ISLAMABAD: An audit report has raised serious concerns over the financial affairs of the Securities and Exchange Commission of Pakistan (SECP), including the unauthorised increase in salary packages for its chairman and commissioners, amounting to over Rs156 million annually.
The report, compiled by the Auditor General of Pakistan (AGP), said that under the law, the SECP must obtain approval from the Ministry of Finance for salary hikes. However, the SECP management proceeded with a pay raise for its employees during a Policy Board meeting on Oct 17, 2024, with effect from July 1, 2023.
The audit found that the salary package of SECP Chairman Akif Saeed reached Rs41.53m for the fiscal year 2023-24, while each commissioner received Rs35.8m due to the backdated salary increases. Additionally, the report revealed that SECP illegally distributed Rs110m for entertainment allowances to its commissioners and staff.
The AGP’s findings highlight that while the SECP Policy Board approved these raises, it lacked the authority to sanction such increases. Besides, the pay and allowance increases were made without prior approval from the finance division, totalling Rs377.22m.
The audit report urged the finance ministry to either approve or reverse these illegal increases.
The audit also highlighted that SECP had failed to deposit around Rs14 billion into the Federal Consolidated Fund, including Rs7.11bn in revenues. These funds were generated through licensing and registration fees (Rs4.13bn), the insurance sector (Rs591.56m), the securities market (Rs47.77m), and specialised companies (Rs1.91bn).
Under Section 37(1) of the Public Finance Management Act, 2019, all revenues collected by an autonomous entity under federal government statutory instruments must be deposited in the treasury single account. However, SECP did not comply with this requirement.
The SECP also failed to deposit a surplus balance of Rs6.99bn into the Federal Consolidated Fund, even though any surplus of receipts over actual expenditure must be remitted to the Fund.
