Islamabad: The Senate Standing Committee on Finance and Revenue turned down on Thursday the draft Credit Bureau Bill, 2015, ordered a probe into a botched attempt for the sale of Heavy Electrical Complex and summoned the National Accountability Bureau over investigation into privatisation of the Muslim Commercial Bank.
A meeting of the committee, presided over by Salim H. Mandviwala, directed the ministry of finance and the State Bank of Pakistan to resolve the issue of payments to a fresh consultancy firm that had provided services to a state-run firm, but did not get paid.
The committee was almost unanimous that the draft Credit Bureau Bill proposed by the SBP and consequent formation of Credit Information Bureau (CIB) was unacceptable in its current shape as repeated assurances by Governor Ashraf Mehmood Wathra and Finance Secretary Waqar Masood could not satisfy parliamentarians that the law would not be used for political victimisation.
The meeting, therefore, decided to return the bill, along with proposed amendments to the draft law, to the Senate for discussion as a majority of the senators called for strengthening the SBP and its independence and creating another department within the ambit of the regulator to look after the affairs of credit bureaus.
The finance secretary and the SBP governor requested the committee to clear the bill, otherwise it would lapse in the next few days and the entire process would have to be initiated afresh. But members of the committee were not ready to approve what they termed a faulty piece of legislation that was going to affect rights of millions of people just because to ease workload of a few bureaucrats without satisfying their collective wisdom.
Mr Mandviwala said the committee had suggested some amendments and if the government was ready to accept them and bring an amended draft, it would be ready to approve the bill within the deadline.
After discussing the proposed amendments with his legal team, the SBP governor said he would not accept one amendment because it would negate the entire process. “We will not agree to the amendment that the SBP should verify each report of the CIB” which would be set up in the private sector after approval of the proposed law because it would require establishment of another supra body.
Mr Wathra said out of 126 countries having credit bureaus, CIBs were operating only in four countries in the public sector.
The finance secretary also requested the committee to approve the bill without any amendment as any change at this stage would require reprocessing the law, which has already been approved by the National Assembly.
Kamil Ali Agha said that the committee should reject the bill if the government was not ready to accept amendments proposed by the senators. All other members of the committee agreed.
Another member said that the bill involved political elements and could be used for political victimisation. He also questioned the need for giving CIBs to the private sector. Mr Mandviwala said that no-one was in favour of passing the bill in its current form.
The committee constituted a sub-committee, headed by Mohsin Leghari, to thoroughly investigate the privatisation transaction of the HEC because members of the committee were not satisfied with the explanation given by the chairman of the Privatisation Commission, Mohammad Zubair.
The members said the company was disqualified because its cheque was dishonoured and not because of the due diligence process carried out by the privatisation commission. There must have been some serious lapses, otherwise the company that was registered after the HEC sale process was initiated should not have qualified the bidding process.
This showed that due diligence was totally bypassed and “even my drivers could have qualified”, said Mr Leghari.
Mr Zubair said that some HEC board members might have shared information with the company because it was public information after the decision of privatisation had been taken, but added that he was not privy to information-sharing.
In reply to a question, the SBP governor said there was a standard practice in various countries that the parent company made investments abroad through its subsidiaries, citing the example of HEC.
A participant said the Cargill Holdings International had disowned Cargill Pakistan, but even this did not arouse suspicious here.
The committee decided to summon the NAB after the SBP governor informed it that after the decision of the privilege committee, 39 files pertaining to the MCB’s privatisation were handed over to the accountability bureau.
But the NAB returned the files with comments that there was no decision in the minutes of the committee to investigate MCB’s privatisation, he added.
The committee deferred discussions on KASB Bank’s takeover because the matter was in court.