Questionable Arithmetic by the Lead Auditor or a Genuine Billion-Dollar Explosion?

The Auditor General of Pakistan has presented a shocking report on the federal finances, revealing irregularities worth an astounding Rs375 trillion. This figure surpasses the total budget amount and has raised eyebrows in the government and beyond.

The Auditor General's office has pointed out various violations, embezzlement, weak internal controls, poor asset management, contract mishandling, and encroached government land as the primary causes of these irregularities.

The report, which is ready to be presented before parliament, does not provide a clear explanation for how these irregularities could reach such astronomical figures. It states that Rs284.17 trillion is tied to procurement-related issues, while Rs85.6 trillion was wasted on defective, delayed, or unexecuted civil works.

Moreover, the report highlights a difference between allocation and expenditure of only Rs370 billion, yet the irregularities are reported to be worth Rs375 trillion. This discrepancy is further complicated by the fact that Rs1.2 trillion is unresolved circular debt and Rs2.5 trillion is stuck in receivables and recoveries.

The report also sheds light on the Rs14.5 trillion federal budget for FY2023-24, with the appropriation accounts showing a final allocation of Rs40.3 trillion and actual expenditure of Rs39.9 trillion. However, these figures do not adequately explain the vast irregularities uncovered.

The Auditor General's office was not surprised by the alarmingly high figures of irregularities. The report, published in The News, raises more questions than it answers for many, including those in the government.

The report's publication suggests a potential collapse in the financial oversight system where numbers no longer correspond to reality. The total GDP of Pakistan is around Rs110 trillion, making the reported irregularities exceed Pakistan's GDP and budget figures.

In a voice note shared by the Spokesman for the Auditor General's office, it is indicated that these irregularities could surpass the total budget amount, further emphasising the gravity of the situation.

As the report awaits parliamentary scrutiny, it remains to be seen how the government will address these alarming findings and restore confidence in the financial management system.