When somebody tries to sell you securities that have been withdrawn, it is fraud. But what do you call it when an authentic official document lists such securities among those available for sale?
An official document ancillary to the federal budget for the current fiscal incorrectly lists among “bearer type non-terminable securities freely en-cashable and transferable by delivery” national prize bonds in the denominations of PKR 7,500, 15,000, 25,000 and 40,000.
The fact is, National Prize Bonds in denomination of PKR 40,000, 25,000, 15,000, and 7,500 were withdrawn in two phases over the last two years by the Federal Government through State Bank of Pakistan.
The PKR 40,000 prize bond was withdrawn during financial year 2019-20 and the people brought bags of these to get them cashed or changed from the banks.
Official document “Pakistan Economic Survey 2020-21” issued by the Finance Division Government of Pakistan, traditional ahead of the announcement of new federal budget in the second week of June 2021, in its Chapter on Public Debt, says (correctly): “The PKR 25000, PKR 15000 and PKR 7500 denomination prize bonds were withdrawn from circulation in order to improve the documentation of the economy. The holders have been given options to (i) convert to premium prize bonds; or (ii) replace them with eligible National Savings Certificates; or (iii) en-cash at face value into their bank accounts”.
The State Bank of Pakistan had fixed the deadline of 31 May 2021, prior to which the holders of prize bonds in these denominations could get their prize bonds changed or cashed.
However, “Federal Budget 2021-22 Explanatory Memorandum on Federal Receipts”, issued by the Finance Division, Government of Pakistan, Islamabad, states on its page 49 (incorrectly): “National Prize Bonds; These are of bearer type non-terminable securities freely en-cashable and transferable by delivery. These are issued in denomination of PKR 100, PKR 200, PKR 750, PKR 1500, PKR 1500, PKR 7,500, PKR
15,000, PKR 25,000 and PKR 40,000.”
National Prize Bonds are the saving instrument of choice for Pakistan’s lower and middle class. First introduced in 1960, they have been issued in various denominations including PKR 100, 200, 750, 1500, 7500, 15000, 25,000, and 40,000.
(The last four denominations – PKR 40,000, 25,000, 15,000, and 7,500 – have since been discontinued.)
While this may look like a minor error to some, this opens a potential loophole for abuse by unscrupulous elements. Who is to blame for this misleading information given in the official document? Can the authorities envision any corrective action for this blooper?
