All electricity connections provided to state enterprises - be they federal, provincial or autonomous - would be treated as private connections and liable for disconnection if the bills remain unpaid. This was the outcome of a meeting between the federal finance secretary and his provincial counterparts.
This decision must be hailed as its primary objective is to ensure that electricity bills of federal and provincial governments/departments are promptly paid which, in turn, would ensure that all sub-sectors of the power sector are operating at maximum capacity. At present, one of the major reasons for the massive power outages is attributed to a severe liquidity crisis in the sector that is sourced to inter-circular debt.
Or, in other words, the failure to clear electricity bills by state-owned entities contributes to the failure of the distribution companies to pay what they owe to the generation companies who, in turn, do not have the cash to pay for the fuel that they require to produce electricity.
And last, but not least, this debt leads to the inability of Pakistan State Oil to actually pay for necessary oil imports (crude and refined), thereby compelling the Ministry of Finance, on the instructions of the Prime Minister, to periodically release funds to ensure that imports of this critical product are not compromised - a product whose shortage in an economy has the capacity to bring the entire country to a standstill.
The Federal Finance Secretary revealed that it was also decided that a negative list would be prepared by the provinces which would identify the organisation that would henceforth be treated as 'public consumers' in order to protect them from possible disconnection. And, he added, that it would be the government that would then pick up the tab for all entities on the negative list. There is no doubt that the objective of a negative list is to ensure that critical services are not disrupted as a consequence of the nation's continuing severe shortage.
However, at the same time, it is important to note that exceptions must be made only for those entities that are truly in the public's interest. With public anger mounting as energy shortages continue to disrupt the quality of life of the people of this country third year running it is critical for the federal and provincial governments to ensure that the negative list does not consist of seats of federal or provincial political power but, instead, consist of services that are critical to public welfare. This, by definition, must include public hospitals and dispensaries as well as communication networks (rail, air and telecom).
A Sindh government official introduced another element to the debate on non-payment of energy bills by stating that Sindh has not granted clearance to bills of more than 37 billion rupees unless they are verified first as these bills look inflated and need to be checked. The Federal Finance Secretary added that the federal adjustor is in the process of reconciling the bills by the end of the month.
However, the fact that the bills may be inflated does give cause to many a consumer, private as well as public. As matters stand today, the energy shortage is largely attributable to incompetence as reflected by the failure to eliminate the inter-circular debt almost three years after it was first identified as a major reason behind the energy shortage. Inflated bills raise the prospect of deliberately cheating the consumer which would further erode the public's confidence in the utility's management.
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