Financial irregularities amounting to Rs32 billion have been uncovered in the Khyber Pakhtunkhwa Cities Improvement Project (KPCIP), according to a letter submitted to the Public Accounts Committee (PAC) Chairman and Speaker of the KP Assembly, Babar Saleem Swati.

The allegations were raised by members of the Khyber Pakhtunkhwa Assembly, including PTI lawmakers and MPA Sajjadullah (JUI-F), Muhammad Riaz, Taj Muhammad, and Munir Hussain Laghmani.

According to the letter, an unregistered foreign company was allegedly granted unlawful financial benefits, while a joint venture between a Pakistani and foreign firm was awarded a multibillion-rupee project under questionable circumstances.

The project, aimed at upgrading urban infrastructure in Peshawar, Abbottabad, Kohat, Mardan, and Mingora, is now under scrutiny for suspected procedural violations.

The lawmakers claimed that at the time of bidding, the selected company was not registered with the Federal Board of Revenue (FBR), Khyber Pakhtunkhwa Revenue Authority (KPRA) or the Pakistan Engineering Council (PEC) — a requirement for undertaking public sector projects.

Despite minimal physical progress on the ground, the letter alleged that Rs32 billion in payments were disbursed based on falsified progress reports, inadequate supervision, and alleged collusion between project staff and consultants.

Furthermore, the foreign company reportedly failed to pay income tax, sales tax, or withholding tax, and no official records of tax compliance exist.

The assembly members have demanded that the case be referred to the National Accountability Bureau (NAB), FBR, and other relevant authorities for investigation.

In response, PAC Chairman Babar Saleem Swati has called a meeting for 17 July to address the matter. The Deputy Auditor General (North), Secretary Communications and Works, and Secretary Local Government and Rural Development have been summoned to attend.

Chairman Swati has also instructed the relevant departments to submit comprehensive responses to the allegations.

JUI-F leader Sajjadullah said that a formal request has been submitted to the PAC, stressing the need for a thorough investigation into “large-scale corruption.”