SECP Backdated Salary Payments
SECP Backdated Salary Payments. The Securities and Exchange Commission of Pakistan (SECP) has found itself at the centre of a growing controversy after it was revealed that Rs. 1.191 billion was paid out to its top officials and staff in salaries, perks, privileges, and post-retirement benefits. What makes this case particularly notable is that these SECP backdated salary payments were made with retrospective effect, covering a period of 16 months from July 1, 2023 to October 31, 2024. The SECP Board approved the payments and have since attracted serious attention from lawmakers and the general public alike.
How the Issue Came to Light
The controversy did not surface on its own. It was brought into the public spotlight when Anusha Rahman raised the matter in parliament, questioning the financial practices of the regulator. Her concerns went beyond just the salary payments. She highlighted that as much as Rs. 2,000 billion may have been placed outside the government’s main account system, which could amount to a serious violation of established financial laws. This parliamentary intervention turned what might have remained an internal matter into a question of national accountability and governance.
Detailed Breakdown of SECP Backdated Salary Payments
To understand the full scale of these SECP backdated salary payments, a look at the official figures tells a clear story. The then chairman along with three members received Rs. 65.559 million, while nine executive directors drew Rs. 68.787 million. Sixteen directors received Rs. 87.046 million and 33 directors received Rs. 135.123 million, making the director-level payouts particularly significant.
Further down the hierarchy, 32 joint directors received Rs. 56.391 million, 58 additional joint directors received Rs. 68.541 million, 42 deputy directors received Rs. 25.142 million, and 55 assistant directors received Rs. 18.296 million. Three management executives received Rs. 398,481, while 140 staff and non-management employees collectively received Rs. 53.839 million. The numbers span every level of the organisation, making this a institution-wide financial decision rather than a benefit limited to senior leadership alone.
How the Total Rs. 1.191 Billion Was Distributed
Out of the total Rs. 1.191 billion, the payments were divided into two broad categories. The first portion, amounting to Rs. 579.139 million, was disbursed directly as salary arrears and perks for the 16-month backdated period. The second portion, Rs. 612.054 million, was transferred into gratuity, trust, and pension funds. According to the SECP, this second amount is intended to cover employees’ terminal benefits at the time of retirement or separation from service. Together, these two figures add up to the total Rs. 1.191 billion that has sparked the current debate.
SECP’s Official Justification
When questioned about the legitimacy of these payments, the SECP offered a formal defence. The regulator stated that the proposal was approved by its Policy Board under the SECP Act 1997, which it identified as the competent and legally authorised body for making such financial decisions. The SECP further explained that the payments were based on a salary benchmarking exercise carried out by KPMG, one of the world’s leading audit and advisory firms, with the goal of bringing employee compensation in line with prevailing market standards.
On the question of whether approvals were sought from the Ministry of Finance or the Prime Minister’s Office, the SECP firmly maintained that its Policy Board holds the legal authority to approve such expenditures independently under the existing regulatory framework. No external ministerial approval, the regulator argued, was required.
Transparency and Audit Concerns
Despite the SECP’s explanations, questions around transparency remain. The regulator stated that relevant information is shared with oversight bodies, including parliamentary committees, as required by law. However, a significant concern is that the matter has not yet been taken up at the Departmental Accounts Committee level. The SECP did acknowledge that it follows a structured process to address audit observations raised by the Auditor General of Pakistan, but critics argue that the absence of active audit scrutiny on such a large payout is itself a red flag.
Conclusion
The SECP backdated salary payments controversy raises important questions about financial discipline, transparency, and governance within Pakistan’s regulatory institutions. While the SECP has provided legal and procedural justifications for the payments, the scale of the disbursements and the retrospective nature of the approval have understandably drawn public and parliamentary attention. As oversight bodies and lawmakers continue to examine the matter, this case serves as a reminder that even regulatory authorities must remain fully accountable to the public they are meant to serve.
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