ProPropertyNewsAGP Raises Concerns Against CDA for Awarding Housing Project to FWO

AGP Raises Concerns Against CDA for Awarding Housing Project to FWO

ISLAMABAD: The Auditor General of Pakistan has raised concerns after the Capital Development Authority (CDA) awarded a low-cost housing project worth PKR 14.7 billion to the Federal Works Organization.

According to AGP, FWO has no experience in housing projects, yet the CDA has awarded a low-cost housing project to FWO at excessively high prices.

As per the details, the low-cost apartments were to be built in Farash Town for the beneficiaries of the Naya Pakistan Housing and Development Authority, displaced persons of the kachi abadis, and the general public.

The AGP report said that the project was awarded to FWO on an Escalation Payment Certificate (EPC) basis and was to be completed with a budget of PKR 13.4 billion. However, the CDA revised the letter of acceptance and raised the amount to PKR 14.7 billion.

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Additionally, a board meeting held in march 2022 discussed that a new low-cost housing scheme was to be planned under the name of Model Urban Shelter Project (MUSP).

It was added that the project aims to accommodate a number of families along with the settlements of kachi abadi residents.

The board members were also briefed that a concept plan had been designed by FWO for vertical construction that would comprise more than 4,400 apartments on the allocated land.

A contradiction also came to the fore when CDA claimed that the said project would be executed by FWO, while on the other hand, NAPHDA claimed in November 2021 that NAPHDA was executing the said project in collaboration with FWO and CDA.

While briefing the Former Prime Minister Imran Khan, NAPHDA claimed that 2,000 apartments would be allotted to members registered with NAPHDA, 400 to the people of kachi abadis, while the remaining 2,000 apartments would be sold to the general public

Later an CDA was audited by the Auditor General of Pakistan and the report said that CDA was one-time exempted by the Cabinet Division to bypass the PPRA rules on the recommendation of the regulatory authority’s board.

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The report also noted that a Memorandum of Understanding was signed between CDA, NAPHDA, and FWO for the execution of the project on an Escalation Payment Certificate (EPC) basis.

The audit also revealed that the CDA and the Development Working Party (DWP) approved the project’s PC-1 for Rs15.3 billion, with the condition that it be carried out through the FWO.

The CDA and DWP had no authority to decide whether or not the project would be carried out through the FWO, according to the report.

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It also noted that the PC-1 cost was provided as a lump sum per square foot rather than being based on specific quantities and rates.

The auditor noted that while the exemption from the PPRA rules was granted on April 16, the MoU between CDA and FWO was signed on April 8, 2021. It demonstrated that CDA made the choice in anticipation of approval.

According to the audit report, CDA could have gotten better rates if it had released the tender and gone with a competitive procedure. It advocated looking into this matter carefully and bringing charges against the CDA officials.

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