ISLAMABAD: Pakistan’s largest financial institution with over Rs3.4 trillion portfolio, the state-run National Savings, has been without a regular head for more than two-and-a-half years and continues to operate on an ad hoc basis.

Finance ministry officials told Dawn that the post had fallen vacant on September 1, 2018 when its director general Zafar Masood, who had been hired by the previous government from the private sector, was shown the door. Since then, it has been looked after by junior officers or outsiders on an acting charge basis.

On Mr Masood’s exit, the Ministry of Finance had given the “look after charge” of the grade-21 position to Mohammad Khalil, a grade-20 officer, initially for three months. Officials said the acting charge for three months was approved by Prime Minister Imran Khan, who also approved its extension for three more months till March 2019.

But the finance ministry gave the “look after charge” to Mr Khalil for an indefinite period till the appointment of another director general of Central Directorate of National Savings (CDNS). “As a result, a huge national department is running on a casual basis for the last two years and a half,” said a senior official, adding the private sector would never leave such a top position of their financial institutions without a professional head even for a day.

The official said it was strange in the first place to have a grade-21 post for an institution, whose counterparts in the private sector were top class professionals with remuneration up to tens of millions of rupees a month, and yet the post remained vacant for years in the organisation that supported the country’s budget with public savings. Also, there were several grade-21officers who could be appointed on a simple salary from the federal government, the official added.

Another finance official said the ministry besides giving the ‘look after charge’ also advertised the National Savings DG position for selection on merit but the incumbent challenged the process in court and secured a status quo that would be reaching superannuation on April 30.

This is not the first time that the state-run financial institution is being run on a casual basis, as after the retirement of then director general Zafar Shaikh in October 2013 the position had been given to a 19-grade officer, Rana Saeed, on the same ‘look after charge’ until his retirement in January 2015. Later, the finance ministry instead of appointing grade-21 officer to the position gave the ‘look after charge’ to joint secretary (budget) in addition to his work despite the pressing nature of his original responsibilities.

Since the National Savings has a huge network and remains confronted with violations of rules amid complaints regarding monopoly of a few, the ad hoc arrangement did not work, with the result that customers’ service worsened. Some customers took the matter to court and compelled the finance ministry to withdraw the ‘look after charge’ from the then joint secretary budget in June 2016.

Officials said the post of DG savings required a tough administrator to end the monopoly of a few officers who kept most of its branches and offices in private buildings across the country at large drain on public money through rentals.

The state-run organisation needs a complete revamp that only an energetic, regular and capable professional can deliver, but the authorities are preparing to give yet another ‘look after charge’ to a junior officer after the retirement of the incumbent.

The CDNS boasts itself of not only to have been successful in promoting financial savings in the economy but has also generated requisite funds for the government to finance the budgetary deficit and infrastructure projects. As a custodian of the nation’s savings, “today the National Savings is the largest investment and financial institution in Pakistan with a portfolio of over Rs. 3.4 trillion and more than seven million investors” being served through 376 branches, 12 regional directors and four regional directorates of national savings.

The organisation as it stands today is one of the primeval institutions in the country with a legacy of more than 140 years that came into existence with the promulgation of Government Savings Bank Act in 1873, according to its website. The British government had used this channel to raise funds to meet war-related expenditures during the World Wars I and II.

Given the effectiveness and net benefits of these initiatives, the idea of institutionalising the savings culture was materialised by setting up a National Savings Bureau (NSB) in 1943-44 as an attached department of the undivided Government of India. Since acquiring independence in 1947, this organisation remained operational in Pakistan in various forms. In 1953, the bureau was renamed as Central Directorate of National Savings (CDNS) with same functions and responsibilities.

In September 1960, it was decided to rejuvenate CDNS structure by granting it the status of an attached department of the Ministry of Finance with the powers to formulate policies and execute various national saving schemes. “These continuous advancements made it essential for the government to reposition the CDNS as a technical department and conferring all powers of a head of the department to the Director General (DG) working in BPS-21,” says the website.

Published in Dawn, April 26th, 2021