111 510 510 libonline@riphah.edu.pk Contact

Self-serving laws – II

On announcement of judgement on June 1, 2018, however, the ECP took diametrically opposite stand and decided to challenge the judgement in the Supreme Court. The federal government as well as the Speaker National Assembly also decided to contest the order of Lahore High Court. With no offence to the honourable judge, the decision of Lahore High Court should have been made on priority basis, due to importance of issues raised and forthcoming elections of Senate, National and provincial assemblies. Unfortunately, the order in writs directing the ECP to seek all necessary information from candidates was not passed in time to settle the controversy well before the announcement of schedule of 2018 elections. Since, the order of Lahore High Court could have delayed the holding of elections on time it was suspended on June 3, 2018 by the Supreme Court. The suspension of order by the apex court was appropriate to ensure that elections scheduled for July 25, 2018 are not delayed. Later, a five-member bench of Supreme Court was constituted to hear the case on June 6, 2018 after which, the apex court instructed aspiring candidates to submit an affidavit, detailing their assets, along with their nomination papers. It also asked the ECP to prepare the affidavit. According to a press report, the Supreme Court also instructed Returning Officers to submit the affidavits of contesting candidates to the court and warned that strict action would be taken against lawmakers who submit false information. The Chief Justice of Pakistan observed that people must know the integrity and veracity of the contesting individuals. He asked the counsel for Speaker, Ayaz Sadiq, as to why lawmakers were shying from disclosing information by omitting details in the new nomination forms. Chief Justice said that as “custodians of the Constitution”, the apex court wanted transparency in the process and would seek information by exercising powers under Article 184(3) of the Constitution. He again reiterated his resolve that there would not be any delay in the forthcoming polls.

In the wake of 2008 and 2013 elections, the people of Pakistan thought that their elected members would reform the electorate system but on the contrary, they ensured through the Election Act, 2017 that financial matters remain totally eclipsed from public eyes. In an op-ed, [Electoral reform-unfinished agenda], published on January 2, 2018, Tariq Malik, ex-Chairman of National Database & Registration Authority (NADRA), voiced his concern as under:

Sadly, the Election Act of 2017 has clipped the powers of the Election Commission of Pakistan (ECP) to scrutinise candidates with regard to the declarations about their income, asset and loan status. Under the previous nomination forms, all election candidates had to declare under oath that: “I hereby solemnly declare to the best of my knowledge and belief that (i) no loan for an amount of Rs 2 million or more obtained from any bank, financial institution, cooperative society or corporate body in my own name or in the name of my spouse or any of my dependants or any business concern mainly owned by me or the aforesaid stands unpaid for more than one year from the due date or has been written off.” Similar declarations were required with regard to the payment of utility bills and any criminal offences. Considerable administrative input has already gone into efficiently compiling this information and strengthening the capacity of the ECP to scrutinise candidates in the light of these public disclosures. There is clearly room for improvement, but it is ill-advised to do away with such public declarations altogether… . The revised format for nomination papers would no longer allow ordinary citizens to access information on loan defaults and taxes paid by candidates. With regard to the former, there is a clear attempt by our political class to shelve the issue as a closed and shut case. A legacy of the 1990s era, loan defaults were, in their essence, a political issue. Respective governments in this period used state-owned banks to grant loans to politicians masquerading as businessmen. In many cases, political clout was used to write off the loans of connected borrowers. In their seminal and landmark research on the subject, Asim Khwaja and Atif Mian, two social scientists, have already shown that politically connected firms during the 1990s and early 2000s were 45 percent more likely to obtain a loan from government-owned banks and were 50 percent more likely to default on these loans. Many of these beneficiaries should be clearly ineligible for public representation.

Many beneficiaries of loan write-offs are still part of parliaments though Supreme Court asked the government to punish them and their accomplices. Supreme Court in a Suo Motu Case No. 26 of 2007 and Human Rights Case Nos. 2698/06, 133, 778-P, 13933 and 14072-P of 2009, while questioning the authority and jurisdiction of State Bank of Pakistan (SBP) to waive off loans, constituted on June 3, 2011, a commission, headed by Justice Syed Jamshed Ali, former judge of the apex court, to prepare a report in respect of recovery of written-off loans from 1971 onwards. The commission submitted its report in Supreme Court and a hearing was conducted on February 20, 2013. The court on the same date ordered: “the report of the commission to be made public, which is available for inspection according to the rules to all and sundry. However, the procedure for allowing inspection of the report shall be regularized by the office. The locked iron boxes are ordered to be kept in safe custody along with their keys.” Notice was also issued to all the learned counsel appearing in the case and all concerned for March 15, 2013.

The commission revealed that loans worth Rs 2.38 billon were waived off between 1971 and 1991 whereas loans worth Rs 84.62 billion were waived off between 1992 and 2009. The commission, while holding bankers responsible for extending short-term or long-term loan facility to borrowers on inadequate securities, had recommended action against wilful defaulters who took benefit of SBP’s Circular BPD No. 29, which expired on April 14, 2003 although the banks continued writing off loans until 2011.

The commission also gave the names of companies and directors who were beneficiaries of loan waivers but no action has been taken so far. The commission could only probe 740 cases and proposed investigation in another 222 cases where Rs 35 billion loans were waived off. The report found serious irregularities in loans given to politicians, civil and military bureaucracy, but could not get proofs about waiver on political basis, as bank officials allegedly “concealed the facts because they were afraid of the influential persons.” The bankers, the report says, “have given only business reasons for writing off the loans.” The report consisting of three volumes – Volume I (Report of the Commission), Volume-II (Parts I to VII, synopsis of individual cases), Volume-III (Annexure of Volume I) – and the supplementary paper book (containing different correspondence).

The commission suggested four steps: (i) principal amount should be recovered less payment already made, if any; (ii) tribunals comprising the on duty or former judges of high courts should be set up for the recovery of amounts; (iii) legislation for the recovery of written-off loans should be made; and (iv) action should also be taken against the credit committees. As expected, the powerful vested interests resisted all the steps proposed by the commission. Till today, not a single rupee stands recovered from any big fish. Now they want to conceal these facts from voters as well in their nomination papers!

The inquiry into loan write-offs by the commission revealed the modus operandi used for looting public money by the powerful segments of society. It is time that the plunderers of public funds are punished and money squandered by them is recovered as suggested by the commission without any further delay-it is essential for establishing true democratic polity and bringing about transparency in both the public and private institutions. If 2018 elections are held without such scrutiny, it will be nothing but another farce for the people of Pakistan. On May 18, 2018, the Supreme Court summoned 222 firms and companies for June 8, 2018 for their alleged involvement in getting non-performing loans (NPLs) worth billions of rupees written off by commercial banks. The Supreme Court on April 26, 2018 revived the case of politically-motivated loan write-offs. Eelier on April 26, 2016 as well, Supreme Court asked 12 commercial banks to submit comprehensive reports showing the volume of loans waived off by them after 2009 since a three-man commission headed by Justice Syed Jamshed Ali Shah had already released its report regarding write-offs from 1971 to 2009.

It is the constitutional command that honest and truthful declaration of all facts, assets and liabilities by a contesting or returned candidate in his/her nomination papers, constitutes a benchmark for reviewing his/her integrity and probity in the discharge of his/her duties and functions as an aspiring or elected legislator. Statement of assets and liabilities along with other financial disclosures is a constitutional requirement and cannot be waived or relaxed under the Election Act, 2017-a subordinate legislation. These disclosures are not only essential but represent fundamental right of voters for determining the suitability of any candidate.

Parliament cannot make any law that is against the fundamental rights guaranteed in the Constitution and if it does so, the high courts or Supreme Court can strike down the same under the power given by the Constitution. Parliament has every right to enact laws but not by violating or offending the fundamental rights of the citizens-as has been done in many provisions of Election Act, 2017.

During the decade of democracy, legislators have shown little interest to enact laws for pensions to all citizens and income support to millions living below the poverty line. There was no will on the part of parliament to enact laws for confiscating illegal assets stashed at home and abroad. In the last two terms, the National Assembly or Provincial Assemblies did not bother to improve outdated laws to protect lives of workers at work place, especially the hazardous ones like deep shaft mines, and provide them better facilities, but many laws for own benefits were passed in minutes, without any debate or taking into consideration objections raised, In these circumstances, are parliamentarians justified in demanding respect from the masses? Are parties ethically warranted to seek support and votes from the people? The sloganeering of ‘sanctity of vote’ and “support us under all circumstances” does not suit those who are themselves offenders, looters and plunderers of national wealth.

 

Huzaima Bukhari and Dr Ikramul Haq, "Self-serving laws – II," Business Recorder. 2018-06-10.
Keywords: Political science , Nomination papers , Financial disclosures , Election act , Supreme court , Parliament , Affidavit , Assets , Chief justice , Ayaz Sadiq , NADRA , ECP , SBP

Leave a Reply

Your email address will not be published. Required fields are marked *