ISLAMABAD: Caretaker Federal Finance Minister Dr. Shamshad Akhtar has said that the federal government has formed a cabinet committee on State Owned Enterprises (SOEs) to improve the performance of loss making government owned companies.
In a media briefing on Thursday, the caretaker Finance minister said that the government has designed a policy structure with respect to the loss-making State owned Enterprises (SOEs).
The caretaker FM said that the loss making SOEs are being restructured explaining she said that under the proposed policy, Chief Executive Officers and board members shall be appointed independently besides the members will also be given security of tenure and the appointment of the CEO will also be reviewed.
In addition, ad-hoc interventions will be prohibited, preventing ministries from issuing directives to SOEs.
She added that any exemptions from PPRA Rules will be granted upon due approval of the federal cabinet, and all organizations shall maintain electronic financial data.
She said that companies have an important and historical role in the country’s development as SOEs provide services in those areas where the private sector is reluctant to do so.
Presently, there are 18 financial SOEs including 4 Industrial and State Development and Management, 12 infrastructure, transport and ITC, 14 manufacturing, mining and engineering, 8 in oil and gas, 20 in the Power Sector and 4 in the Trading and Marketing Sector.
In the fiscal year 2019, the total tax revenue of all SOEs were about Rs 4000 billion while the book value of their assets recorded Rs 19 thousand billion whereas these SOEs are providing employment to 0.450 million employees.
She said that the loss of government-owned SOEs have exceeded Rs 500 billion in the year 2020 which was Rs 143 billion in the year 2019 adding that she said that the Ministry of Finance has also been providing assistance in order to keep many SOEs in good condition.
She disclosed that the top ten loss making SOEs in 2019 including Quetta Electric supply company Rs108.5 billion, National Highway Authority Rs94.3 billion, Pakistan Railway Rs0.2 billion, Sukkar Electric power company Rs40.8 billion, Pakistan International Airlines 36.07 billion, SSGCL Rs21.4 billion, Pakistan Steel Mills Rs20.6 billion, HESCO Rs17.7 billion, Pakistan State oil company 14.8 billion and Peshawar Electric supply company Rs14.6 billion.
On the other hand, the top ten profit making SOEs including Oil and Gas Development Company limited Rs100 billion, Pakistan Petroleum limited Rs49.4 billion, National Bank of Pakistan Rs30 billion, Government Holdings private limited Rs28.8 billion, National Power Parks managment Rs28 billion, Port Qasim Authority Rs15 billion, National Transmission and despatch company 9 billion, Pakistan Kuwiat company Rs6.3 billion Faisalabad Electric supply Rs6 billion and Pakistan Agriculture storage Rs.02 billion.
She dubbed lack of merit in appointments are the main reason for the loss of government companies and the finance ministry has been bailing out these companies from the financial crisis.
She said that a series of measures are being taken to revive the economy and we will continue the good initiatives taken in the past with regard to SOEs.
To a question, she replied that the ownership of strategic institutions will remain with the government, but other institutions will be gradually privatised in a transparent manner.