Rs 75 billion development funds under scrutiny as audit finds missing records at Cabinet Division

Serious financial and administrative irregularities have been pointed out in the Cabinet Division after a federal audit found

Islamabad:  Serious financial and administrative irregularities have been pointed out in the Cabinet Division after a federal audit found that the proper utilization and regional distribution of Rs 75 billion released for development projects could not be verified because the required monitoring reports, completion certificates and detailed spending records were not available.

The audit also revealed that 125 cases were recorded under noncompliance or partial compliance with earlier Public Accounts Committee (PAC) directions, raising questions about financial accountability and the implementation of parliamentary oversight recommendations.

According to the Audit Report on the Accounts of the Federal Government (Civil), the Cabinet Division released Rs 75 billion during the financial year 2024 to 2025 under the Sustainable Development Goals Achievement Programme (SAP).

The auditors observed that the Cabinet Division failed to obtain mandatory monthly progress reports and project completion certificates from the government departments and agencies responsible for implementing development schemes.

As a result, the audit authorities could not establish whether the huge amount had been distributed fairly among different provinces and regions or whether the funds had been used according to the approved programme objectives.

The Rs 75 billion worth of development schemes had been approved by the SAP Steering Committee before the funds were released to federal ministries, government divisions and provincial governments for implementation through their respective agencies.

The programme was designed to promote balanced regional development, improve public facilities and strengthen social infrastructure through smaller community development projects.

Under Paragraph 3 of the revised SAP guidelines, only those projects that contribute to human development and fair regional growth qualify for funding.

However, the auditors found that the Cabinet Division had not obtained the documents required under Paragraph IV, clauses viii and x, of the programme’s policy.

The absence of these records prevented the auditors from verifying whether the funds had reached the intended regions and whether the projects had achieved their stated objectives.

Another serious concern was the unavailability of complete information showing how much money had been allocated to individual schemes and different regions.

According to the report, the Cabinet Division did not have the consolidated project and regional spending records needed to establish whether the Rs 75 billion had been distributed in line with the programme’s purpose.

The auditors observed that SAP was intended to reduce development gaps by providing public investment to underserved areas.

However, without proper records, they could not confirm whether the allocation and utilization of funds had followed the principles of balanced regional development.

The report raised an important accountability question about how the use of such a large amount of public money could be properly monitored when the required progress reports and completion certificates had not been obtained.

The audit observation does not establish that the Rs 75 billion was stolen or misappropriated. Instead, it identifies serious weaknesses in the records and monitoring arrangements needed to verify its use.

The matter was formally reported to the Cabinet Division management on November 5, 2025.

However, according to the audit report, the management did not submit any reply before the report was finalized.

The absence of a recorded response left the auditors’ concerns about monitoring and verification of development spending unanswered.

The audit recommended that the Cabinet Division establish a centralized digital monitoring system to maintain complete information about development schemes.

The proposed system would record funds allocated and utilized for individual projects, different sectors and various regions of the country.

The auditors maintained that such a mechanism was necessary to improve financial monitoring and verify whether development resources were being used for their intended purposes.

Meanwhile, the report also highlighted a large number of cases involving incomplete compliance with directions issued by the Public Accounts Committee.

According to the official record, 172 audit paragraphs were listed for the Cabinet Division across the financial years covered by the review.

Of these, 47 were recorded as compliant, while 125 were classified under noncompliance or partial compliance.

The record also showed that 73 actionable points had been issued during the period.

The findings raised concerns about the handling of audit matters that had remained unresolved or only partly addressed over several financial years.

For the financial year 2016 to 2017, all 22 audit paragraphs were shown under noncompliance or partial compliance.

Similarly, 36 audit paragraphs relating to the financial year 2022 to 2023 were recorded in the same category.

During 2019 to 2020, the division recorded 15 audit paragraphs, of which three were shown as compliant and 12 remained under noncompliance or partial compliance.

For 2023 to 2024, the report showed 19 audit paragraphs, with 11 compliant cases and eight cases of noncompliance or partial compliance.

The financial year 2024 to 2025 recorded 16 audit paragraphs, all classified as noncompliant or partially compliant.

These figures raised further questions about the division’s progress in addressing audit objections and implementing financial accountability measures.

The audit also identified weaknesses in the Cabinet Division’s budget planning and the use of supplementary grants.

According to the report, the division’s original budget for the financial year 2024 to 2025 stood at Rs 196.06 billion.

The division subsequently obtained additional grants amounting to Rs 7.30 billion but later surrendered Rs 32.29 billion.

Following these adjustments, the final approved budget stood at Rs 171.06 billion.

Actual expenditure reached Rs 170.40 billion, leaving approximately Rs 662.48 million unspent.

The auditors raised concerns about supplementary grants being obtained without careful cash forecasting.

They referred to Paragraph 71 of the General Financial Rules, Volume I, which requires government departments to prepare financial estimates with proper planning and realistic calculations.

According to the detailed budget figures, current expenditure stood at Rs 55.01 billion, while development expenditure reached Rs 115.39 billion.

The report also showed that the division had 43 formations, of which three were audited, while two out of 13 authorities and autonomous bodies were covered by the audit exercise.

Expenditure amounting to approximately Rs 12.08 billion was examined under the formations category.

The Cabinet Division is responsible for several major government functions, including coordination of cabinet decisions, implementation of directives issued by the Prime Minister and President, and administrative oversight of important government institutions.

Its responsibilities also include matters relating to the Pakistan Tourism Development Corporation, Islamabad Club, Pakistan Cricket Board, Pakistan Telecommunication Authority, Oil and Gas Regulatory Authority, National Electric Power Regulatory Authority and Public Procurement Regulatory Authority, among other institutions.

The report’s budget and compliance findings concern the Cabinet Division as a whole and do not establish separate financial irregularities at each of these institutions.