Islamabad September 21 2023: Owing to inefficiencies and mismanagement, the deficient State-Owned Enterprises (SOEs) incurred overall losses of around PKR 500 billion to the national exchequer during last year (2022), Caretaker Federal Minister for Finance, Revenue, Economic Affairs, Dr Shamshad Akhtar said on Thursday.
Addressing a press conference, the minister said that there were also profit-making enterprises, which earned an aggregate profit of PKR 330 billion out of which PKR 185 billion was made by oil and gas companies.
In past, the minister said, the governments had established a range of SOEs with good objectives and these promoted economic development besides providing essential public services. She said, these enterprises spanned over energy, telecommunications, transportation, trade, marketing and financial sector.
However, she added, these entities suffered due to lack of autonomy, external interference, weak management, limited accountability, inappropriate boards, which she said resulted in financial losses and decline in quality of services. “There has been massive drain in public resources.”
However, the minister added, when privatized, the banking industry was one of the biggest success stories in Pakistan which transformed from loss-making to profitable.
Shamshad Akhtar said the overall performance of SOEs was not very healthy what she called “contrary to the expectations” adding that some of these were marred by inefficiencies and mismanagement.
Elaborating upon the SOEs, she said that there were both non-commercial as well as commercial organizations included in it. She said 85 commercial SOEs could pay dividends and some of them could be profitable and some were already earning profits. Out of these, she said 20 enterprises were in power sector, 17 in infrastructure and 14 in mineral, manufacturing and mining.
Top ten profit earning organizations
She also shared the list of top ten profit-earning and loss-making organizations of the fiscal year 2020. Among the profit-earning companies Oil and Gas Development Company Limited made profit of PKR 100.08 billion, followed by Pakistan Petroleum Limited with PKR 49.4 billion, National Bank of Pakistan with PKR 30.6 billion, Government Holdings (Private) Limited with PKR 29.8 billion, National Power Parks Management with PKR 28 billion, Port Qasim Authority with PKR 15.4 billion, National Transmission and Despatch Company with PKR 9.3 billion, Pak Kuwait Investment Company (Private) Limited with PKR 6.3 billion, Faisalabad Electric Supply Company Limited with PKR6.08 billion and Pakistan Agricultural Storage and Services Corporation Limited with PKR 6.02 billion.
Top ten loss making organizations
Among the loss-making entities, Quetta Electric Supply Company incurred loss of PKR 108.5 billion, followed by National Highway Authority with loss of PKR 94.3 billion, Pakistan Railways with PKR 50.2 billion, Sukkur Electric Power Company with PKR 40.8 billion, Pakistan International Airlines PKR 36.07 billion, SSGCL PKR 21.4 billion, Pakistan Steel Mills PKR 20.6 billion, HESCO PKR 17.7 billion, Pakistan State Oil Company PKR 14.8 billion and Peshawar Electric Supply Company PKR 14.6 billion
The minister said that the government was in process of reviewing State-Owned Enterprises Policy which would be finalized after incorporating comments of stakeholders. She said the aim of the new policy would be capacity building of SOEs adding that a data hub has also been established to monitoring performance of these SoEs.
To a question about privatization of these entities, she said Federal Ministry of Privatization has important role to go through the process and Ministry of Finance had only advisory role.