Ministry of Industries and Production (MoI&P) on Thursday held Chief Executive Officer (CEO), Pakistan Steel Mills (PSM), Major-General Zaheer Ahmed Khan (retired) responsible for suspension of gas supply which led to closure of the plant.
This was revealed by the both the Minister for Industries and Production, Ghulam Murtaza Khan Jatoi and Secretary Industries, Arif Azim at a meeting of Senate Standing Committee on Industries and Production which was attended by Senator Hadayat Ullah, Senator Mian Ateeq Shaikh(MQM), Senator Taj Haider (PPP) and Chaudhary Tanvir Khan(PML-N). Eight Senators did not attend the meeting.
Both the Minister and Secretary who looked visibly annoyed at the PSM management informed the committee that five to six months back it was decided at an inter-ministerial meeting that PSM will pay current gas bills to SSGC which will restore gas supply to the plant. CEO PSM had agreed to implement the decision but later on backed out. Wasif Mehmood, Principal Executive Officer (PEO) PSM (Production Directorate) and Acting PEO Captain Shamsi Hasan (retired) (Technical Services Directorate) did not speak a single word in defence of the CEO.
The committee was informed that the Ministry has put up a summary for revival of PSM prior to privatisation for approval of Prime Minister Nawaz Sharif. Senate Standing Committee on November 25, 2015 had recommended that in order to avoid multiplication of loss the federal government should grant bailout package of Rs 8.52 billion immediately to meet the requirements up to June 30, 2016. Besides, a bailout package of Rs 0.2billion will be required for repair of important equipment/ machinery for sustainable production.
Secretary Industries informed the committee that the Economic Co-ordination Committee (ECC) of the Cabinet approved payment of October-November 2015 salaries to the PSM employees. However, when the issue of payment of provident fund and gratuity to the retired employees came under discussion, MoI&P stated that the matter has been taken up with Finance Ministry which stated that it has no provision in the budget to entertain gratuity for PSM employees. Moreover, Finance Division had not been consulted at the time of withdrawal of the gratuity amount by PSM. The top representatives of PSM failed to satisfy the committee.
Senator Taj Haider who is using his energies to convince Sindh government to purchase PSM, revealed that PSM employees stood with PIA employees in protest in Karachi. Minister for Industries and Production argued that it was decided in the Senate Standing Committee a few months ago that PSM will apportion 10 to 20 per cent out of sale of Rs 9 billion inventory but the management did not implement the decision.
Secretary Industries backed the Minister, saying that PSM management sold an inventory of Rs 3.3 billion but did not pay gratuity and provident fund to the retired employees as per the decision. However, PSM's official from Finance sector challenged the arguments of Minister and Secretary, saying that there was no such decision. Minister rejected this claim and argued that the decision may not have been mentioned in the minutes but the issue was discussed and a decision was taken.
Secretary Industries informed the committee that both the Ministry of Industries and Production and Privatisation Commission (PC) have serious reservations on the way Rs 3.3 billion were spent by the PSM management. Wasif Mehmood, PEO, clarified that the PSM had paid bills including gas bill. Secretary Industries replied that PSM has paid only Rs 7 million for gas bill and a few million on water and other charges.
Senator Taj Haider while siding with PSM management stated that gas supply was suspended when the plant achieved 65 per cent CAPU. Minister MoIP who looked irritated at 65 per cent CAPU claim, said that the average capacity utilisation of PSM was 40 per cent. PSM achieved 65 per cent only for one day. He further stated that the mills cannot earn profit without achieving 77 per cent CAPU which requires a huge investment.
He said, Privatisation Commission has offered Steel Mills to Sindh government after the latter expressed an interest. Senator Taj Haider said that PC has not provided documents to the provincial government. However, when Secretary Industries challenged Senator Taj Haider by saying that PC has provided complete documents including due diligence, Taj Hader said a committee comprising Murad Ali Shah, Finance Minister Sindh and Senator Salim Mandviwala is reviewing the documents. He further disclosed that provincial government is also looking for a technical partner to run the mills.
Minister Industries and Production, Ghulam Murtaza Khan Jatoi, took the mike and stated that federal government is also looking for a technical partner with 26 percent shares, raising the question when both governments are looking for technical partners then why Sindh government is opposing federal government's endeavour.
Senator Taj Haider said the federal government basically wants to sell PSM land which is the property of Sindh. "We are submitting a petition with the SHC for PSM land and so let the court decide," he continued. However, Secretary Industries who has served Sindh as Member Revenue Board challenged the viewpoint of Senator Taj Haider, saying that he has gone through the entire documentation of PSM but did not find a single paper which backs the stance of Senator Taj Haider. He said that the federal government purchased the land from Sindh and requested Senator Taj Haider to share any document which stipulates that the land belongs to Sindh.
During a discussion on illegal construction and encroachment in Gulshan-e- Hadeed, the committee snubbed the PSM officials especially Mr Shamsi for not sending the case to NAB or FIA. Both the Ministers and Secretary smiled sarcastically at the weak arguments of PSM officials. The committee directed PSM officials to bring details of illegal construction and encroachment so that case may be referred to NAB or FIA whichever is the appropriate forum.
When Chaudhry Tanvir Khan enquired from PSM officials about the action has been taken against those PSM officials who allowed illegal construction, Shamsi replied that they have retired. The committee took serious note of his comment. The committee also warned Shamsi that action will also be recommended against him for not expediting the case.
The committee discussed financial vows of Pakistan Machine Tool Factory. Ministry of Industries and Production revealed that a letter has been sent to Secretary PC for a bailout package of Rs 3 billion to clear outstanding dues of various institutions, three months' salary and clearance of provident fund and gratuity to retirees.
Secretary Industries informed the committee that PMTF has received orders of more than a billion rupees and is also hoping for another order of Rs 700 million. Senator Taj Haider said conflict in the Middle East will further fuel and Pakistan will get more orders.