MoF takes clarifications from minister, NAC boss

The Ministry of Finance (MoF) has begun taking clarifications from Minister for Civil Aviation and Tourism Sharad Singh Bhandari and Executive Chairman of Nepal Airlines Corporation (NAC) Sugat Ratna Kansakar over their recent controversial decision to send commitment money to the manufacturer of Airbus aircraft without following the relevant procedures.

The meeting on Monday attended by Finance Minister Surendra Pandey, Finance Secretary Rameshwor Khanal and Joint-Secretary Tankamani Sharma asked Minister Bhandari and Chairman Kansakar to clarify why they sent the amount to Airbus without consulting the ministry and following relevant procedures.

Tourism Minister Bhandari and Executive Chairman Kansakar were present at the meeting to furnish clarifications as sought by MoF. MoF last Wednesday asked them to be present in person with nine-point clarifications on their decision to release the money to the aircraft manufacturer.

"We held a meeting with Bhandari and Kansakar," said Sharma, Joint-Secretary at MoF, adding, "We, however, couldn´t reach any conclusion over the matter." He said the meeting will continue on Tuesday also. According to him, the clarifications furnished by the NAC chairman and the minister were not satisfactory and complete and they have asked them to come up with further details.

Bhandari and Kansakar said at the meeting that they couldn´t furnish detailed information as they received the MoF´s request for clarifications only late Sunday. Officials said the meeting couldn´t continue for long as Minister Bhandari left shortly after, citing urgent work. He was grilled briefly over the NAC decision. MoF had sought clarifications from the management (of NAC) on its decision to send commitment money amounting to Rs 57.3 million to the European aircraft maker.

According to Joint-Secretary Sharma, the ministry, which had given testimony to parliament´s Public Accounts Committee (PAC) over NAC´s decision to purchase two Airbus aircraft at the cost of $137.24 million, summoned NAC officials and Minister Bhandari to clarify issues that MOF has raised. MoF has legal authority to underwrite loans that NAC is planning to mobilize to purchase the two aircraft.

According to Joint-Secretary Sharma, both Bhandari and Kansakar defended themselves, saying the decision to send the commitment money was reached with positive intent and no mala fide intention was involved.

MoF officials have expressed dissatisfaction over the decision of NAC management to send the commitment payment without any consultations with the ministries concerned and warned that those who ordered and issued the payment will have to face legal consequences if the authorities decide not to purchase the aircraft. MoF has already said that the government will not issue any loan guarantee so long as NAC doesn´t come up with clear and convincing business and procurement plans.
Source:Republica