AG, law ministry asked to file reference in SC: Whether MPs can represent boards of PSEs?

ISLAMABAD: Federal Cabinet has directed Attorney General and Minister for Law & Justice to immediately file a reference in the Supreme Court, under Article 186 of the Constitution, to get clarity as to whether elected members could represent the Boards of public sector entities, official sources told Business Recorder.

This issue resurfaced at a recent meeting of Federal Cabinet when a proposal regarding resignation of Minister for Energy, Hammad Azhar as Chairman of the Boards of Power Division's organizations came up for discussion.

The Power Division briefed that Omer Ayub Khan, the former Minister for Energy (Power Division), tendered his resignation from the chairmanship of the Alternative Energy Development Board (AEDB), National Energy Efficiency Conservation Authority (NEECA) and Private Power Infrastructure Board (PPIB) on September 11, 2020 and the Federal Cabinet approved the said resignation on the basis of a summary of the Power Division.

Subsequently, when Muhammad Hammad Azhar assumed the portfolio of Energy on April 17, 2021, on his direction, Power Division requested advice of the Law & Justice Division as to whether such service of the Minister for Energy (Power Division) as Chairman of PPIB and NEECA Boards, on the basis of statutes of PPIB and NEECA, would come within the meaning of service of Pakistan. Law Division had replied that membership as Chairman of the Boards of PPIB or NEECA would amount to 'service of statutory body'.

Based upon the clarification of Law Division, Muhammad Hammad Azhar had also tendered resignation as Chairman of NEECA & PPIB. However, after assuming the portfolio, Muhammad Hammed Azhar had not performed any function of Chairman NEECA or Chairman PPIB, except allowing Secretary Power Division to chair the meetings of PPIB Board on account of operational requirement.

The Cabinet was informed that PPIB and NEECA were statutory bodies established under Private Power & Infrastructure Board Act, 2012 (PPIB Act) and National Energy Efficiency Conservation Act, 2016 (NEECA Act).

The relevant provisions of the Acts are as under: (i) According to Section 6(1) (a) of PPIB Act 2012, the Minister for the erstwhile Ministry of Water and Power (Now Ministry of Energy Power Division) was the Chairman of the PPIB Board. Section 8 (1) of the aforesaid Act provided that the meetings of the Board should be presided over by the Chairman and in his absence, a Member designated by the Chairman should preside over the meeting of the Board; and (ii) according to Section 3(1) (a) of NEECA Act 2016, the Federal Minister of the Division to which subject matter of this Act stand allocated was the Chairman of NEECA Board. Section 3 (5) of the aforesaid Act provides that meeting of the Board should be presided over by the Chairman of the Board or, in his absence, by the Vice Chairman or in his absence by any Member elected by the Board.

The Cabinet was further apprised that the Minister for Energy was the Chairman NEECA and PPIB Boards in his ex-officio capacity and hence amendments in the PPIB and NEECA Acts might be required. Such amendments for PPIB Act had already been submitted to CCLC. A similar amendment in NEECA Act was being drafted and would be submitted to the competent forum in due course.

The positions of Chairmen of these statutory organizations were critical, as all strategic and operational decisions in these organizations were taken at the Board level under the relevant statutes and as such holding of regular meetings of the Boards in these organizations was essential in the public interest; the following proposals were submitted as interim arrangements in view of the need to hold Board meetings of these organizations: (i) resignation of Muhammad Hammad Azhar, Minister for Energy (Power Division) from his position as Chairman NEECA and Chairman PPIB might be accepted with effect from September 16, 2021; and (ii) Federal Cabinet, using the powers of the Chairman may allow Secretary, Power Division, in terms of Section 8 (1) of the PPIB Act to preside over the meetings of PPIB Board and exercise other powers of the Chairman from the date of resignation of Muhammad Hammad Azhar, Minister for Energy, till amendment of the PPIB Act.

During discussion, the members recalled that the Cabinet had approved filing of a Reference to the Supreme Court, under Article 186 of the Constitution, to get clarity as to whether the elected members could represent the Boards of the public sector entities, which had not been done so far.

The sources said, Cabinet approved the summary of Power Division, meant to approve resignation of Hammad Azhar and give powers of Chairman of Boards of PPIB, AEDB and NEECA to Secretary Power Division.

The Cabinet also directed the Attorney General and Minister for Law & Justice to immediately file a reference in the Supreme Court, under Article 186 of the Constitution, to get clarity as to whether the elected members could represent the Boards of the public sector entities as Parliamentarians were very keen to be Members of Boards of Public Sector Companies and organizations situated in their respective constituencies.

However, both the Ministry of Law and Attorney General for Pakistan maintained that public representatives cannot become members of boards of any public sector entity.

Copyright Business Recorder, 2021