One Constitution Avenue needs more than a hotel

The government has taken back One Constitution Avenue and promised a five-star hotel within months. It has also promised refunds, prosecutions and a reformed Capital Development Authority. The hotel is the least important of those promises, and the only one that will be easy to photograph.

The federal cabinet on Wednesday approved the report of a joint investigation team on the twin towers beside Islamabad’s most symbolic road. Planning Minister Ahsan Iqbal said the team had found that the project rested on “irregularity and rigging”, that bidding was manipulated, that a bank guaranteeA promise by a bank to pay if its client fails to meet a contract. condition was removed to help the developers, and that apartments were sold illegally. “The CDA was found complicit,” he said. Interior Minister Mohsin Naqvi said the building was now legally in the government’s possession, and that talks would begin with a large international hotel chain.

This newspaper welcomes the government’s willingness to act where so many before it looked away. Public land was auctioned for one purpose and used for another, and the state went unpaid for years. Nobody should defend that. But an inquiry report is the start of accountability, and the country has seen too many reports that turned out to be the end of it. What the government does next will decide whether this becomes a real reform or simply a change of ownership.

Two decades of looking away

The history is long enough to embarrass almost everyone. The plot was auctioned in 2004-05 for about Rs4.8 billion, for a five-star hotel with serviced apartments. What rose instead were residential towers, with about 250 flats sold to buyers. The CDA cancelled the lease in 2016 and the Islamabad High Court upheld that. In January 2019, the Supreme Court revived the lease on new terms, raising the price to Rs17.5 billion, payable over eight years. The company had reportedly deposited only Rs2.9 billion when the CDA cancelled the lease again in March 2023. On April 30 this year, the Islamabad High Court upheld that cancellation.

Each of those steps had an official signature on it. Regulators approved plans, and courts heard arguments. Meanwhile, the people buying flats included some of the most prominent names in public life, according to the record placed before the High Court. If people with that kind of access could not see the trouble, or chose not to, an ordinary saver had no chance. That should worry the government more than any single developer does.

Publish the report

The first thing the government should do is publish the report, with only what truly needs protecting taken out. Ministers have told the public that named people committed fraud. Those named have not been convicted of anything, and they are entitled to answer. They cannot answer what they have not seen, and the public cannot judge what it has not read. This matters particularly because the report’s conclusions were announced at a press conference, and the National Accountability Bureau has only now been told to act.

There is a reason beyond fairness. The story of this plot has been told in official documents that later turned out to be contested. Flat owners and a bank have challenged the High Court’s ruling, and an intra-court appealAn appeal to a larger bench of the same high court against a decision by a single judge. argues that the 2019 Supreme Court order protected the towers. Mr Naqvi says the building is legally the government’s. He may be right, and the High Court’s judgment supports him. But the government should not behave as if the remaining litigation does not exist. A big hotel chain’s lawyers certainly will not.

The report should also go to the relevant committees of Parliament, where members can ask the CDA how a plot this prominent stayed in dispute through so many governments. The failure was not the work of any one administration. The auction took place under one government and the towers rose under others, and it would be a mistake to treat this as a story about one party or one period.

The hotel can wait. The buyers should not.

The most urgent question is what happens to the people who paid for those flats. Mr Iqbal says their principal will be refunded, with payments adjusted against the Karachi Interbank Offered RateThe benchmark interest rate at which Pakistani banks lend to one another, often used to calculate returns and penalties. “so they do not suffer losses”. Mr Naqvi says that is now binding on the government. Neither has said how much it will cost, how long it will take or who will pay.

Those are the questions on which this exercise will be judged. Residents were given very little time to leave in May. Some are powerful people who will manage perfectly well. Others will have put in their life savings, or a loan, and have been waiting since. They should be given a published timetable and a named office to deal with. They should not have to join a queue behind every other claimant in a case that may last for years.

Taxpayers are owed an answer as well. If the state is refunding buyers who were cheated, the money should be recovered from those found responsible, through the courts, and from whatever a transparent sale of the project brings. It would be a bitter outcome if public land were misused for 20 years and the public then paid the bill.

There is also a question of sequence. The investigators themselves recommended that the project be re-auctioned in a transparent manner, with security clearances and fire safety checks. That is sensible. It also sits uneasily with talk of converting two residential towers into a five-star hotel “within months”. Rooms built as apartments do not become an international hotel by decree, and no serious operator will sign before the title is clean. Islamabad may well need more hotel rooms. It needs a clean process more. Rushing a deal to produce a ribbon-cutting would be the quickest way to create the next One Constitution Avenue.

The real test is the CDA

The most valuable part of what Mr Iqbal announced got the least attention. The team recommended overhauling the CDA and its ordinance, creating an independent master plan commission, digitising records and rotating officers between planning, enforcement and building control every two years. “People have held offices for 20 years and opened offices of fraud,” he said.

Those are the right ideas, and they should not join the long list of Pakistani reforms announced after a scandal and forgotten after the next one. The government should set dates for each of them and report on progress to Parliament. Digitised land and lease records should be open to the public, so that a family thinking of buying a flat in Islamabad can look up in minutes whether a developer’s lease is valid, whether its dues are paid and whether its plans match what was approved. That one step would do more to protect the next buyer than any number of joint investigation teams.

The authority also needs to be held to the same standard everywhere. One Constitution Avenue is the most famous case because of who lived there. It is unlikely to be the only building in the capital where approved plans and reality have drifted apart. If the new rules apply only to towers in the headlines, people will reasonably conclude that this was about those towers and not about the rules.

A lesson for the courts of public opinion

Those who defended the residents in May were right about one thing: people should not be turned out of their homes at a few hours’ notice, whatever the legal position. Those who cheered the eviction were right about another: nobody should get to keep public land because they are important. The government’s decision to refund buyers while reclaiming the land recognises both points. That is to its credit.

It will deserve more credit when the refunds arrive, when the accused have had their day in court, and when the next plot of public land in Islamabad is auctioned with its terms and payments on a public website. A five-star hotel on Constitution Avenue would be a fine thing for the capital. A CDA that can no longer lose track of a 13.5-acre plot and more than Rs14 billion in reported unpaid dues would be a far better one.