A new audit by the Auditor-General of Pakistan (AGP) has raised serious concerns over the National Highway Authority’s (NHA) Rs12.2 billion Electronic Toll Collection (ETC) project. The report says missing systems and weak financial controls have put the authenticity of more than Rs39 billion in motorway toll collections at risk.
The audit covers the financial years from 2022-23 to 2024-25. It found that NHA awarded the project to the Frontier Works Organization (FWO) through direct contracting. However, the authority did not fully meet the Public Procurement Regulatory Authority (PPRA) rules. It also noted that major parts of the project remain incomplete almost three years after the deadline.
NHA approved the project in May 2022 with an eight-month completion target ending on March 28, 2023. By June 2025, it had paid Rs10.75 billion, nearly 88 percent of the contract value. However, the Automatic Vehicle Classification (AVC) system has still not been installed.
According to the audit, the missing AVC system prevents independent verification of vehicle categories and toll transactions. As a result, toll collections worth Rs39.38 billion between July 2022 and June 2025 cannot be fully verified.
FWO blamed the delay on import restrictions during 2022-23. The company said it could not import German-made AVC sensors worth about Rs1.4 billion. It has proposed alternative technology, which NHA is still reviewing.
The AGP also questioned the transparency of toll collections. It said NHA did not hire an independent organization, such as NADRA or NIFT, to verify real-time traffic and revenue data. In addition, NHA lacked complete motorway-wise toll records, escrow account details, and revenue-sharing data.
The report also found that FWO held Rs3.5 billion in toll collections for up to three months before transferring the funds to NHA. Despite the delay, the authority did not impose contractual penalties.
Auditors also questioned Rs3.12 billion paid for operations and maintenance services. They said no verified records confirmed services such as firefighting, road maintenance, rescue operations, and IT support.
The audit further revealed that NHA failed to maintain records of unused M-Tag advances and made little progress on the planned Pak-Tag system. It also noted that FWO did not provide the mandatory Rs500 million toll revenue security.
The AGP concluded that the ETC system has automated toll collection on six motorways. However, the project remains incomplete because the AVC system is still missing. The report recommended installing the AVC system immediately, appointing an independent auditor, enforcing contract terms, recovering penalties, and speeding up the Pak-Tag project to improve transparency and protect public revenue.
