Details on circular debt sought

Senate panel also recommends slashing workforce in govt-owned power generation companies

Our Correspondent August 06, 2021


The senate standing committee on power has observed that the number of employees in government-owned power generation companies (Gencos) have exceeded their need and recommended a cut down on the workforce, adding that doing so would lighten the burden on the national exchequer.

A meeting of the senate panel, held on Thursday, under the chairmanship of Senator Saifullah Abro also reviewed the circular debt plight and directed the Power Division (Ministry of Energy) to submit a complete breakup of where and how much was spent. It also sought details of factors contributing to circular debt.

The committee chairman said that circular debt was increasing due to failure of Hyderabad Electric Supply Company (Hesco) and Sukkur Electric Power Company (Sepco) in recoveries of arrears. He said that these companies were not interested in the recoveries especially from the police department as they are scared of the uniform.

Beside these companies are also not taking action against electricity theft by Sindh Police. He once again reiterated his earlier claim that Sindh police colonies were involved in electricity theft.

The meeting commenced with a review of implementation status of recommendations made in the previous meeting. Abro took strict notice of the late submission of working papers.

While being briefed about the aims and objectives of establishment of Genco Holding Company Limited (GHCL) along with details of achieved targets, the committee was informed that the main reason for the establishment of these companies was to enhance capital formation for power sector development out of the budget of the government of Pakistan. This would improve efficiency of the power sector through competition, accountability, managerial autonomy, and profit incentives and would rationalise prices and social subsidies.

This led to business transfer agreements with four Gencos at that time (GENCO 1, 2, 3 and 4). Currently, the power sector boasts of four Gencos. The Committee discussed each Genco’s performance in detail.

Observing trends, the committee opined that human resource exceeded the need of each Genco. Except for Genco 1, the committee showed reservations regarding the performance of the three Gencos. The committee recommended a cut down in this area and said that doing so would lighten the burden on the national exchequer imperative for growth. Details of capacity utilisation were also sought.

While discussing the Lakhra Power Plant, the committee inquired about the recommendations made by the sub-committee and directed the ministry to submit its implementation report. The senate panel also inquired whether those recommendations were submitted to the cabinet prior to the de-licensing of the power plant.

The committee chairman was of the view that aims and objectives for the creation of Gencos were not fulfilled. He added that every measure must be taken to save our national assets. He said that this will ensure the revival of our enterprises essential for the prosperity of Pakistan.

Reviewing details of board of directors of all the concerned companies, the committee was briefed about the selection process. In this regard, Abro gave directions to the companies to submit the resumes of the BODs of their companies for further review.

Published in The Express Tribune, August 6th, 2021.

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