Associated Press of Pakistan
September 24, 2013

Federal Minister for Planning and Development,Professor Ahsan Iqbal said on Tuesday that the government was committed to bring reforms in every public sector enterprise in the country. Addressing a joint conference on “Corporate Governance in Public sector Enterprises” here, Ahsan Iqbal said that within few years,the government will turn the country into the fastest growing state in Asia. The conference was organized by ACCA Pakistan in collaboration with Center for International Private Enterprise (CIPE). The Minister said that the public sector enterprises today is acting as the biggest hemorrhage as the country is loosing Rs.500 billion annually due to mismanagement and corruption in these organizations. [EXPAND Read more]

“Our dilemma is that we have run our organizations very callously and thousands of unnecessary staff has been inducted in these organizations which is a criminal activity”, the minister added.

He said the government will have to take unpopular decision in order to set the public sector enterprises on the right path.

Later talking to media,Professor Ahsan Iqbal said that Prime Minister Youth Package would help reducing unemployment in the country.

“The unemployment in the country has increased alarmingly and the government can not give employment to everybody, therefore the government has decided to facilitate educated youth by giving them loans for small business and providing training for development of skills”, the minster remarked.

Earlier during the penal discussion, Abdullah Yusuf,Chairman PICG said that the government should privatize the state owned entities as it is not the business of the government to be in the business.

He said when he was secretary Privatization during 1990s, WAPDA,PIA, steel mill,all banks and petroleum companies including PSO, all were on the list of privatization but due to lack of consistency and change of government this could not happen.

Dr.Khaqan Najeeb,Director General in Ministry of Finance on the other hand said that privatization was not a solution to the ongoing crisis.

He said that bringing reforms in the state owned entities can turn these deficient organization into profitable entities.

He cited the example of Karachi Electric Supply Company which could not turn into a better organization after privatization.

Moin M Fuda, Country Director CIPE said on the occasion that the country is loosing Rs.800,000 per minute due to loss in the public sector enterprises and two third of this loss occur in three major companies including PIA, WAPDA and Railways.

He said the weak performance of large public sector enterprises in key Pakistani industries is a drag on both finances and growth and has deteriorated the country’s fiscal balances.

“In the last five years,the federal government has borrowed Rs.2.7 trillion from International Monetary Fund (IMF), while spending Rs. 2.3 trillion to finance the losses of PSEs through equity injections, subsidies, grants,loans and loan guarantees”, he added.

He further said that the recently approved rules for public sector enterprises corporate governance stipulate that these companies’ boards appoint professional managers as CEOs,thus reducing government interference in their operations and allowing the public sector enterprises to take the steps needed to cut losses and increase earnings. [/EXPAND]