Latest news with #State-OwnedEnterprises(GovernanceandOperations)Act
Business Recorder
4 days ago
- Business
- Business Recorder
Mujahid Pervez Chattha made Gepco chairman
ISLAMABAD: The Power Division has appointed former chief executive officer (CEO), Lahore Electric Supply Company (Lesco) Mujahid Pervez Chattha as Chairman/ Independent Director of the Board of Gujranwala Electric Power Company (Gepco). According to the notification, his appointment as chairman has been made consequent upon approval of the Federal Cabinet, and in terms of provisions of State-Owned Enterprises (Governance and Operations) Act, 2023 and State Owned Enterprises (Ownership and Management) Policy, 2023. According to sources, the prime minister had approved the name of Commodore Muhammad Siddiq (retired) who was already an Independent Director as Chairman Gujranwala Electric Power Company. However, the Cabinet Committee on State Owned Enterprises (CCoSOEs) rejected the name of Siddiq as chairman. The Chairman/Independent Director of GEPCO Board namely Imran Zaffar had resigned from the Board therefore, chairman of the board/ independent director was required to be nominated. Copyright Business Recorder, 2025
Business Recorder
18-05-2025
- Business
- Business Recorder
ECC grills PD: Discos' T&D losses total Rs143bn till March
ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has grilled Power Division for its failure to control Transmission & Distribution (T&D) losses in the power Distribution Companies (Discos) as cumulative losses till March 2025 stood at Rs 143 billion which are above monthly assumptions, well-informed sources told Business Recorder. The Finance Division is also considering deducting federal and provincial governments' outstanding electricity dues at source before June 30, 2025. At a recent meeting of the ECC, the Power Division briefed the forum that 11 DISCOs operate under the administrative control of the Power Division and are governed by the provisions of the State-Owned Enterprises (Governance and Operations) Act, 2023 and State-Owned Enterprises (Operations and Management) Policy, 2023. The matters of Board of Directors were also governed under the Act and Policy. T&D losses amassed: Nepra to sue Discos for Rs276bn circular debt The Board of Directors of Faisalabad Electric Supply Company (FESCO), Islamabad Electric Supply Company (IESCO), Lahore Electric Supply Company (LESCO), Multan Electric Power Company (MEPCO) and Hazara Electric Supply Company (HAZECO) were constituted on July 24, 2024. Moreover, the Board of Directors of Gujranwala Electric Power Company (GEPCO), Peshawar Electric Supply Company (PESCO), Quetta Electric Supply Company (QESCO), and Tribal Areas Electric Supply Company (TESCO) were constituted on August 21,2024. The summary for reconstitution of HESCO and SEPCO Boards with appropriate representation of independent and ex-officio directors as per relevant provisions of State-Owned Enterprises (Governance and Operations) Act, 2023 and State-Owned Enterprises (Operations and Management) Policy, 2023 were submitted to Prime Minister's Office on August 23, 2024 and September 09, 2024, respectively. In compliance with the directive issued in the ECC meeting held on November 4, 2024, following were the status update regarding the governance of DISCOS: (i) the Boards of Directors (BoDs) for all DISCOs have been reconstituted, except for SEPCO and HESCO, where the process is in the finalization stage. The reconstituted Boards are structured to ensure enhanced corporate governance, strategic oversight, and operational efficiency; and (ii) the PPMC has implemented a monthly performance monitoring mechanism for all DISCOs, evaluating key operational, commercial, and financial parameters. This monitoring framework ensures that each DISCO is accountable for its performance and adheres to the sector's strategic goals. In line with the National Electricity Policy, strategic roadmaps have been formulated and signed in February 2025 by the respective chairpersons of the BoDs and CEOs of all DISCOs. These roadmaps outline T&D/Aggregate Technical and Commercial (AT&C) loss reduction, bill collection, theft prevention, load-shedding management, consumer services, safety compliance, Supervisory Control and Data Acquisition (SCADA) implementation, Geographic Information System (GIS) mapping, Enterprise Resource Planning (ERP) system automation, computerized energy audits up to the distribution transformer level, and the execution of Service Level Agreement (SLA) & Operation and Maintenance (O&M) frameworks. The Power Division further briefed the forum that to accomplish these objectives, a structured action matrix had been developed by DISCOS, covering key initiatives such as feeder rehabilitation, distribution transformer addition/augmentation, grid station expansion, capacitor installation, HT and LT line addition, transmission line upgrades, Aerial Bundled (ABC) cable deployment, and Advanced Metering Infrastructure (AMI) meter installation. In light of directive/decision issued in ECC meeting held on November 4, 2024, the status regarding the governance of all DISCOs whose Boards had been reconstituted with a view to improving the governance of DISCOs was submitted in form of summary to ECC under rule 18(1) read with 23(4) of Rules of Business, 1973. During the ensuing discussion, the forum was conveyed that the Boards of all DISCOs, except HESCO and SEPCO, had been re-constituted, further informing that with the oversight of Boards, the entities had shown improvement. The forum was also conveyed that the PPMC, being technical arm of the Division, is regularly monitoring the performance of the distribution companies. It was also noted that the targets assigned to the Power Division regarding reduction in T&D losses have not been met. It was noted with concern that the losses of LESCO had increased, instead, over the year and the forum stressed upon the need for adopting a robust plan to arrest this trend. The forum was informed that the interventions are being made to improve the operations of entity to reduce the losses. The forum was informed with reference to QESCO that 70% of the losses are due to agriculture tube wells, and that their solarisation would improve the situation. The Power Division also apprised the forum about the Government Department's dues of DISCOs to be paid by the Federal and Provincial Government Departments, and sought intervention of the Finance Division for their early clearance. The forum was informed that the mechanism is in place for at source deduction of the amount, once the liability/amount is reconciled between the Distribution Company and the provincial government. After detailed discussion, the ECC directed the Power Division to share the reconciled figures of the outstanding electricity dues, to be paid by the Federal and provincial government entities, with the Finance Division for their early settlement clearance. Copyright Business Recorder, 2025
Express Tribune
01-03-2025
- Business
- Express Tribune
Govt orders SOEs to disclose assets
Listen to article The government has instructed the management and boards of all state-owned enterprises (SOEs) to disclose their assets and beneficially owned investments after discovering weak financial transparency and a lack of accountability within these entities. The instructions were issued after the Central Monitoring Unit — a special cell set up to monitor financial progress and ensure accountability in the public sector — found serious lapses on the part of boards and management. An overwhelming majority of management and board directors were not disclosing their assets, violating an Act of Parliament. Sources said there was hardly any government organisation whose boards and management disclosed their assets and beneficially owned investments. The Ministry of Finance has issued fresh instructions to the boards and management through their respective line ministries. "As part of ongoing efforts to enhance governance and transparency within SOEs, it is imperative that all SOEs under the administrative control of respective line ministries comply with the provisions of the State-Owned Enterprises (Governance and Operations) Act, 2023," stated an office memorandum issued by the finance ministry. The memorandum, sent to all SOE boards, mandates compliance with Section 30(1) of the State-Owned Enterprises (Governance and Operations) Act, 2023, which requires the annual disclosure of assets and beneficially held investments and properties. These instructions come alongside a proposal to amend the Civil Servants Act to require public disclosure of assets by members of the 12 occupational groups. However, due to the limited scope of the Civil Servants Act, only about 25,000 individuals would be affected. The state of affairs in some public sector companies remains concerning, as federal ministers and contractual employees continue to sit on the boards of these companies in violation of the SOEs Act. A contractual employee of the finance ministry is also on the board of the Privatisation Commission, while a federal minister remains a member of Pak-Arab Refinery Limited (PARCO). While the finance ministry has directed all SOE boards to implement Section 30(1) of the Act, it has yet to enforce this requirement on some of its own employees. The law states, "The directors and senior management officers of a state-owned enterprise shall annually submit their assets and beneficially held investments and properties to the Board, and any changes thereon shall be reported to the Board within two weeks of such change, subject to such reasonable restrictions on making this information public as may be imposed by the Board in its conflict management policy." The memorandum further highlights that the State-Owned Enterprises (Ownership and Management) Policy, 2023 reinforces principles of financial transparency and accountability. It mandates SOEs to establish governance mechanisms in alignment with the Act to ensure compliance with disclosure and reporting requirements. The ministry has instructed all boards and management to provide updates on the law and policy's implementation status. The International Monetary Fund (IMF) has already urged Pakistan to implement a risk-based verification of disclosed civil servant assets, impose penalties, and investigate officers whose assets exceed their declared sources of income. During one of its meetings, the global lender discussed referring cases of bureaucrats with mismatched assets and income sources to the National Accountability Bureau. The board of Pakistan Revenue Automation Limited (PRAL) — a key player in the government's Rs3.7 billion plan to modernise the tax machinery's IT arm — has also started operations without first disclosing potential conflicts of interest or developing a code of conduct, a legal requirement. The non-disclosure of conflicts of interest violates the State-Owned Enterprises Act and the SOE policy — two legal frameworks developed with international financial institutions' assistance to improve governance in state-run entities. The board has been holding meetings without ensuring that newly appointed members have no direct or indirect conflicts of interest while making key policy decisions. The CMU's Corporate Governance report noted that despite their critical importance, SOEs in the oil and gas sector face governance challenges, including delayed financial reporting, inefficient governance practices, and weak risk management systems. These issues erode public trust and hinder the sector's ability to contribute effectively to national energy security, as per the report. Transitioning to a merit-based appointment system is crucial to improving decision-making and reducing inefficiencies, the CMU recommended. Similarly, the CMU reported that SOEs in the power sector face severe governance challenges, including operational inefficiencies, financial losses, weak financial management, and underperforming boards of directors. These issues have contributed to persistent circular debt, unreliable energy supply, and limited progress in achieving sustainable energy goals. Boards of DISCOs such as LESCO, HESCO, TESCO, and GEPCO have frequently been criticised for including members with limited expertise in energy management. A merit-based and skill-focused approach to board composition is necessary to strengthen their performance, the report recommended. These findings are based on the situation as of June 2024. Regarding Development Financial Institutions (DFIs), the CMU report stated that board appointments should be based on professional expertise and experience rather than political affiliations. Contrary to this advice, the finance ministry is currently filling four vacant positions on DFI boards in violation of policies and the law. A contractual employee or bureaucrat cannot serve as an independent director on a board. The Central Monitoring Unit also noted that Pakistan International Airlines has frequently been subject to political appointments and decisions that have affected its operational efficiency and profitability. Ensuring independent board appointments based on merit and expertise — rather than political considerations — is crucial to improving governance, it added.
