In perhaps the biggest ever real estate ‘deal’, the Employees Old-Age Benefits Institution (EOBI) has purchased 321.3 kanals of land from the Defence Housing Authority (DHA) at an unbelievably exorbitant price of about Rs16 billion, while outrightly denying to the Ministry of Human Resource Development (HRD), it had ever gone for such transaction.
The purchase was made ignoring the hard fact that the EOBI had already invested much more than what it could under the rules as investments in real estate must not be more than 12.5% of the institute’s total available funds.
This mega deal was made despite a strong objection from Muhammad Naseer Jamali, the Sindh Labour Secretary and member Board of Trustees (BoT), who, among other points, had noted that the EOBI had negotiated with a single party i.e. M/s Elysium and no competitive bidding was conducted; hence, the proposed investment could not be treated as transparent.
He also observed in the current situation, this investment might cause heavy financial losses to the Institute as the land is in raw shape, under-developed and might lead to allegations’ charges for the EOBI.
Jamali continued the firm was also not ready to provide vital bank guarantee of pay back of 31 percent return after one year. He noted the bank guarantee would protect the interest of the EOBI. He opposed any deal in a hurry and advised for BoT approval, the copy of the letter he had written to the Ministry of Labour and Manpower is with this scribe. Similar concerns were raised by Punjab Labour and Human Resource Secretary Abdur Rauf Khan in his letter No PSO/Secy/10/2010. However, ignoring these points, even the proposal of bank guarantee was also dropped.
Sources at the HRD revealed to The News that Minister of State PML-Q’s Shiekh Waqas Akram had repeatedly written to the EOBI about the deal after learning from certain quarters about it. The copies of letters, he wrote to the EOBI are with this correspondent. EOBI functions under HRD.
However, the institute, which deals with pensions of retired employees and widows, maintained that no purchase was made. Continue reading