Pakistan Postal Service deficit crosses Rs10b mark

ISLAMABAD: The Public Accounts Committee (PAC) was informed on Tuesday that the Pakistan Postal Service (PPS) started facing deficit in 2011-12 and it doubled during the tenure of the current government. The committee met here with Syed Khursheed Shah in the chair. The Pakistan Postal Service officials briefed the committee on the department’s financial position. The officials of Pakistan Postal Service suggested an increase in the price of postal stamp from Rs8 to Rs40 to reduce deficit. The committee was told that it was being considered that the department should be run through the public-private partnership rather than privatising it. It was told that work was in progress for over two years to run the department on a new business model. The committee was told that the department earned over Rs400 million profit in 2009 but later it faced over Rs1.89 billion deficit which continued to increase. The department’s expenditure increased to Rs20.5 billion in financial year 2016-17. The department earned Rs10.5 billion, while the deficit cross over Rs10 billion.

The committee was told that 75 percent budget of Pakistan Postal Service went towards payment of salaries and pension.

The committee was further told that transaction through schemes like Easypaisa had crossed $6 billion.

The department is planning to create an Easypaisa scheme and in this regard an agreement for a joint venture with Korea EXIM Bank will be signed, the committee was told.

The committee was further told that it will be a government to government agreement under which the bank will provide Rs2.5 billion at interest rate of less than 5 percent.

Khursheed observed that the PTCL case was before the committee, as they owed Pakistan $800 million but ‘we are not able to get it from them, while the Pakistan Postal Service has property assets of Rs40 billion to Rs50 billion’.

The committee was told that the PPS was not selling its property.

The Pakistan Postal Service officials told the committee that a postal stamp was still sold for Rs8 while its production cost was Rs17.

It was suggested that if the postal stamp was fixed at Rs40 then it will contribute towards reducing the deficit by a half.

The committee was told that the postal stamp price was increased last time in 2009.

The committee was told that the burden of salaries and pensions was increasing on the department and if the ministry reduced the burden of pension then the department would be able to save Rs4 billion.

The committee was assured that there will be no downsizing and no employee would be sacked in case of public private partnership.