Crackdown against electricity theft to be launched: ECC

Web Desk
September 03, 2018

ISLAMABAD: A major crackdown against electricity theft was announced on Monday by the Economic Coordination Committee (ECC).

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The Economic Coordination Committee of the Cabinet (ECC) on Monday directed the Power Division to take strict legal action against those officials and individuals, who were involved in power theft without any leniency.

Federal Minister for Finance, Revenue and Economic Affairs Asad Umar chaired the ECC meeting here at the Cabinet Division.

Discussing the issue of power sector recoveries, the committee decided that meters of those persons, departments and ministries or any private entity would be disconnected if they failed to pay their bills for consecutive three months.

On the payment of their bills they would be provided prepaid meters, the ECC decided. The committee was given presentation on the issue of circular debt that had accumulated over the years to a hefty sum of Rs1,188 billion.

On the presentation of the Special Audit Report on payment of circular debt of Rs 480 billion by the Department of Auditor General of Pakistan, the ECC directed to hold an Operational and Financial Audit of distribution companies (Discos).

It was decided that the Auditor General of Pakistan would complete the audit of four highest loss making Discos in a month and that of the entire sector in two months after the approval from Cabinet.

The committee was briefed on the impact of Industrial Support Package, Azad Jammu Kashmir subsidized units, Balochistan agricultural tubewells, FATA receivables, and the impact of existing time lag on tariff determination mechanism of NEPRA.

The ECC observed that the PML-N government had taken the decision to discontinue the provision of subsidized power supply to the AJK in budget 2018 and also to discontinue the industrial support package.

The committee decided to bring the facts to the attention of the Federal Cabinet.

The ECC also decided that to cope up with the issue of urea fertilizer shortage in the country, three urea manufacturing plants that were presently in-operational would be supplied RLNG for a period of four months starting from September with 50% cost of RLNG being picked up by the government and the balance 50% by the respective manufacturing units.

These plants would utilize their full potential and the decision to import fertilizer would be taken after taking into account their production capacity.

The ECC directed the Ministry of Industries and Production to workout figures/data about actual production and consumption of the urea during 2017-18 and the estimates for 2018-19, in consultation with the Ministry of National Food Security & Research and submit a report thereof to the ECC in its next meeting.

In case of any shortfall in consumption of urea, the reasons may also be identified in the report, The ministry was directed to facilitate the operationalization of three closed fertilizer plants i.e.

Fatimafert, Agritech and Pakarab (in case of the latter only to the extent of urea production amounting to 8000 tons per month) on 100% RLNG for urea production for four months (September - December 2018), The ministry was asked to work out total subsidy impact on running of all three plants i.e.

Fatimafert, Agritech and Pakarab on 100% RLNG with 50% of subsidy being borne by the Government while remaining 50% being picked up by the respective fertilizer plants.

It was also directed to work out the windfall gains reaped by the fertilizer industry, in light of the netVariable Contribution Magins, as a result of charging higher rates as well as exports during 2017-18 and 2018-19. The windfall gains may be adjusted against the subsidy outstanding in favour of fertilizer industry, under the fertilizer subsidy schemes which were in vogue during the preceding three financial years.

The ECC also considered the update on the issue of sale of K-Electric and issued directions to thedepartments concerned to formulate their recommendations for CCOP.

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