Power sector: Outstanding receivables reach alarming Rs587b

Figure may have crossed Rs600b by January-end.

LAHORE: It looks like the flamboyant claims of the government to speed up the recovery of bills are hollow as outstanding power sector receivables have soared to Rs587 billion.

According to official documents, the total power receivables as of November 2014 stood at Rs587 billion, the highest receivable figure in the history of the power sector.

“These are the official figures till November 2014, but if we count the receivables as of January 2015 (which officially are not out) then this figure will easily cross the Rs600-billion mark,” said an official of the water and power ministry.

As per documents, total receivables from private consumers of all the distribution companies and FATA (excluding K-Electric) stand at Rs402 billion. K-Electric’s dues as of November 2014 stand at Rs32 billion.

After taking the office back in June 2013, the current government took drastic steps for power sector reforms. The first and immediate step was to clear the payables of power producers, Pakistan State Oil and other concerned departments. In this regard, the finance ministry cleared Rs480 billion.

The other step was to tighten recoveries from clusters where the percentage of bill collection was very low. This step was taken to reduce the gap between payables and receivables, but no major success has been observed till date especially from the targeted areas.

The federal and provincial departments are also leading the race in default as out of the total figure, Rs153.14 billion are due by federal, provincial and the Azad Jammu and Kashmir governments.

The Ministry of Water and Power, which currently is handling most of the power issues, is also defaulting Rs1.9 billion as of November 2014.

Breakdown of debt

For the first five months of the fiscal year 2014-15, the total billing to all federal government departments was Rs20.59 billion, whereas the collection stands at Rs18.1 billion. The previous fiscal year receivables were Rs6.1 billion, which makes the outstanding billing to Rs8.6 billion till November 2014.

Azad Jammu and Kashmir departments owes Rs45.703 billion and paid Rs1.58 billion in the first five months against dues of Rs9.314 billion. Remaining dues of Rs37.91 billion was carried forward from the previous fiscal year.

In other provinces, Sindh government is leading in terms of total payables. In the first five months of current fiscal, total collection from Sindh government departments was at Rs3.26 billion against the billing of Rs12.053 billion. Total receivables from the Sindh government stands at Rs65.14-billion mark.

Khyber-Pakhtunkhwa government is at second place with total outstanding dues of Rs20.93 billion. The first five month collection of KPK government was Rs2.092 billion against the billing of Rs3.158 billion.

Balochistan’s total payables stands at Rs7.63 billion, whereas Punjab governments total payables as of November 2014 stands at Rs5.152 billion mark.

Published in The Express Tribune, February 5^th,  2015.

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