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Islamabad: Capital projects under a cloud on funding shortage - Naveed Yaseen - 11-03-2008 07:53 AM
by Mobarik A. Virk
The Capital Development Authority (CDA) seems to have been caught in an economic quagmire and is gradually sinking with its resources depleting and the on-going projects worth billions coming under a cloud.
The new Chairman of the authority, Tariq Mehmood, spoke openly about the worsening financial conditions of the CDA at a meeting of CDA officers on Thursday last at the Convention Centre. In his address he took stock of the financial crunch the authority was faced with and called for tightening the belts to deal with the crisis.
A spokesman for the CDA when contacted by ‘The News’ also confirmed that the authority was “in deep trouble on the financial side” and added that a letter has already been written to the Cabinet Secretary informing him about the situation.
A senior official conceded that the financial conditions of the authority are threatening a ‘slow down’ in the pace of work on the on-going projects as well as may cause a delay in approval for execution of some of the upcoming projects in the federal capital.
On the other hand the junior officials of the authority said that the situation is worsening to the extent that the workers in the authority are now becoming seriously worried about the payment of their salaries. Their anxieties were only heightened because of the recent address by Chairman Tariq Mehmood, in which he highlighted the economic crisis in the authority.
Sources in the CDA told ‘The News’ that the fabulous budget of Rs26 billion announced by the former chairman of the authority in June this year was based on the speculative figures of possible earnings through the sale of residential, commercial and farm house plots in hand as well as through various civic taxes.
However, according to the sources in the authority there are hardly Rs8 billion left with the CDA, something which is seriously going to disrupt a number of authority’s development projects and plans as it would not be able to make payments to the contractors engaged on some big projects like the newly launched ‘Zero Point Interchange’ as well as the already much delayed flyover project on the Jinnah Avenue-Faisal Avenue junction.
But one of the top officers in the CDA said that the situation may be bad but not as worse as is being feared by the people. “Yes, we know that there have been ‘some over spending’ done during the times of the previous chairman but we believe that it would not overly affect the working or the performance of the authority,” he told ‘The News’.
“We are well aware of the situation and preparing to straighten out the faults and flaws that we have inherited. There is a new team in the authority and it would take us a little while to completely understand the situation. We are working on this and we are confident that we will be able to handle this critical situation,” one of the Member of the CDA Board said.
The officials in the Directorate of Lands said that the authority has badly faltered on account of developing new sectors because it has spent all the money received from sale of plots, both residential as well as commercial, in sectors I-14, I-15 and I-16 on other projects, mainly to meet the demands of the Directorate of Roads.
“This has resulted in the delay in development of these sectors because no funds were allocated for the development of infrastructure in these sectors,” he said.
The officials in the authority said that as a policy the money earned from the sale of plots in a new sector should have been spent for the development of basic infrastructure there so as to develop it quickly and hand over possession of plots to the owners. “But this was not done and that is the reason that people, who have bought plots in these sectors are frustrated and worried,” the sources in the Land Directorate told ‘The News’.
But one of the top officials in the authority said that it was not unusual to use money received from one sources for other development projects. “This policy is followed internationally. There are no hard and fast rules to spend the money only for the purpose it was acquired. There are so many projects going on and the money is used where it is needed most. We will make funds available for the development of these sectors as well,” the gentleman said.
But, he conceded that the situation was certainly not very ‘rosy’ and some urgent steps would be required to strengthen the financial situation of the authority to keep the on-going development projects without any hindrance as well the ones that are in the pipeline.
http://www.thenews.com.pk/daily_detail.asp?id=144632