ISLAMABAD: After it was revealed that Rs1,000 billion have been parked into commercial banks by public entities, it has now been discovered that the Securities and Exchange Commission of Pakistan (SECP) paid out Rs1.191 billion to its then chairman, commissioners, executive directors, directors and many others for salary, perks, privileges, others benefits such as gratuity, trust and pension with retrospective effect.
All these benefits were drawn in the last 16 months with retrospective effect with the approval of the Board of SECP. The impact of SECP payments paid out in 16 months from July 1, 2023 to October 31, 2024 with retrospective effect stood at Rs1.191 billion. This controversy was triggered when Senator Anusha Rahman, belonging to the ruling PMLN, pointed out that the public entities had parked Rs2,000 billion into the accounts of commercial banks instead of depositing it in the Federal Consolidated Fund (FCF) or Treasury Single Account in a clear-cut violation of the Public Finance Management (PFM) Act 2019.
According to official data, the then chairman and three members of SECP drew Rs65.559 million, nine executive directors Rs68.787 million, 16 directors Rs87.046 million, 33 directors Rs135.123 million, 32 joint directors Rs56.391 million, 58 additional joint directors Rs68.541 million, 42 deputy directors Rs25.142 million, 55 assistant directors Rs18.296 million, three management executives Rs398,481, 140 staff/non-management Rs53.839 million.
The total perks, privileges and remuneration as arrears were drawn to the tune of Rs579.139 million for 16 months with retrospective effect. The terminal benefits paid to the SECP on Gratuity Fund, Trust Fund and Pension during this period stood at Rs612.054 million. So the total ballooned to Rs1.191 billion from July 1, 2023 to October 31, 2024.
This scribe contacted the SECP spokesperson and sent him questions. When asked for funds released for perks, privileges, pension and gratuity from 2023-2024, the SECP spokesperson responded that the SECP conducted a comprehensive salary benchmarking survey through KPMG to align its compensation structure with market standards. Based on the findings of this survey, a proposal was developed to rationalise employees’ salaries in line with prevailing market benchmarks.
The proposal was duly reviewed and approved by the SECP Policy Board, being the competent authority under the SECP Act, 1997. In accordance with the approved proposal, an amount of Rs579 million was disbursed to employees as salary arrears covering a period of 16 months. In addition, Rs612 million were transferred to SECP Gratuity Trust and Pension Fund Trust. These funds are maintained to meet employees’ terminal benefits, including gratuity and pension, at the time of retirement or separation, in line with established policies.
To another query whether approval from the Ministry of Finance and Prime Minister’s Office was sought for granting salary, other perks and privileges, the spokesperson stated that under the SECP Act, 1997, SECP Policy Board is the competent authority to approve the commission’s budget and all policy matters with financial implications. Accordingly, the above expenditures were made with the approval of competent forum, in accordance with the applicable legal framework.
When asked whether the information was shared with the parliamentary panel in this regard, the spokesperson stated that the SECP shared information with relevant oversight forums, including parliamentary committees, as and when required, in accordance with statutory provisions and established procedures. This scribe inquired whether an audit had been done by the AGP so far, the spokesperson replied that the matter has not been taken up for discussion at the Departmental Accounts Committee (DAC) level so far. However, the SECP follows a structured mechanism for addressing all audit observations raised by the Auditor General of Pakistan, in accordance with prescribed procedures.
