The audit records of Khyber Pakhtunkhwa’s (KP) local governments from 2002 to 2024 have uncovered massive financial irregularities amounting to Rs354.126 billion. Despite these findings, the majority of these audit objections remain unresolved due to the absence of an effective system to address them. Over the past two decades, the Auditor General’s office has recovered only Rs3.232 billion—a mere fraction of the total irregularities. Experts attribute this failure to the PTI government’s inability to operationalize Tehsil Accounts Committees and its lack of legislative reforms to strengthen oversight of local government finances.
The 2019 Amendment Act mandated the formation of Tehsil Accounts Committees to review audit reports, budgets, and financial statements, but these committees were never established. In contrast, provinces like Punjab, Sindh, and Balochistan regularly scrutinize local government audits through their Public Accounts Committees. A senior government official warned that without urgent reforms, audit objections will keep increasing, leaving public funds vulnerable to mismanagement. The official also highlighted that the current law lacks a mechanism to resolve pre-2019 audit paras, exposing systemic failures in financial accountability.
A spokesperson for the KP Local Government Department claimed that the provincial government has not received any audit reports from the Auditor General’s office. If received, these reports would be forwarded to Tehsil Councils, as the Tehsil Accounts Committees are legally responsible for reviewing them. Over 22 years, 765 audit reports identified 18,090 audit paras involving misuse or mismanagement of public funds. Despite objections worth Rs354.126 billion, only Rs3.232 billion has been recovered, leaving Rs350.893 billion unresolved. Yearly data shows a persistent trend of high irregularities and minimal recoveries, with the highest objections recorded in 2021-22 (Rs52.438 billion) and 2022-23 (Rs52.658 billion).
An official from the Auditor General’s office stated that the recurring audit issues reflect deep-rooted inefficiencies in local governance and financial oversight. The KP government’s failure to activate accountability mechanisms has rendered the audit system ineffective in safeguarding public funds. The Public Accounts Committee, under the 2019 Act, lacks the authority to address local government financial matters, further exacerbating the problem. Without urgent structural reforms, experts warn that financial mismanagement will continue unchecked, leading to further losses of taxpayer money.