ECC approves Rs4.2b PASSCO package

Links compensation to wheat stock disposal

ISLAMABAD:

The government has approved a Rs4.188 billion severance package for employees of the Pakistan Agricultural Storage and Services Corporation (Passco), linking its implementation to the disposal of wheat stocks and third-party validation as part of plans to wind up the state-owned entity.

The Economic Coordination Committee (ECC) of the Cabinet approved the severance package with the stipulation that the entire process would be validated by an independent third party and completed by December 2026.

During discussions at the ECC meeting, Special Assistant to the PM on Industries and Production Haroon Akhtar Khan stressed the importance of third-party validation of the winding-up process.

He also emphasised that Passco's wheat stocks should be disposed of as early as possible to facilitate the timely implementation of the severance package. The Ministry of National Food Security and Research assured the committee that the process would be completed by December 2026.

The ministry briefed the ECC that the PM's Office, through a directive issued on August 26, 2025, had assigned the finance minister to lead the winding-up process of Passco in consultation with the ministry.

Following the directive, a meeting chaired by the finance minister on September 11, 2025 decided that a severance package should be formulated for Passco employees with the approval of the corporation's board of directors, in line with the package approved for employees of the Utility Stores Corporation (USC).

The ministry informed the ECC that the Establishment Division had advised that Passco, being a company limited by shares, was competent through its board of directors to offer a compensation package to its employees in accordance with the applicable rules and regulations. It also recommended that the package be aligned with the Voluntary Separation Scheme (VSS) approved for USC employees.

Accordingly, PASSCO's Board of Directors, in its 156th meeting held on September 23, 2025, approved the aligned and amended severance package for its employees.

The ministry further recalled that the ECC, in its meeting on December 9, 2025, had approved the proposal for winding up Passco and establishing a Special Purpose Vehicle (SPV) named the Wheat Stock Management Company (WSMC) Public Limited.

The decision was subsequently ratified by the federal cabinet on December 23, 2025.

According to the ministry, the proposed package covers regular, contractual and daily-wage employees and includes both severance compensation and terminal benefits.

The terminal benefits comprise leave encashment aligned with the USC methodology, a farewell grant, house rent ceiling and maintenance grants to widows and retired employees from Passco's Benevolent Fund.

The total financial implication of the package has been estimated at approximately Rs4.188 billion, including Rs3.967 billion for severance compensation and terminal benefits for Passco employees, and Rs221 million in maintenance grants for 38 widows and 236 retired employees.