PAC declares SLIC, NILC ‘white elephant’

ISLAMABAD: The Auditor General of Pakistan declared State Life Insurance (SLIC) as a “white elephant’ while revealing to the Public Accounts committee (PAC) that annual administrative expenditure of SLIC was over Rs6.5 billion against its output of only Rs5.2 billion.

The PAC expressed its dissatisfaction with the briefings of Pakistan State Life Insurance and National Insurance Company Limited (NILC) given to the committee and questioned as to how the entities showing profit for the last 30 years had nosedived into losses.

The PAC held its meeting on Thursday under its Chairman Syed Khursheed Shah in which the SLIC and NICL gave a briefing on their 10-year performance to the committee.

During the meeting, Auditor General of Pakistan Rana Assad Amin requested the committee to ask SLIC to give details of their expenditure as it had become a white elephant.The officials of State Life Insurance replied that that their annual administrative expenditure was Rs6.5 billion.

Chairman SLIC told the committee that the Prime Minister’s National Health Insurance scheme was being implemented through State Life Insurance.Chairman PAC Syed Khursheed Shah questioned as to who had pointed out that hospitals and districts under the scheme and the smaller provinces were being deprived of benefits under this scheme.

The officials of the SLIC told that provinces were selecting the hospitals and districts and the decision in this regard was not made by State Life Insurance and Ministry of National Health Services.

The PAC asked about the reasons of the losses suffered by SLIC which was in profit till the financial year 2012-13.The officials of SLIC gave a reason of slow down of agricultural growth in South Punjab was a main reason of going into losses.

The PAC rejected their reply saying: “There was no link between State Life insurance and lower growth in agriculture sector. Give us reason which could have any justification and it seems that you come in the meeting without doing any homework, which is indication of non-serious attitude towards the committee,” the committee members remarked.

The PAC directed for a detailed report of losses of the SLIC to the committee by January 30, next year.While briefing the committee, the Chairman National Insurance Company Limited (NICL) told the PAC that its administrative expenditure were Rs809 million in 2009 and now these had increased to Rs1.77 billion.

He gave reasons of financial irregularities and purchasing of unnecessary property for the increase in the expenditure. “The administrative expenditure has now come down to Rs881 million,” he told the committee.

However, the officials of NICL failed to respond to the question of PAC member Syed Naveed Qamar, who asked the reasons of massive decline in the administrive expenditure of the NICL in one year.The committee sought the complete report from the NICL in next meeting.