ECC okays Rs30.2bn for Voluntary Separation Scheme for 11,350 USC employees

ISLAMABAD: The Shehbaz Sharif-led government on Thursday approved Rs30.216 billion for the Voluntary Separation Scheme (VSS) for almost 11,350 employees of the defunct Utility Stores Corporation (USC) of Pakistan.

The USC has been closed down, but a certain number of employees will be retained in order to dispose of its properties and assets in a smooth manner.

The Ministry of Finance high-ups during the Economic Coordination Committee (ECC) of the Cabinet raised the issue of the exact timeframe for selling of properties so that revenues could also be generated after clearing liabilities through Technical Supplementary Grants (TSG).

The ECC was informed in a presentation that there are 5,250 regular employees, 3,300 contractual employees, and 2,800 daily wage workers employed by the USC.

The ECC has approved Rs13.225 billion for severance of regular employees, Rs5.751 billion for terminal dues and compensation for widows, Rs2.192-6.337 billion as a one-time payment for contractual and daily wage staff (to be finalised after negotiations with the CBA) and Rs1.467 billion for pending salaries of April, and for salaries of July-August 2025, along with operational expenses. The sources said that around 800 employees will be retained in the USC until the disposal of properties and other assets of the defunct corporation.

The ECC, chaired by Federal Minister for Finance and Revenue Muhammad Aurangzeb, approved a technical supplementary grant of Rs30.216 billion to ensure the smooth closure of USC.

The decision represents a major step in responsibly addressing the longstanding financial burden of the USC on the national exchequer, while also safeguarding the interests of employees affected by the closure. By approving severance, compensation and payment of outstanding dues, the government is ensuring that workers receive their entitlements, thereby cushioning the social and economic impact of USC’s winding up.

The ECC also decided that the Ministry of Industries & Production would further rationalise the financial requirements for the closure of USC. It was further decided that the USC assets, including properties, would be disposed of within the current financial year so that the costs of closure are partially met through sale proceeds. The cabinet body also underlined the importance of carrying out the closure in an orderly and transparent manner, including the disposal of USC properties to partially meet liabilities. The approved financial package underscores the government’s commitment to protecting employees’ welfare while ensuring fiscal discipline in the winding down of USC’s operations.