The government has announced the formation of a four-member committee aimed at assessing the legal status and fiscal implications of state-owned enterprises (SOEs) not governed by the SOEs Act of 2023.
This decision emerges amid concerns over the financial risk posed by these large entities to the federal budget.
The committee, under the leadership of the Additional Secretary of Corporate Finance, includes prominent members such as the director-general of the Central Monitoring Unit (CMU) for SOEs, Legislative Adviser Law & Justice Hassan Mehmood, and the Executive Director of the Securities and Exchange Commission of Pakistan (SECP), Mubasher Saeed.
This initiative follows the introduction of the SOEs Governance and Operations Act 2023 in January of the same year, which aimed to increase oversight and ensure the financial health of the majority of SOEs as mandated by the International Monetary Fund (IMF).
Despite this legislative step, a significant number of entities established under specific acts of parliament remain outside the ambit of this law, necessitating a thorough legal review.
The government’s move to establish the CMU, although delayed, signifies a commitment to adhere to the SOEs Policy required by the 2023 Act.
This policy mandates regular financial monitoring of SOEs, especially focusing on 85 larger entities.
Recent directives from the Ministry of Finance have underscored the limited fiscal autonomy of various ministries and their associated SOEs, aligning them with the broader objectives of fiscal responsibility and regulatory compliance.
Furthermore, in alignment with IMF recommendations, the caretaker government has already revised laws pertaining to four major SOEs — the National Highway Authority, Pakistan Post, Pakistan National Shipping Corporation, and Pakistan Broadcasting Corporation — to bring them under the scope of the SOEs Act 2023.
These amendments are part of a broader effort to ensure that SOE operations are commercially viable and governed by robust corporate governance principles, as outlined in the new act.
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