Massive Financial Irregularities Uncovered in KP Local Governments
A comprehensive audit of Khyber Pakhtunkhwa’s (KP) local governments, covering the period from 2002 to 2024, has revealed serious financial irregularities amounting to Rs354.126 billion. Despite the staggering amount of mismanagement, most of these irregularities remain unresolved. The lack of an effective mechanism for addressing audit objections has contributed to the financial oversight failure, leaving public funds vulnerable and unaccounted for.
Negligence in Recovery Efforts and Legislative Shortcomings
According to the Auditor General’s office, only Rs3.232 billion has been recovered to date, which is merely a fraction of the total amount highlighted in over two decades of audit reports. Experts attribute this failure primarily to the Pakistan Tehreek-e-Insaf (PTI) government’s inability to implement structural reforms. The PTI government failed to establish functional Tehsil Accounts Committees, which were mandated under the 2019 Amendment Act to review audit reports and ensure financial accountability at the local level.
In contrast, other provinces like Punjab, Sindh, and Balochistan have empowered their Public Accounts Committees (PACs) to regularly scrutinize local government audit reports, making KP’s lack of progress even more glaring.
Audit Reports and Lack of Oversight
Over the 22-year period, a total of 765 audit reports were issued, identifying 18,090 audit objections. These involved mismanagement, irregular expenditures, and fraudulent transactions. The reported irregularities total Rs354.126 billion, while only Rs3.232 billion has been recovered so far. This leaves an overwhelming Rs350.893 billion still pending.
Breakdown of Yearly Audit Figures and Recoveries
The audit figures show consistent financial mismanagement across multiple years:
- 2013-14: Objections worth Rs7.5 billion were raised; only Rs121.5 million recovered.
- 2014-15: Audit paras highlighted Rs3.29 billion in irregularities; Rs105.9 million recovered.
- 2015-16: Rs7.05 billion flagged; just Rs62.3 million recovered.
- 2016-17: Rs32.4 billion in irregularities; Rs280.6 million recovered.
- 2017-18: Rs31.1 billion pointed out; Rs128.9 million recovered.
- 2018-19: Rs26 billion identified; only Rs100.4 million recovered.
- 2019-20: Rs34.3 billion flagged; Rs221.2 million recovered.
- 2020-21: Rs37.1 billion in audit paras; Rs134.2 million recovered.
- 2021-22: A sharp rise with Rs52.4 billion in irregularities; a mere Rs0.57 million recovered.
- 2022-23: Rs52.6 billion flagged; Rs62.1 million recovered.
- 2023-24: Rs40.7 billion raised; Rs1.25 billion recovered.
This persistent trend of high-value objections and minimal recoveries paints a troubling picture of local government oversight in KP.
Accountability Crisis and Legislative Gaps
A senior government official emphasized that without urgent reforms in the accountability system, these issues will continue to escalate. The current legal framework provides no process for addressing audit paras before 2019, creating a backlog of unresolved issues. Additionally, the existing Public Accounts Committee lacks the jurisdiction to oversee local government audits under the 2019 Act.
The absence of accountability measures means that even if irregularities are flagged, they are unlikely to be resolved. This has led to growing concerns about transparency and public trust in the system.
Lack of Coordination Between Government and Audit Bodies
A spokesperson for the Local Government Department claimed that the provincial government had not received audit reports from the Auditor General’s office. He stated that any reports received would be forwarded to the respective Tehsil Councils, in accordance with the law. However, the lack of coordination and follow-through has only worsened the situation.
Call for Urgent Reforms and Oversight
An official from the Auditor General’s office warned that unless immediate reforms are introduced to improve transparency and enforcement, these audit objections will continue to pile up. He highlighted the systemic inefficiencies and underscored the need for a stronger financial oversight mechanism.
The failure to empower the Tehsil Accounts Committees and implement the provisions of the 2019 Amendment Act has left the province with a weak financial accountability system. Without a comprehensive reform of the existing legal and institutional framework, the problem of financial mismanagement is likely to persist and deepen.
