KARACHI: The Sindh government on Thursday asked the State Bank of Pakistan and two government-run banks to unfreeze accounts pertaining to salaries and pension of all the municipalities, officials said.

They added the accounts of all the municipalities from the Karachi Metropolitan Corporation (KMC) to union councils had been frozen last week, as the authorities decided to sort out financial matters in view of the changes in the old municipal set-up.

The officials said the remaining accounts pertaining to funds for development schemes etcetera would remain frozen, as the adjustments vis-a-vis administrative changes in the municipal system in Sindh needed a few more days.

However, a KMC spokesman claimed that the bank accounts of Sindh’s only metropolitan corporation had not been revived till Thursday evening. The banks froze ‘all the accounts’ due to some misunderstanding, as the government in its previous request had not specified the salary and pension accounts, said the provincial government officials.

The finance ministry on Thursday sent a request to the SBP, the Sindh Bank Ltd, and the National Bank of Pakistan asking them to unfreeze the bank accounts of all the municipal bodies in the province regarding salary and pension.

“You are requested to henceforth unfreeze the bank accounts/ sub-accounts of local councils maintained in respective branches of Sindh Bank Ltd and the National Bank of Pakistan to the extent of payment of salary/pension only,” said the letter sent by the finance ministry on Thursday.

“The banks shall entertain only those cheques which are duly vouched / pre-audited by the concerned auditor of the Local Fund Audit Sindh with immediate effect under intimation to this department.”

Officials in the government said those accounts had been made functional, thus it would cause no delay in payment of salaries or pensions as the employees of the municipal bodies were paid after fifth of a month.

Earlier expressing his concern on the freezing of accounts, city deputy mayor Arshad Vohra said it would dearly affect the release of salaries and funds for the ongoing schemes.

Last week the finance ministry had asked for freezing of accounts/funds pertaining to the KMC, district municipal corporations, successors to the defunct town municipal administrations [municipal corporations, municipal committees], all district councils and all union administrations across Sindh.

It requested the SBP and the banks to stop all the payments against the list of bank account numbers attached with the request.

Officials in the provincial government said the bank accounts of all the newly-formed municipalities had been frozen after the government realised that the entire local government system of the province had been changed because of delimitations and radical change in the structure that was in place till February 2010.

“The KMC has revived, jurisdiction of its union committees has altered and number of such committees has increased, town committees are abolished and district municipal corporations with addition in Korangi have been restored,” said a senior official.

He added that similar radical alterations and changes in the system had been made in other districts of Sindh.

Another official had said all that had changed everything. “So far the municipalities were being run in accordance with the old bank accounts. But now when the elected councils are already in place and administrators are no longer there to run their affairs, such things were needed to be done.”

The government officials, however, conceded that the way the accounts had been frozen did not give a better posture to the Sindh government, which was already stigmatised with bad governance and searching for something good to improve its image.

The mayors and chairmen of district municipal corporations have been in the office for the past two months, while the union committees and union councils were functioning months before them.

“The government should have done such things before the municipalities were handed over to elected representatives,” said an official in the local government ministry. He said the decision was taken after the government received reports of growing anomalies vis-a-vis financial matters of many municipal bodies.

The officials said completion of the ongoing projects would be affected badly in whole Sindh if the development accounts remained frozen for a longer period.

The finance ministry officials, however, claimed that they had already finished much of the work relating to provision of funds to municipal bodies and all the accounts would be revived within a week.

Published in Dawn, November 4th, 2016