LAHORE, Jan 6: Non-payment of interest-free loans by over 85 per cent beneficiaries had compelled the Punjab Baitul Maal to discontinue loan releases in March, 2003.

Punjab Baitul Maal Minister Mohammad Ijaz Shafi said this during the first meeting of the Baitul Maal Council held at the Directorate of the Social Welfare, Women Development and Baitul Maal here on Tuesday with its amin, Justice Akhtar Hasan (retired), in the chair.

The minister said Rs60 million had not been repaid out of Rs70 million interest-free loans of Rs5,000 to Rs20,000 each released for starting small-scale business as these were not properly secured.

He said recoveries through litigation could cost up to Rs10,000 per loan. The Baitul Maal had to decide about discontinuing the advancing of loans for good or secure the same like NGOs for ensuring cent per cent recoveries, he said.

He said the funds provided to the Baitul Maal by the provincial government were hardly sufficient to meet the requirements of the deserving people in 34 districts. Not more than 120 people could benefit from the share received by a district from the provincial grant.

He said over Rs30 million were lying unutilized as certain things had not been done during the past 10 years. He said the council should consider establishment of vocational institutions for providing employment to widows as Rs2,000 or Rs3,000 being doled out to each of them for their rehabilitation were being wasted.

Baitul Maal secretary Haroon Rashid said over Rs350 million of the Pakistan Baitul Maal had remained unspent despite unlimited poverty and sickness. He said the financial assistance being provided by the Punjab Baitul Maal had lost significance because only a paltry sum of Rs1,000 was being doled out to a deserving person after six months.

He proposed creation of a revolving fund for the Baitul Maal by starting schemes for rehabilitation of the deserving people benefiting from its assistance to enable them to pay back the money provided to them for use by others. He said the Pakistan Baitul Maal should be approached for using the infrastructure of the provincial Baitul Maal for providing assistance to the needy.

Justice Akhtar Hasan (retired) said the provincial government was the only source from which the Baitul Maal had been receiving funds since its establishment in 1991. The receipts from the provincial government had reduced from the initial Rs160 million per annum to Rs50 million per annum during the past four to five years.

He said Rs40 million meant for utilization through NGOs were lying unutilized because a majority of these were fake and had been created only for misappropriation of funds. The Baitul Maal Council would pay attention to utilization of the unspent amount, he said.

Punjab Social Welfare director-general Mazhar Ali Khan said the Pakistan Baitul Maal received Rs600 million to Rs700 million, but the Punjab Baitul Maal was starved from funds. The Baitul Maal not only planned to contact the international Islamic bodies for assistance, but had also sent a summary to the Punjab Finance Department for increase in the provincial government assistance.

Finance department representative Wajihullah Kundi said the department had not rejected the Baitul Maal summary, but sought details of utilization of financial assistance, unspent amount lying in its bank accounts and the profit being earned on it.

He said the finance department was not satisfied with the utilization of funds by the Baitul Maal. He said the Baitul Maal should not rely only on the assistance provided to it by the provincial government regularly, but also explore other venues like international Islamic organizations.

The council was informed during a briefing that Rs40 million meant for utilization through NGOs were lying unspent. The Baitul Maal had a bank balance of Rs150 million as well.