Official of the ministry, who were giving testimony to parliament´s Public Account Committee (PAC) on the recent controversies over the NAC´s decision to purchase two Airbus aircraft at the cost of $137.24 million, said the ministry has summoned officials of NAC on Monday to clarify issues that MOF has raised.
“We have prepared a set of nine-questions to ask to the management of NAC and we are expecting convincing answers,” said the officials.
MoF that has the legal authority to issue government guarantee on the loans that the Nepal Airlines Corporation (NAC) is planning to mobilize to purchase two aircraft, sought clarification from the NAC on Wednesday. “We want to be satisfied that there is no mala fide intention behind the deals before we think of issuing government guarantee on the loans that NAC is planning to take,” said finance secretary Rameshwar Khanal to OPAC meeting on Friday.
Employment Provident Fund (EPF), which is regarded as the largest non-financial institution in terms of deposits worth Rs 80 billion belonging to some 440,000 government employees, is the only lender ready to extend loan worth Rs 10 billion to help NAC purchase two aircraft.
Khanal also expressed dissatisfaction over the decision of the NAC management to send commitment payment without consultations with the concerned ministries and warned that those who ordered and issued the payment will have to face legal consequences if the government decides not to purchase aircraft.
Secretary Khanal reiterated that the MOF was unaware of sending the commitment payment and said that the payment was sent without thoroughly examining the sources of funds needed to purchase the two aircraft. We don´t know why the NAC management was in such a hurry to send the payment by bypassing the standard procedures like seeking consensus from MOF other related agencies, he said.
Finance secretary Khanal reiterated that the government will not issue any loan guarantee so long as the NAC doesn´t come up with a clear and convincing business as well as procurement plans. Along with the reform and restructure plan, we have told many times that we need a concrete business plan outlining what will be financial status of NAC after purchasing the aircraft and how it is planning to pay back the loans, he said.
Khanal further said that the government favors the NAC´s attempts to bring two aircraft but stressed that all the procurement procedures should be transparent.
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