Staff, bigwigs and institutions: MoF urges PD to cut off supply of free electricity immediately

ISLAMABAD: The Finance Ministry has opposed provision of free electricity to employees, officers, dignitaries and institutions, urging the Power Division to disconnect this facility immediately, well-informed sources told Business Recorder.

The Finance Ministry has communicated these comments on a summary of the Power Division, in which the latter proposed to monetize free electricity to officers of power sector with immediate effect whereas this facility to employees will be withdrawn in the second phase to avoid unrest.

The Power Division, in its draft summary, noted that there are ten power Distribution Companies (Discos), Iesco, Fesco, Mepco, Gepco, Lesco, and Sepco. Hesco, Tesco, Pesco and Qesco, Generation Companies (Gencos), National Transmission and Despatch Company (NTDC) and Power Information Technology Company (PITC) under the administrative control of the Power Division. The Water and Power Development Authority (Wapda) is now under the administrative control of the Ministry of Water Resources.

As per the policy in vogue, the facility of free electricity is allowed to the employees of Discos/Gencos/NTDC/PITC/Wapda in accordance with the following permissible limits: for staff in grade 1-4, non-generation free supply concession (units) is 100 per month and generation free supply concession is 300 units per month;(ii) grade 5-10, 150 units and 600 units; (iii) grade 5-10, 200 units and 600 units; (iv) officers in grade 16, 300 and 600 per month; (v) officers in grade 17, 450 and 650 units per month; (vi) officers in grade 18, 600 and 700 units; (vii) officers in grade 19, 880 and 1000 monthly; (viii) officers in grade 20, 1100 and 1100 units monthly; and (ix) officers in grade 21, 1,300 units monthly.

PD to ‘monetize’ supply of free electricity to officers

The Senate Standing Committee on Power and the Public Accounts Committee (PAC) had directed that the facility of free electricity provided to the employees of the power sector may be monetized instead of providing this facility through billing and may be paid from the monthly salary to employees.

Details of annual monetization expenditure with respect to BPS 17 and above (number of officers based on June 2002 is 7,645 of which number of officers of Gencos was 1,036, Discos 4,615, NTDC 1937 and PITC 57) gives then a total entitlement of 4,327,260 units per month, the price of which is Rs 91,898,021. The cost of electricity of 51,927,120 being provided to them is Rs 1,102,776,247 per year.

The Power Division, in its summary, recommended that employees falling in BS-1-16 may not be included in the scheme of monetization in the first phase to avoid unrest and also in order to implement the scheme in a phased manner.

Approximate expenditure in respect of employees in BS 1-16 is as follows: Gencos 7,360, Discos 79,024, NTDC, 18,305 and PITC 60. The total expenditure on their entitlement is Rs 5,310,362,819.

The Power Division has also recommended that the officers of Discos/Gencos/NTDC/ PITC/Wapda in BS 17 and above may have their units monetized at the electricity rate of the said category. This way the amount of the bill shall be paid by the employees instead of their respective companies.

The Power Division maintains that the same policy for the staff of the same companies/organizations in BS -1 to 16 may be implemented in the second phase (a separate summary in this regard will be submitted by the Ministry of Energy Power Division).

The Finance Ministry, in its comments, has stated that Finance Division is of the view that the provision of free electricity to either employees of DISCOs/GENCOs, NTDC/PITC/Wapda or any other federal/provincial government employees and any other high dignities institutions/organizations may not be granted with the reason that this arrangement has financial impacts and its cost included in the electricity tariff. Resultantly, the other consumers of all categories are paying the cost of free electricity which ultimately is taken up by GoP as a subsidy.

The Finance Ministry has made it clear that it does not support the proposal with a view that provision of free electricity in these organizations/entities employees’ in BS-1 to BS-22 or any other federal/provincial government employees and any other high dignitaries/institutions/or-ganizations may immediately be discontinued. And no such allowance in lieu of free electricity be granted to anyone.

Copyright Business Recorder, 2022