Cabinet approves restructuring of 8 public enterprises
ISLAMABAD: The federal cabinet on Wednesday approved the restructuring of eight major public sector enterprises (PSEs), which include the Pakistan International Airlines (PIA), Pakistan Steel Mills (PSM), Pakistan Electric Power Company (PEPCO), Pakistan Railways (PR), National Highway Authority (NHA), Pakistan Agricultural Storage and Services Cooperation (PASSCO), Trading Corporation of Pakistan (TCP) and the Utility Stores Corporation (USC).
“The decision will bring about financial discipline and is aimed towards revival and good governance,” said the cabinet, which met with Prime Minister Yousaf Raza Gilani in the chair. The meeting considered a report of the cabinet Committee on Restructuring (CCOR) of PSEs — constituted on December 16, 2009 in pursuance of decision to introduce austerity measures — that had recommended that the enterprises be saved from billions in losses.
The PM told the cabinet meeting that it was “imperative to devise ways and means to stop the ill-management and lack of commitment which had resulting in massive losses of public funds”, adding those lost funds could have been used for the development of the country and the welfare of the people.
“The better management of these PSEs through restructuring would create fiscal capacity to provide relief to the masses. The objective of restructuring should be to improve the performance of the PSEs and reduce its burden on the national exchequer,” Gilani said.
The cabinet expressed its resolve to optimise the functional ability of PSEs and emphasised that the enterprises had a “critical significance not only for the national economy but also for better living standards of all segments of society”.
Independent board: The meeting also announced a road map to reconstruct ill-managed enterprises, which said that an independent and professional board of directors (BoD) would be formed in each PSE by April 30.
“Under the given roadmap, professional CEOs (nominated by the respective BoDs) would be hired by June 15. The CCOR would approve the restructuring plans of respective PSEs by August 31,” the meeting decided.
It was also decided that the formation of an independent and professional BoDs and appointment of CEOs would be proposed by the Finance Ministry in consultation with the CCOR and that the restructuring plan would be presented by each ministry to the cabinet for its decision.
The PM, in his opening remarks, directed the Cabinet Division to submit a progress report on the implementation status of cabinet decisions in the next cabinet meeting.
He also directed that recommendations of the 19 cabinet sub-committees should also be submitted in the next meeting.
Source: Daily Times