Experts gathered to weigh the pros and cons of privatising 32 enterprises expressed divergent views about selling profitable firms.
While some favoured the decision, others argued that restructuring public enterprises could prove to be favourable for the economy at a discussion titled, “Privatisation of Private Enterprises,” at Jinnah Institute on Thursday evening.
While 2 million people or 1.8% of the population pay direct income tax, Economist Dr S Akbar Zaidi was of the view that restructuring and strengthening the tax collection institution was more crucial to income generation and privatisation was not the only solution.
Zaidi said the government must segregate loss-making companies which should first be restructured. “The government does not have to fix and sell, they can also fix and keep it.”
Zaidi said lessons must be learnt from privatisation deals in the past and mistakes must not be repeated. “There are ways of doing it, it has been done in the past and globally experimented, large corporations today with extremely conservative governments have been successfully retained in the public sector. “Neither Ishaq Dar nor Prime Minister Nawaz Sharif know how to go about it.”
Senator Saleem Mandviwalla, former chairman Board of Investment, said the problem lay in providing quality management. He suggested that some enterprises which had the potential to be rejuvenated through joint ventures, outsourcing and even public-private partnerships that would generate greater profits should be retained. “Many can be turned around.” Everyone wants a piece of the privatisation pie,” he added.
While discussing the political dilemma, Mandviwalla said that privatisation has always been on the agenda of governments, however the present government lacked political will and a clear road map. He said that debate on the subject has been brought up in both houses of the parliament, but no minister has turned up to answer questions. “It has been nine months and no one has come up with any answers.” If the government is not serious about showing up in parliament, then what are they serious about?” he questioned.
NUST Dean Dr Ashfaque Hassan Khan suggested that the board must be apolitical and consist of reputable representatives.
Dr Ashfaque was of the view that profitable companies should not be privatised and regulatory bodies needed to be strengthened.
Dr Akhtar Hassan Khan, former planning secretary said the country was going through an economic turmoil and confronted with several security challenges.
Academic and political activist, Dr Aasim Sajjad Akhtar argued the privatisation debate should include the government’s responsibility to provide public goods to its citizens.
Asad Zaman said that there was no empirical evidence that goes on to show that privatisation is preferable to government ownership public enterprises. While Dr Aliya from Quaid-i-Azam University said that social dimensions and labour concerns must be looked into. “The government is not interested in labour dynamics.”
Published in The Express Tribune, February 21st, 2014.
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