Money Matters

Autonomous decisions

By Ihtasham Ul Haque
Mon, 12, 16


The belligerent Pakistan Muslig League-Nawaz (PML-N) government is once again confronting an embarrassing situation for unilaterally restricting the role of five major regulatory bodies.

Since most of the political parties particularly the Pakistan Peoples Party (PPP) and the Pakistan Tehreek-e-Insaf (PTI) are putting up fierce opposition, the government may not have an easy sailing in the coming days and weeks both in and outside the parliament.

Nevertheless it remains a fact that a unilateral decision has been taken by the federal government to transfer the administrative control of the five regulatory authorities to their respective ministries.

The issue has attracted public criticism but the government does not seem to be in a mood to withdraw the notification issued last week placing these five regulatory authorities to their respective ministries and divisions by removing them from the cabinet division.

Senate of Pakistan rejected the government’s decision last week saying that Council of Common Interests (CCI) has been bypassed. Chairman Raza Rabbani allowed the senators to discuss the issue which according to them is repugnant to the Constitution. The move is being seen as a helping hand for the ministries’ to have leverage over the regulators.

It is generally said that a few years ago, the Competition Commission of Pakistan (CCP) was rendered toothless, and now it was  the turn of  these statutory bodies to stop being transparent to make autonomous decisions without safeguarding the interests of the consumers.   

These bodies – National Electric Power Regulatory Authority (Nepra), Oil and Gas Regulatory Authority (OGRA), Pakistan Telecommunication Authority (PTA), Frequency Allocation Board (FAB) and Public Procurement Regulatory Authority (PPRA) - have now been given under the water and power division, petroleum and natural resources division, information technology division, telecom division and the finance division respectively.

This entire exercise is said to have been done to primarily undermine the authority of Nepra, a strong regulator, to benefit the Chinese investors who are insisting to have an increased electricity tariff for upcoming power plants at the cost of the consumers.

The Council of Common Interest which met on December 16 had reportedly refused to accord permission to change the status of the regulatory authorities that led to the unilateral decision of the federal government to place them in their respective divisions. The prime minister is believed to be supportive of the decision to help increase foreign investment, especially from the Chinese, whose companies are demanding new power tariff outside the preview of Nepra.   “This is against the regulatory body act of 1997 and the spirit of the 18th constitutional amendment,” said renowned economist and former minister for finance Dr Hafeez Pasha.

He said that Nepra was doing an outstanding job of protecting the interests of the consumers and thus stopping the monopoly. “The balance created by establishing Nepra has now been turned into an imbalance,” he said, and added that undermining the role of autonomous Nepra and other regulators would have devastating effects on consumers.

Among the five regulators, the role of the OGRA and Nepra remained very important over the years in terms of protecting the rights and interests of the consumers. They had been showing a lot of resistance against the orders and wishes of their respective divisions, whose bosses are believed to have told the prime minister that these bodies have overgrown and often refuse to oblige the senior government authorities.

Despite pressures, OGRA passed on the benefits of the falling international oil prices to the people in the past and if it had not been a vibrant regulator, the government would not have conceded any relief in this behalf.   

In recent months, Nepra, however, has assumed more importance, particularly when it started pointing out losses of various power plants including that of Nandipur and Sahiwal coal-fired project that did not go well with the officials of ministry of water and power.

The CCI meeting proved difficult for the federal government, as Sindh and Khyber Pakhutunkhwa kept opposing, even in the next meeting, the placement of regulatory bodies under their respective ministries and divisions.

Now that the government has issued a notification for withdrawing the administrative control of all the five regulating agencies from the cabinet divisions and putting them in their parent division, the issue has to be eventually decided by amending the rules and business in the 1973 constitutions.

Reports emanating from Khyber Pakhutunkhwa and Sindh suggest that it would not be easy for the government to get the related clauses amended as the opposition parties have already rejected the decision and plan to give a tough time to the government. 

The writer is a senior journalist based in Islamabad