Legislation related to privatisation of loss-making SOEs: Minister says govt will need support of Parliament

ISLAMABAD: Finance Minister Muhammad Aurangzeb has said that the loss-making state-owned enterprises (SOEs) are causing one trillion rupees of “drag” to the exchequer, and the federal government would require the support of the parliament for legislation related to the privatisation of the said SOEs.

“The loss-making SOEs— they contribute 1 trillion rupees of drag to the exchequer— we can use these 1 trillion rupees in many other areas for which we will need the help of you all,” he told the Senate in the house meeting on Tuesday.

The government would bring legislation related to the privatisation for which parliament’s help is required, he added, in response to a related question posed by Zarqa Suharwardy Taimur from Pakistan Tehreek-e-Insaf (PTI) in the Senate question hour.

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To another question by Anusha Rahman of Pakistan Muslim League-Nawaz (PML-N), the minister said, the Cabinet Committee on SOEs, not the Finance Ministry, is dealing with determining which SOEs are strategic, essential or to be privatised.

“Regarding strategic and essential SOEs, we will go with the governance enacted under the SOEs Act— which means that majority of the governance in those boards is going to the private sector. The political appointees and the government nominees are going to be in minority.” He said the Cabinet Committee on SOEs will decide on the fate of Trade Development Authority of Pakistan (TDAP).

To another question, the finance minister said, the pension of retired government employees is a “ticking bomb,” and, to deal with it, he said, legislation has to be brought.

“This is not a small matter, the issue of pension is under discussion not for years but decades—at least we have to stop the bleeding if we have to move forward—we have started from this year that all the government employees have to carry on with this,” he said.

Aurangzeb said the Federal Board of Revenue (FBR) issued tax refunds of Rs52 billion this July 1, on the start of this fiscal year. As of now, sales tax refunds of Rs152 billion have been issued, he added. “We believe that the liquidity of the exporters should not be affected.”

In June 2020, he said, the debt to GDP (Gross Domestic Product) ratio was 77 percent compared to 67 percent this year. In fiscal year 2021, increase in debt percentage was 30 percent, which is down to 15 percent now, he said.

The finance minister appreciated the contributions of economists Qaiser Bengali and Ishrat Hussain for preparing a roadmap related to rightsizing in the government departments.

According to Aurangzeb, the rightsizing panel that he heads is currently working on rightsizing in six ministries. He denied that downsizing of the government employees falling in grades 1 to 16 only was under consideration.

Commerce Minister Jam Kamal said the federal government is working to announce the Trade Policy 2025, to be presented to the standing committees of the parliament soon.

He told the house that textiles and apparel exports slightly increased by 0.93 percent in FY 2023-24, as compared to previous fiscal year.

Pakistan Peoples Party (PPP) Parliamentary Leader in Senate Sherry Rehman expressed concern over reportedly proposed changes in Indus River System Authority (IRSA) Act 1992. Speaking on a calling attention notice that she moved along with other PPP senators, Rehman said, the proposed changes in IRSA Act 1992 would affect agriculture production in Sindh.

Poonjo Bheel, one of the joint movers of the calling attention notice, said, the status of Water Resources Ministry is illegal after the passage of the 18th constitutional amendment.

Water Resources Minister Musadik Malik responded that no law that was deemed unsuitable for any province would be enacted. “Why is there concern about a law that has not arrived in the first place,” he said, adding that the government wanted legislation on key issues of all the parliamentary stakeholders including the opposition. The house was adjourned till Thursday.

Copyright Business Recorder, 2024