Essential food items and consumer products: ECC for maintaining gap between wholesale, retail prices

ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has approved Pakistan Steel Mills (PSM) employees’ net salary for first six months of 2023-24 fiscal year and directed the Planning Ministry to ensure control of undue profiteering and to maintain the gap between wholesale and retail prices of essential food items through chief secretaries.

The meeting of the ECC presided over by the caretaker Finance Minister, Dr Shamshad Akhtar, was informed by the Ministry of Industries and Production that the PSM started incurring losses from the year 2008-09, which accumulated to Rs206.068 billion till 30-06-2022 and owing to persistent losses, the government of Pakistan has been providing funds for the net salaries of PSM’s employees since 2013.

The production operations of PSM have been suspended since June 2015. Therefore, the entity does not have adequate financial resources to pay for the salaries of its employees.

PSM employees: ECC may approve Rs1.244bn for payment of salaries

In the wake of the privatisation process of the PSM, the federal government decided to retrench the PSM’s employees. So far, 5,679 employees have been retrenched and approximately, 3,100 employees are working. Due to retrenchment of the employees, the salaries of the employees have been reduced from Rs360 million per month in 2020-21 to around Rs104 million per month at present.

The ministry requested the ECC to authorise the Finance Division to approve the payment of projected net salary of Rs1,244 million for the financial year 2023-24 to be disbursed according to the salary demand of the PSM for every month from the already approved budgetary allocation of Rs10 billion.

The ECC meeting, after deliberation, authorised Finance Division to approve the payment of projected net salary for first six months of the fiscal year 2023-24 to be disbursed according to the salary demand of PSM for every month from already approved budgetary allocation of Rs10 billion.

The ECC was briefed by the Ministry of Planning, Development, and Special Initiatives about the trends of major economic indicators and trends in the prices of essential food items.

The ECC directed the Ministry of National Food Security and Research to prepare and submit regular reports on availability of stocks, consumption, and pricing of all staple items, especially wheat and sugar, to the ECC in order to enable it to monitor the availability and pricing of these important commodities.

The ECC also directed the Ministry of Planning, Development and Special Initiatives to ensure control on undue profiteering and to maintain the gap between wholesale and retail prices of the essential food items and consumer products through respective chief secretaries.

On a summary moved by the Ministry of Energy regarding “Transition of London Inter-Bank Offer Rate (LIBOR) to Secured over Night Financing Rate (SOFR)”, the ECC, after discussion, directed the Ministry of Energy to prepare a detailed analysis of the financial implications of this decision and bring it in the next ECC meeting for discussion and approval.

The meeting of the ECC was attended by Sami Saeed, Minister for Planning, Development and Special Initiatives, Gohar Ijaz, Minister for Commerce, Industries, and Production, Shahid Ashraf Tarar, Minister for Communication, Maritime, and Railways, Muhammad Ali, Minister for Power and Petroleum, Umar Saif, Minister of IT and Telecommunication, Advisor to PM on Finance Dr Waqar Masood, governor SBP, chairman SECP, federal secretaries, and other senior officers.

Copyright Business Recorder, 2023