PAC to probe into polymer note 'scandal'

Public Accounts Committee (PAC) under Legislature-Parliament is investigating on bribe scandal of the polymer notes.
The committee today also directed the central bank and Finance Ministry to submit the 'dumped' report within three days.
After complaints of the quality of Rs 10 denomination polymer notes in 2007 from the Australian agency, the central bank had prepared a report but 'dumped' it without taking action against those involved in the 'corruption'.
The PAC members asked for serious investigation on the bribe 'scandal' that came into light after the Australian newspaper 'The Sydney Morning Herald' broke the news about the corruption in Australia and started investigation.
In 2002, when the Polymer notes were planned to be issued, the central bank has convinced the common people saying that paper money is easy to counterfeit — 97 per cent of fake banknotes are paper— and has a circulation life of about eight months at the most. But the polymer has longer life and difficult to counterfeit.
"Worn notes also cause more errors in ATMs and high-speed note validators," it had justified, adding that the need of bringing the Polymer notes that the high cost of replacing high-circulating, low-denomination paper currency often takes the lion’s share of any reserve bank’s budget at around Rs 100 million.
Nepal was the 21st country to make polymer notes.
After a hard lobbying with politicians and central bank, Note Printing Australia (NPA) — a subsidiary of the Reserve Bank of Australia — won a tender worth $1.64 million to produce 50 million worth Rs 10 denomination currency notes.
Polymer banknotes were, though, expensive — as they cost almost twice the amount of paper — it had guaranteed longer circulation life that could have ssaved budget of the central bank. But the NPA was proved wrong immediately after Nepal received the first batch of the polymer notes as they worn out as fast as the paper currency notes.
Though, the Australia's central bank yesterday dismissed 'unwarranted' media reports that board members had known about an Asian banknotes bribery scandal involving one of its companies as early as 2007, the case has now came under scanner in Nepal.
One of the Australian newspaper Fairfax reported that senior Australian central bank figures failed to alert police to claims that agents from Note Printing Australia (NPA) were involved bribing officials in Nepal.
The allegations were brought before the NPA board, of which a number of Reserve Bank of Australia (RBA) officials were members, in mid-2007, according to the newspaper, 'but the bank decided to handle it internally.'
RBA said NPA's board was alerted to 'serious deficiencies in the practices and controls related to the use of sales agents' after commissioning an audit in 2007. Nepal Rastra Bank, though, tried to investigate but dumped the case afterwards.
However, skeletons started to come out of the closet after the Australian newspaper reported it this week. The Nepal Rastra Bank and anti-graft watchdog both are in fix for their suspicious role in the scandal. But PAC's directive might bring those involved out to open after almost a decade.