Govt gives Rs120 bn to power sector
Mehtab Haider
ISLAMABAD: The federal government released Rs120 billion to the power sector to clear backlog of piled up subsidies of the last financial year 2009-10 that would now help generate around 2,000 megawatt (MW) electricity at a time of existing shortages of 7,200 MW, it is learnt.
“We have made hectic efforts to reconcile the figures of cash-strapped power sector and decision has been implemented to clear backlog of Rs120 billion of last financial year which was already released to refineries as well as to PSO and other players of energy sector. It will help generate around 2,000 MW electricity at this stage of severe crisis of power outages,” a senior official of Gilani government confided to ‘The News’ in background discussions here on Wednesday.
The government, the official said, has taken decision in principle to convert liabilities placed under Power Holding Company as well as piled up through commodity operation into prime security which means that the government would show these liabilities on its balance sheet instead of earlier practice to put these liabilities treating as off balance to avoid showing real picture on fiscal deficit side.
The fiscal deficit may go up for the outgoing fiscal year or next year but it is not yet known how the authorities are going to convince the IMF and other multilateral creditors for tackling this issue.
On other hand, the torturous load shedding has made the lives of common citizens extremely miserable as it hovers in the range of 12 to 18 hours in different parts of the country.
The authorities of energy sector conceded that the primary originating source of the circular debt was Pepco’s payables which were again showing ballooning picture. Despite the fact the provinces got the lion’s share through transfer of resources under 7th NFC Award, all provinces including Punjab were again in the list of defaulters as liabilities of provinces jumped up to around Rs89 billion. The other major contributor to the circular debt is KESC as its tariff differential subsidy this year is touching Rs40 billion. As per court order these monthly fuel oil adjustments cannot be passed on to consumers, resulting into accumulation as circular debt.
Even Pepco’s receivables from private consumers on December 31, 2010 stood at Rs69.691 billion as over three years running defaulters outstanding due amount stood at Rs45.260 billion but did not face disconnection.
There are outstanding amount of Rs9.055 billion against those defaulters who had not paid bills of last one to 3 years. There are also defaulters in different Discos who have not deposited bills of Rs3.418 billion for the last 6 to 12 months. The outstanding amount of private consumers from 3 to 6 months stood at Rs5.456 billion, from 3 months at Rs825 million and from 2 months at Rs5.677 billion.
Source: The News
Date:5/5/2011
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