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Supreme Court Questions the Transfer of USF Funds to Finance Ministry

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Supreme Court Questions the Transfer of USF Funds to Finance Ministry

The federal government on Thursday informed the Supreme Court that Ministry of Finance had transferred Rs62 billion to the consolidated fund from the Universal Services Fund (USF) after making necessary amendments in the relevant rules.

[blockquote cite=”An additional secretary Information Technology”]
The funds were placed from Ministry of Information Technology-USF account to Federal Consolidated Fund (FCF) of Ministry of Finance in pursuance of the Economic Coordination Committee (ECC) decision the federal government issued necessary notification for amendments in USF Rules 2006.
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A three-judge SC bench headed by Chief Justice Iftikhar Muhammad Chaudhry was hearing a petition seeking a direction for urgent auction of 3G cellular license, utilization of USF and appointment of chairman and members of boards in Pakistan Telecommunication Authority PTA.

Dr Waqar Masood, Federal Secretary Ministry of Finance, appeared before the court and affirmed that the USF money had been transferred to FCF after amending the relevant rules.

“Consequently, existing rule was substituted as the USF shall be kept in the FCF and the ministry of finance shall release funds of the USF in accordance with the procedure laid down in these rules through budgetary mechanism”

Advocate Ali Raza representing the petitioner Khurram Shahzad Chughtai, however, opposed the move saying under the constitution only the money generated through revenue could be deposited in FCF and the USF was deducted from the income of the mobile operators and was meant for welfare of the people living in remote and underdeveloped areas of Pakistan.

The bench also comprising of Justice Jawwad S Khawaja and Justice Sheikh Azmat Saeed directed the secretary finance to submit his written response before next date of hearing and adjourned the hearing till August 6.

The court further directed secretary cabinet division to file his comments regarding the auctioning of 3G spectrum in Pakistan and causes that had delayed the process so far.

Giving detailed causes of the delay in ushering in the 3G spectrum the IT ministry stated that the policy directive for the auction was issued by the ministry on December 19 2011. Subsequently the PTA initiated the process of hiring consultants but the process was stopped on the instruction of Auction Supervisory Committee. Again in November 2012 the process was initiated but it could not be completed by the PTA. The IT ministry further informed the bench that the spectrum being auctioned represents three blocks of 10 Mhz each in the 2100 Mhz band.

While other blocs can be made available the same is dependent upon Frequency Allocation Board making available such spectrum as the same is being utilized for non-commercial purpose.

In view of the previous expressions of interest received at least five blocks can be auctioned while ensuring competition in auction or alternatively raising the base price of the spectrum.