ISLAMABAD: The Auditor General of Pakistan (AGP) has raised objections to the Drug Regulatory Authority of Pakistan’s (Drap) renting an office building and declared the payment of Rs298 million to be doubtful, irregular and unauthorised.
The audit observed that the building was rented without observing the scales of office accommodation fixed by the Ministry of Housing and Works, the rent and area assessment was not obtained from the Public Works Department (PWD), the building was rented at a price higher than the government rates and a significant sum of money was spent on renovating the building.
The health sector became a provincial subject following the passage of the 18th Amendment, making the Drug Registration Board defunct. The board was established again under the Drap Act 2012, after which the authority began working in various offices including some in the C Block of the Pakistan Secretariat, where only ministries are permitted to have their offices, as well as a rented building in Blue Area.
Payment of Rs298m deemed doubtful, irregular and unauthorised in audit report for 2015-18 period
The Drap management was under pressure to vacate the buildings, and in early 2013 it was decided that a new building should be rented to move all the offices to one place. A 30,000 square feet building was rented for Rs4.6 million a month in G-9.
The cost of rent led to criticism, after which then minister of national health services (NHS) Saira Afzal Tarar announced in July 2014 that the process to acquire 20 kanals for a Drap building had begun. Drap was supposed to move to the new building within two years, but its offices have not been constructed for the last five years.
Drap’s audit showed that a number of violations took place in the renting of the building. The report for the 2015 to 2018 period, available with Dawn, stated that according to the Finance Division it is necessary to obtain a statement of space entitlement and assessment certificates issued by PWD.
“The Ministry of Housing and Works fixed the rent at Rs30 per square ft for Islamabad and allowed 25pc extra rent for high rise and centrally air conditioned buildings at all cities. The management of Drap made an advertisement newspaper for hiring the building for office and a three-year agreement for hiring 30,021 square ft office accommodationat Rs155 per square ft, in TF Complex, G-9/4 was made on July 25, 2014. The monthly rent was Rs4.65 million and every year it had to be increased by 10pc,” it said.
The report added: “After the expiry of three year contract, another one year contract @ Rs 187 was made w.e.f. 20th August 2017. An amount of Rs252 million was paid as rent from 2014-18. Moreover another amount of Rs43 million was paid for renovation of building. Another amount of Rs10 million was spent on purchase of furniture.”
The report said the building was rented without observing the housing and works ministry’s scales of office accommodation. In addition, a rent and area assessment certificate was not obtained from PWD to rent office accommodation, which was rented for Rs155 per sq ft, in violation of the Housing and Works Division’s rules.
A significant amount of money was spent on renovating and procuring furniture without justification, the report added. Renovations began a year after the building was rented and continued for two years.
The payment of hiring office accommodation for both periods was doubtful, the report said, and the renting the building and spending heavily on renovations was irregular and unauthorised.
The AGP also claimed that Drap’s management did not respond on this matter and recommended that responsibility be fixed for the irregularities and the expenditure regularised by obtaining post facto approval from the Finance Division.
Drap CEO Dr Asim Rauf told Dawn he was not aware of the issue because the former management that made the agreements and released funding.
He said the authority will give an appropriate response to parliament’s Public Accounts Committee.
Published in Dawn, October 14th, 2019