ISLAMABAD, Nov 20: The MMA government has deprived the NWFP of Rs444.5 billion in Wapda arrears because of its failure to properly present the province’s case before an adjudicating tribunal, according to a leader of the Awami National Party.

He said that the province suffered a loss of Rs187.5 billion after the MMA government renounced its claim for arrears from between 1973 and 1992 due under Article 2(2) of the terms of reference and more than Rs256.9 billion for not demanding the mark up rate on the arrears.

Former provincial finance minister Haji Mohammad Adeel told Dawn that the figures were based on data he had access to during his tenure as the chairman of one of the committee constituted for the recovery of net hydel profit in 1997.

Mr Adeel said the MMA government had abandoned its claim for arrears contending that the matter would be taken up later. He termed the move ironical and said that the move had come after the Council of Common Interests (CCI) in its meeting held on February 2, 1991 had finalised a method of calculating the net profits.

In 1986, the National Finance Commission (NFC) had constituted a committee under A.G.N. Qazi to determine the rate of the hydel net profit. After thorough deliberations, the committee had come up with a formula for determining the net profit, later popularly called the A.G.N. Qazi Formula, which should have been adopted for past and future calculations. The CCI, he said, had approved the formula on Jan 12, 1991.

Haji Adeel, who provided the information to a Islamabad-based German non-governmental organisation (NGO), in which he claimed that Abdul Hafeez Pirzada, the counsel for the NWFP government before the tribunal had deviated from the formula by agreeing to a 10 per cent increase in benchmark from 1990-91.

He said that the move deviated from the federal government’s decision in which it had agreed in the NFC Award announced in 1996 that in the absence of the worked out arrears, the net hydel profit payable to the province should increase at a rate of 11 per cent annually.

He said the counsel had presented the estimate before the tribunal with a 10 per cent increase on net hydel profit. The tribunal had readily accepted the plea for counting the rate of increase in net hydel profits but it set 1991-92 as the benchmark instead of 1990-91. The tribunal ruled that the province should be paid Rs110 billion over five years in instalments against the original demand of Rs227.331 billion, he said, adding that at the time, two nominees of the provincial government had ‘very graciously’ accepted the figure.

Mr Adeel claimed that the MMA government had also failed to claim arrears in the terms of reference on two other accounts. First, after the abolition of the ‘One-Unit Scheme’, Wapda used to pay four per cent of its hydel revenue to the federal government. Later, the CCI had ruled that the amount should be paid to the provinces. Before the ‘One-Unit’, the NWFP had constructed hydel stations at Jaban, Dargai in Malakand, Chitral, Kurram Garhi in Bannu and Warsak in Peshawar district.

Similarly, the learned counsel for the provincial government had claimed 10 percent increase in the net profits on the basis of increase in per unit charge of electricity, he said and added the counsel did not mention the installation of four new production units at Tarbela hydor-power station during 1992 to 1994-95. Thus the NWFP will not get now, and in future, any profit from the electricity produced in these additional production units, he said.

He questioned the claim of the MMA government that Wapda will pay Rs23.911 billion for FY2004-05, with an annual increase of ten percent. It seems, though, that the MMA authorities in the province have not gone through the award of the tribunal very carefully.

The tribunal award, in its ‘Operational Part of the Award’ on page 87 nowhere mentions that WAPDA will pay the amount beyond June 2005.

Mr Manzoor A. Sheikh, representative of Wapda before the Tribunal, in his detailed dissenting opinion, has only agreed to only the "Operational Part of the Award" because it did not mention payment of net profits after 2005-06.