Who was behind Pepco dissolution?

The Pakistan Electric Power Company's (Pepco) dissolution plan had reportedly been tailored by a group of anti- Pepco MD Tahir Basharat Cheema group, led by the recently retired Secretary, Water and Power, sources privy to this development told Business Recorder.
The group comprised Energy Advisor, Water and Power Ministry, (who resigned at the same time as the retirement of the Secretary), Deputy Chairman of Planning Commission, a representative of KESC holding company, and World Bank officials. "This plan was prepared to sideline Tahir, who was not only resisting setting up four new rental power plants (RPPs) but was also insisting that heavy penalties be imposed on those projects which received millions of dollars as 14 percent advance payment, and yet failed to start commercial operations," sources said.
The group drafted the plan and submitted it to the World Bank and Asian Development Bank (ADB) for support, without prior consultations with the stakeholders. Sources added that the group convinced the Minister for Water and Power, Pervez Ashraf, that Cheema should be sidelined as he was a thorn in the implementation of power sector reforms as desired by the Ministry.
On October 1, 2010, the Minister announced dissolution of Pepco under power sector reform programme, agreed with the international financial institutions (IFIs). He also announced a three-member steering committee under his control to oversee the transition of the entity. Sources said that the Minister for Water and Power had a grudge against the Pepco MD, who was resisting his orders relating to transfers and posting as well as setting up of new RPPs. A spokesman to the Minister, Tanveer Alam, however, has denied this.
Sources said that the government had decided to wind up Pepco not later than October 31, 2010, seemingly in the light of a decision taken by the Economic Reforms Unit (ERU) which, according to the minutes, did not specify any date. "No consultation ever took place with regard to the fate of the now defunct Pepco," sources added.
The implementation plan proposed in the meeting of July 15, 2010, presided over by the Deputy Chairman of Planning Commission, Dr Nadeemul Haq focused on ensuring efficiency in fuel use, and financial/governance measures which would then be examined by the two IFIs. According to the plan, World Bank and ADB would firm up their response on this action plan of the Ministry of Water and Power with a review of the time limits proposed.
"Any implementation plan firmed up without due consultative process and then seeking response from the ADB and the World Bank on its own will not serve any purpose," sources quoted Pepco as stating in response to the 'plan' prior to its implementation.
The government's decision regarding winding up of Pepco has been termed 'unwise' by several economic analysts. The decisions/recommendations of Cabinet Committee on Restructuring will amount to rolling back the entire reform process, disturbing the firewall between the owners and management and the danger that the sector may be exposed to more political interference in the management of day to day affairs of the companies.
"If the Minister and the ex-Secretary had any differences with the Pepco MD, they should have replaced him with another, instead of demolishing the whole organisation," commented another official. According to him, about 150 employees of the organisation are worried about their future, as no strategy has so far been prepared by the Ministry of Water and Power in this regard.
Unconfirmed reports also suggest that Pakistan International Airlines (PIA) has also refused to issue air ticket to the Pepco high-ups after the news appeared in the media about winding up of Pepco. An e-mail was sent to the World Bank's Islamabad office for comments over the alleged involvement of its officials in tailoring Pepco 'demolition plan' with connivance of other officials of the Ministry. However, no response was received till the filing of this report.