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March 5, 2020

Discos told to disconnect 400 defaulters by tomorrow

Top Story

March 5, 2020

ISLAMABAD: In a late night development, the government took a bold step and issued orders to disconnect the electricity supply connections of top major 50 running defaulters in each Electric Power Distribution Company (Disco) by tomorrow (March 6) at the end of office hours. This means that 400 private top running defaulters across the country will be disconnected from the electricity supply.

The running defaulters are said to be very influential and most of them have political tentacles and in the Discos no one can dare to disconnect their electricity connection knowing the fact they are not paying the bills. And in some cases they have managed to get the stay orders owing to which the Discos are not able to collect the dues, but bound to provide the electricity too. The running defaulters owe huge amount of Rs525 billion to the government. However the permanently disconnected owe Rs103.202 billion to Discos.

Spokesman of Power Division Zafar Yab Khan confirmed the development saying that this action will help increase the volume of receivables from the running defaulters. ‘Now the electricity will be restored once the bills are paid.’

Prime Minister Imran Khan already showed the dismay over the continuation of electricity supply to the private running defaulters and ordered to immediately disconnect their connections.

‘In line with the Prime Minister’s orders, with the approval of Federal Minister of Energy Omar Ayub Khan, Power Division on Wednesday night ordered Chief Executives Officers (CEOs) of all Electric Power Distribution Companies (DISCOs) to disconnect the electricity supply connections of top 50 running defaulters in each of Disco with immediate effect. The CEOs of all Discos have been asked to submit the compliance report to the Power Division by end of office hours on March 6 (tomorrow).‘

Running defaulters mean those who default but continue to use the electricity because of the stay orders by the courts and some of those who default by the government continue to provide electricity to agriculture tube wells in the Balochistan. Though Balochistan is not paying the 60 percent of subsidy on Agri tube wells so in this case Agri tube wells in Balochistan are being treated as running defaulters.

The independent experts say that Rs525 billion is the low hanging fruit for the government to pluck and improve the fiscal situation of the power sector. They suggested that the government is badly needed to either recover the electricity dues from the running defaulters or confiscate their properties through the land revenue board.

The government action to disconnect the running defaulter from supply of electricity is a good omen and it will send the strong message to the defaulters to first pay and then use the electricity.

According to the presentation of Discos on line losses, recovery and AT&C losses till December 2019 available with The News, till December 2019, the dues of the running defaulters have scaled up to Rs524.550 billion.

Almost the huge amount of Rs346 billion, that has been accumulated on account of those consumers who stayed defaulted for more than three years’ time, exposing the inefficiency of top mandarins of the ministry during incumbent regime as they have failed to recover the huge amount from them knowing the fact that this is the low hanging fruit.

The document also discloses saying that the running defaulters who stayed defaulted for over two months are needed to pay over Rs22 billion, and those who got defaulted for one month time owe Rs1.7 billion, for 3 months time needed to pay Rs4.327 billion, for 6 months time owe Rs839 billion and for 12 months time required to pay Rs22 billion and those who are declared defaulted for the last over three year are needed to pay Rs346 billion.

Out of the huge amount of Rs405 billion that is needed to be recovered, the running defaulters in jurisdiction of Lahore Electric Supply Company (Lesco) owe to pay Rs7.835 billion followed by the defaulters in Gujranwala Electric Power Company (Gepco) who are needed to pay Rs1.550 billion, in Faisalabad Electric Supply Company (Fesco) Rs1.232 billion, in Islamabad Electric Supply Company (Iesco) Rs1.231 billion. The Iesco is considered the best among the ten Discos but it has also failed to receiver Rs1.231 billion from the chronic defaulters. In Mepco, the running defaulters require to pay Rs2.610 billion. The date about Punjab Discos shows that in Lesco, the receivables from the running defaulters are the highest meaning by that Lesco is the most inefficient entity in the Punjab province.

However, Quetta Electric Supply Company (Qesco) has emerged as most inefficient Disco in the country wherein the running defaulters which also include the agricultural tube wells owe Rs196.006 billion to pay, followed by defaulters in Sukkar Electric Supply Company (Sesco) who owe Rs71.247 billion, in Peshawar Electric Supply Company (Pesco) Rs53 billion and in Tesco Rs34.437 billion.

Highlighting magnitude of the contribution of permanently disconnected defaulters to the menace of the circular debt, the document also painted the bleak picture as they need to pay Rs95.352 billion. Under this head those who stayed as permanently disconnected defaulters for more than three years owe Rs79.9 billion to Discos and those who remained in this category of defaulters for 3 years are needed to pay Rs10.005 billion, and defaulters for 12 months time are required to pay Rs3.11 billion, for 6 months time Rs1.259 billion, defaulters of 3 months Rs211.67 million, and defaulters who got permanently disconnected for two months time are needed to pay Rs825.93 million.