Energy woes: Govt to go ahead with Discos sell-off plan

CCI takes decision after provinces refuse to take ownership; approves ‘diagnostic analysis’ of NEPRA.

ISLAMABAD:

The Council of Common Interests (CCI), the top constitutional decision-making forum between the federation and federating units, has decided to privatise all electric power distribution companies (DISCOs) after the provinces refused to take ownership of their respective utilities.

The decision was made at the 25th meeting of the CCI on Monday after a summary proposing takeover of DISCOs by provincial governments was rejected by most participants.

“The government has very limited resources to bear losses of state enterprises,” Prime Minister Nawaz Sharif said. “In the past, unnecessary recruitments and corruption has resulted in the mismanagement of these organisations and therefore, in the national interest, privatisation is the only solution,” he said, according to a statement issued after the meeting.

Governance is a collective responsibility and all the provinces have to work in tandem, the premier added. “It was decided by the CCI to continue with 2011’s policy regarding the privatisation of power sector entities i.e. DISCOs and GENCOs [power generation companies].”



“After the CCI decision, the power distribution companies would be privatised,” confirmed Privatisation Commission Chairman Muhammad Zubair.

The prime minister chaired the meeting that was attended by the chief ministers of Punjab, Sindh, Khyber-Pakhtunkhwa and Balochistan. The meeting took place after a gap of over 190 days as the last meeting took place on July 31, 2013. The body, as per under Article 154 of the Constitution, is required to meeting after every 90 days.

During Monday’s meeting, it was reported that some provinces refused to take the ownership of DISCOs that led to the decision to privatise them, while the proposal of others was rejected.

Sindh had initially opposed the idea of privatising DISCOs but changed its stance when it was asked to take responsibility during the meeting. Balochistan, however, did not comment on the issue, officials claim. Punjab and the Centre will have the same opinion, he added.

On the other hand, Khyber-Pakhtunkhwa also sought control of GENCOs along with DISCOs, but the proposal was rejected.

The CCI also expressed its dissatisfaction over National Electric Power Regulatory Authority’s (Nepra) performance and it was decided that a ‘diagnostic analysis’ be conducted to improve its performance.

The Council also approved the National Energy (Power) Policy 2013-2018, Pakistan Engineering Council (Amendment) Bill 2013, issuance of the sovereign guarantee for the Thar coal-mining project and decided to expedite the transfer of properties to the Pakistan Telecommunication Company Limited (PTCL) so that $800 million in revenue could be recovered.

Regarding the purchase of 20% shares of the Pakistan Petroleum Limited (PPL), Oil and Gas Development Company (OGDCL) and Sui Southern Gas Company Limited (SSGCL) at their face value under the Aghaz-e-Haqooq-e-Balochistan, the prime minister directed the finance division to hold detailed consultations with the provinces.

Moreover, the Ministry of Water and Power was directed to hold meetings with all the provinces to discuss and decide upon the mechanism for at-source deduction of outstanding power sector payables of the provinces.

No mention of the census

Even though the prime minister had given the green signal for a fresh population survey in the country, the issue was not tabled in the CCI meeting, an official told The Express Tribune.

In December last year, the premier had endorsed the sixth census plan after wading through two summaries, one by the Inter-Provincial Coordination (IPC) division and the other by the Election Commission of Pakistan (ECP).

However, the poor law and order situation in the country could be one of the factors, which delayed the overdue census, said the official.

Published in The Express Tribune, February 11^th, 2014.