ISLAMABAD: Grave observations were expressed by auditors on a ‘lopsided’ agreement to lease out four kanals in Garden Avenue near Shakarparian to a private firm.

The auditors pointed out these financial irregularities over a year ago, but PAC did not take these up for discussion in detail and practically shelved the issue.

Sources said senior authorities in the information ministry, the controlling division of Lok Virsa, tried to persuade outgoing Executive Director Dr Fouzia Saeed to extend the subcontract which was going to expire in September this year.

The agreement was signed on Sept 30, 2008, for a period of 10 years between Saeed A. Khan, the then director Lok Virsa, and Rauf Khalid from Cosmos Production.

The issue first came up before PAC over a year ago

The Lok Virsa management awarded the lease of 4,159 sq-ft land to the firm, which is owned by Senator Rubina Khalid of PPP, for setting up Museum Cafeteria on a throwaway rent of Rs31,250 per month.

The firm also occupied double than the mentioned land for parking in front of the restaurant.

However, instead of Museum Cafeteria, the leaseholder established a Chinese restaurant.

As per the audit report, not only the restaurant but the entire project of Cosmos Production, including outsourcing of the open air theatre, museum shops, cafeteria (tuck shop), museum operation, rooftop theatre, artisans-at-work festival and training workshop, was against the interest of Lok Virsa.

As per the audit report, Lok Virsa on June 25, 2004, advertised the outsourcing of the facilities.

A committee was constituted by the then executive director, headed by himself, to scrutinise the expression of interest and bids.

The committee rejected four bids and considered the offers of three others.

The executive director decided to obtain specific bids in quantitative terms for the entire package from the qualifying bidders.

Subsequently, the management awarded the work (collaboration in various joint ventures, events and programmes as well as rental facilities owned by Lok Virsa) to Cosmos on July 21, 2004, through one umbrella agreement/lease deed.

The private firm also established an educational facility namely National Institute of Cultural Studies (NICS) on Lok Virsa premises and offered programmes in different disciplines.

The audit pointed out 11 irregularities in the award of the contract according to which the approval for the agreement was not sought from the board of governors (BoG) and the then executive director, Uxi Mufti, executed the agreement on his own despite the fact that he was not competent to enter into such an agreement. No approval was obtained from the BoG regarding the contract.

The contract was signed in violation of general financial rules and no legal vetting of the contents of the agreement was carried out at any forum by the Lok Virsa management.

The auditors pointed out that the agreement did not mention any profit-sharing formula between Lok Virsa and Cosmos Production.

Instead of gaining financial benefit, Lok Virsa suffered financial loss and the private firm defaulted on millions of rupees.

The audit report concluded that “absolute favouritism was accorded to the private party”.

PAC member Shafqat Mehmood, when contacted, said that he was unaware of this audit para. He, however, said he would take up this audit objection in the next meeting.

Senator Rubina Khalid did not respond to a number of calls. However, Mr Hanif, a manager at her restaurant, claimed that there was nothing wrong in the agreements with Lok Virsa.

He also defended the low rent for the restaurant saying Cosmos’ educational venture, NICS, offered courses in hospitality programmes and the students were asked to work in the restaurant as interns. Hence the restaurant is also contributing in the field of education.

Lok Virsa’s outgoing executive director Dr Fouzia Saeed did not comment when contacted.

However, documents available with Dawn showed that the incumbent Lok Virsa management on a number of times had asked Cosmos Production to convert the Chinese restaurant into Museum Cafeteria.

Published in Dawn, February 11th, 2018