ISLAMABAD, April 12: An amount of Rs59 billion of the Workers Welfare Fund aimed to resolve housing problems of labourers has not been properly utilised yet, it is learnt.

The Fund, a department that functions under the ministry of labour, was established by imposing taxes on employers. The total contribution deposited with the ministry of finance under the Fund since 1971 reached Rs59.29 billion by the year 2006-07. But, so far the ministry has released only Rs24.47 billion, only 53 per cent of the total amount, for providing housing facilities to workers.

In a performance audit report submitted to the president and the Public Accounts Committee of the National Assembly, the Auditor General of Pakistan has observed that nearly half of the amount, released to the provinces between 2002-03 and 2006-07, has not been utilised.

According to the Workers Welfare Board, Rs18.9 billion had been released to provinces during this five-year period of which only Rs10.6 billion had been spent.

The total number of registered workers with the Employees Old-Age Benefit Organisation is 2.5 million. This is a conservative estimate and the actual figure is said to be much higher because a large number of workers are not registered with the organisation.

However, so far only 56,467 workers have got benefits from the project, the number is just two per cent of the total registered workers.

Since the establishment of Fund in 1971, employers are taxed on the promise that the funds would be utilised for the benefit of the labour force that include construction of houses, financing other welfare measures like education, training etc., and investment in government guarantees, non-government securities and real estate.

The audit has observed that the land acquisition process is cumbersome and contributes towards slow utilisation of funds.

The Fund has a constant stream of cash inflows through taxation. According to experts, instead of investing these funds in long term bonds, the board should develop creative projects that could be beneficial for workers at large.

The audit report says there is no mechanism in the Workers Welfare Board for ensuring that the money received in the name of the workers is remitted in its entirety to the Fund’s account. The ministry of finance uses its discretion in releasing fund to the board. This leads to uncertainty over estimates of cash flows and resultant ad-hoc planning of the utilisation of the Fund’s money.

The report says there are many instances where Fund’s money is used as a cash cow of the federal government. For example, during the audit of the accounts for the financial year 2005-06 it was noted that Rs100 million were released to Sheikh Zayed Hospital Lahore for recurring expenditure of the Kidney Centre.