Reorganisation of 7 SOEs faces hurdles
The cabinet has allowed the Ministry of Industries and Production to give additional roles to government officers for vacant posts of CEO or managing director of stateowned enterprises (SOEs) until the appointment of new heads.
The permission was given in relation to those SOEs that had either been merged, made autonomous or were being privatised. During discussion in a cabinet meeting, the industries and production secretary highlighted the difficulties in the way of implementing recommendations of the Institutional Reforms Cell.
It was pointed out that the Institutional Reforms Cell had not fully considered the reorganisation of SOEs as per the terms of reference (TORs), which, therefore, was causing difficulties in its implementation.
As per the TORs, the implementation committee was required to work out an implementation strategy and work plan by taking into consideration different aspects, which included cost-benefit analysis of the entities concerned, expected outcome of proposed transformation with reference to service delivery, constitutional and legal ramifications and issues pertaining to terms and conditions of civil servants.
The adviser to prime minister on institutional reforms and austerity told the cabinet that out of the planned reorganisation of 441 entities, only seven were encountering implementation problems, which was a small percentage.
He told the Industries and Production Division to bring the issue to the Cabinet Committee on Institutional Reforms for resolution.
The Cabinet Division secretary revealed that necessary notifications for the reorganisation of 333 entities had been issued after cabinet’s approval.
For clarity, amendments to the Rules of Business would be made once the process was completed. The Industries and Production Division pointed out that the cabinet, in its decision taken on December 23, 2019, had given directives to liquidate the Aik Hunar Aik Nagar; transfer Pakistan Machine Tools Factory to the Strategic Plans Division; transfer Enar Petrotech Services to Oil and Gas Development Company, Petroleum Division; transfer NFC Institute of Engineering and Technology, Multan and NFC Institute of Engineering and Fertiliser Research, Faisalabad to the Federal Education and Professional Training Division; and merge National Fertiliser Marketing Limited with Trading Corporation of Pakistan.
The cabinet also directed that Karachi Tools, Dies and Moulds Centre, Furniture Pakistan, National Industrial Parks Development and Management Company, Technology Upgradation and Skills Development Company and Industry Facilitation Centre may be merged with Pakistan Industrial Development Corporation (PIDC). Additionally, Gujranwala Business Centre should be merged with PIDC, subject to concurrence of the Gujranwala Chamber of Commerce and Industry.
Furthermore, the Cabinet Division on April 14, 2020 called for declaring several SOEs as autonomous bodies, under the administrative control of various divisions. Besides, the Cabinet Division on May 7, 2020 communicated that four SOEs, under administrative control of the Industries Division, had been placed on active privatisation list and 11 others were picked for privatisation/ placement under Sarmaya-e-Pakistan. Owing to these decisions and to ensure their efficient implementation, there was a need to have heads of state organisations.
However, it was impractical for the Industries Division to appoint from the private sector the regular chief executive officers (CEOs)/ managing directors of SOEs, which were being transformed.
The problem was compounded by the lack of willingness on the part of eligible private sector candidates, given the wavering fate of the organisations concerned.
Besides, the division had the responsibility to ensure transparent transfer/ merger/ liquidation/ privatisation of the organisations, which fell under its ambit.
In the absence of heads of the SOEs, the ministry might not be able to supervise or fix responsibility in case of any lapse during the transition period.
In light of comments and observations of the Establishment Division and PM adviser on institutional reforms, and subsequent decisions of the cabinet, a revised summary was drafted.
The Industries Division told the cabinet that for the SOEs falling in Category A - those which were to be retained as autonomous bodies - the additional charge of CEO/ MD may be assigned till the appointment of a regular CEO/ MD. Furthermore, for the SOEs falling in Category B, which were to be merged/ transferred/ liquidated/ privatised, the additional charge of CEO/ MD may be assigned till the process of restructuring was completed.