HBFC has become bankrupt on account of low recovery of loans: minister

ISLAMABAD: Minister if State on Finance Rana Muhammad Afzal on Thursday said that the House Building Finance Corporation (HBFC) had almost become bankrupt owing to very much low recovery of disbursed loans from the borrowers.

Speaking at a meeting of the Senate Standing Committee on Finance chaired by Senator Saleem Mandviwalla here on Thursday, Minister of State for Finance Rana Muhammad Afzal said that in other countries HBFC-like institutions had developed cities, while in Pakistan it is near to death because the borrowers are not repaying loans to it. Rana made these remarks during discussion by the committee on loans write-off scheme announced by former Finance Minister Ishaq Dar in budget speech 2017-18.

Finance Division has approved half a billion rupees for providing “relief to widow borrowers of HBFC” to write off their outstanding loans, officials informed the committee. A detailed plan was submitted to the meeting that was to be implemented by March 2018, but some members were not agree with the plan saying that due to tedious progress with respect to identification of beneficiaries, the plan’s implementation in time was not possible.

Secretary Finance Arif Ahmed Khan while talking on separation of cadres of accounts and audit in line with the summary approved by the prime minister, he said Finance Division forwarded matter to the Establishment Division and assured the committee that he will pursue the matter in line with the directives of the committee. The minister said that separation of these two institutions is vital for better working and performance.

In Federally Administered Tribal Areas (Fata) over 650 post are lying vacant in schools. Senator Hidayat Ullah, being the special invitee in the committee informed the committee that around 1400 ghost employees are drawing salaries from schools and hospitals in Fata.

Chairman of the Committee Saleem Mandviwala stated that two issues, including legislation regarding federal consolidated fund and public accounts have been pending for long time with no progress from Finance Division. Secretary Finance replied that work on them has been completed and report has been submitted to the Adviser.

Saleem Mandviwalla stated, “These two matters are constitutional requirement and he does not see any problem for finance minister to implement them. This is something mentioned in the Constitution but not being done.”