsible for Rs9.47bn malfeasance

ISLAMABAD: The Ministry of Commerce has been found responsible for financial irregularities and mismanagement amounting to Rs. 9.47 billion during the financial year 2023–24. 

The Audit Report 2024–25, which reviewed expenditures across various departments and attached organizations under the ministry, highlighted serious breaches of financial discipline, unauthorized spending, and non-compliance with procurement and administrative regulations.

Among the most critical issues was an unauthorized payment of Rs. 1.1 billion by the Trading Corporation of Pakistan (TCP) during urea procurement operations. The audit noted that TCP bypassed the mandatory competitive bidding process in violation of Public Procurement Rules, thereby undermining transparency and causing loss to the public exchequer.

The deal was executed on a government-to-government basis without exploring the open market, despite ample time and capacity to conduct fair competition.

Another major observation involved the non-recovery of Rs. 3.1 billion in outstanding dues from various defaulters by the Export Development Fund (EDF) and other commerce-affiliated entities. Despite repeated audit queries and internal reminders, no serious effort was made to initiate recovery, suggesting a systemic lapse in enforcement mechanisms within the Ministry’s administrative apparatus.

In a similar vein, the Pakistan Horticulture Development and Export Company (PHDEC) came under fire for irregular expenditures exceeding Rs. 250 million.

The company was found to have hired consultants without competitive tendering, diverted development funds for administrative expenses, and made several payments without adequate supporting documentation.

These practices directly contravened established financial controls and raised questions about transparency in project implementation.

The Trade Development Authority of Pakistan (TDAP) was also found to have incurred Rs. 96 million in irregular expenses on international exhibitions and promotional events.

The audit noted that no performance evaluations or impact assessments were conducted to justify these expenses, and in several cases, payments were made without obtaining completion certificates or verifiable deliverables.

Further scrutiny revealed that Rs. 110 million were spent on foreign delegations and promotional tours without obtaining approvals from competent authorities. These expenditures were often booked as operational costs without strategic justification, and in many cases lacked post-activity reports or assessments of trade impact, indicating misuse of public funds under the guise of export promotion.

In addition to these high-value irregularities, the audit report flagged numerous internal control weaknesses across the Ministry and its associated organizations.

These included duplicate payments, poor recordkeeping, unreconciled accounts, and failure to produce complete documentation during the audit process.

Such systemic issues not only hamper transparency but also obstruct proper evaluation of financial health and program outcomes.

The Auditor-General recommended that the Ministry of Commerce launch internal inquiries into all major irregularities, recover outstanding dues from responsible parties, and hold accountable those officials who violated rules or failed to act in time.

It further advised the Ministry to overhaul its internal audit systems, ensure regular reconciliation of accounts, and strictly enforce procurement rules to prevent future losses.

Despite the gravity of the findings, the Ministry of Commerce has not yet responded to the audit observations.—NUZHAT NAZAR