ISLAMABAD, Feb 20: The Central Directorate of National Savings (CDNS) is likely to cancel the agency functions of Pakistan Post Office as it has failed to ensure timely auditing and stock reconciling of accounts.
Informed sources told Dawn on Tuesday that the issue had been brought to the notice of the officials of the ministry of finance last week at a high-level meeting presided over by Secretary General Finance Naveed Ahsan.
The meeting was told that Pakistan Post Office was not following the directives of the State Bank of Pakistan (SBP) and the Auditor General (AG) of Pakistan about auditing and stock reconciling of accounts related to CDNS.
Sources said that despite warnings given by the CDNS, the Post Office continued to flout the instructions of the directorate for selling its various saving schemes.
The Post Office, sources said, was collecting money on behalf of the CDNS and showing it as its own (P.O) revenue. "And that’s why the CDNS is going to stop the agency functions of Pakistan Post Office after having waited for 5-6 years," a source said adding that sufficient time was given to the post Office to settle issues, which were lingering for so long.
Even the prime minister, sources said, had directed the officials of Pakistan Post Office to settle its dispute with CDNS over auditing and stock reconciling of accounts.
Sources said that the Post Office was given agency functions like that of the commercial banks but it could not deliver. "There is a total mismanagement in the organisation, which is also collecting utility bills but here too it has failed to transfer funds to the concerned organisations and companies in time", another source said.
"The money received by Pakistan Post Office is being used in its saving account on which it is charging certain interest rate and this is how they are getting themselves involved in an illegal business", he said.
Sources said that the CDNS might issue "blank stock of supply" to Pakistan Post Office until the time it decided to reconcile its, what was termed, a defective auditing system.
The CDNS, whose deposit have reached Rs1 trillion plus against the total of banks' Rs2.4 trillion deposits, wanted to consolidate its business by improving its agency functions being performed by the banks and Pakistan Office.
Sources said that the last week meeting also discussed problems in converting CDNS into Pakistan Savings for which Prime Minister Shaukat Aziz has already given his approval.
It was decided that the concerned officials of the ministry of finance will accelerate the process of converting CDNS into an autonomous Pakistan Savings so that it could increase the salaries of its people and enhance its operations.
With the increase in the profit on PIB bonds, sources said, the CDNS was also planning to offer additional average one per cent profit on all its products in order to provide some comfort to its depositors.
The issue was also discussed during the meeting for which the CDNS had sent a formal proposal to the ministry of finance for approval. However, the banks were reportedly opposing the move. Interestingly, while the central bank is allowing the commercial banks to charge unchecked profit, it is said to be reluctant to allow government securities to extend increased rate of interest to their depositors. Banks have told the officials of the central bank that it would disturb the market trend if the CDNS was allowed to revise its interest rate upward.
An official suggested that the central bank should convene a meeting of the banks and other government securities including the CDNS to discuss their rates of profit for next two years, five years or even for the ten years.