ECC approves Rs30.2b grant for closure of USC stores

ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet approved a technical supplementary grant of Rs30.216 billion for the ‘smooth” closure of the Utility Stores Corporation (USC).

The ACC approved the grant at a meeting chaired by Finance Minister Muhammad Aurangzeb. It was decided that the funds would be used ensure an orderly shutdown of USC operations, which have long posed a financial burden on the national budget.

The approved amount will cover severance packages, compensation, and outstanding dues owed to USC employees, ensuring that entitlements are paid and the social impact of the closure is managed.

A press release issued by the finance ministry also said that the ECC has directed the Ministry of Industries and Production to rationalise the financial needs related to USC’s closure. It was also decided that USC’s assets, including its properties, be sold within the current fiscal year to offset part of the closure costs.

Utility stores closure, but at what social cost?

To ensure transparency and fiscal responsibility, the committee also stressed that the winding down process must be carried out in a structured manner.

The meeting was attended by Federal Ministers Rana Tanveer Hussain (National Food Security), Jam Kamal Khan (Commerce), Sardar Awais Ahmad Khan Leghari (Power; virtually), Special Assistant to the Prime Minister Haroon Akhtar Khan (Industries and Production), along with senior officials from relevant ministries and departments.

In July, the federal government had officially announced that the operations of all Utility Stores Corporation (USC) stores will be shit down across the country.

According to an internal notification, issued by the General Manager of Stores Operations and Services (SO&S), all sales and purchase activities at utility stores across the country have been terminated with immediate effect from July 31, 2025.

The decision stems from the Prime Minister’s instructions dated June 28 and the outcome of the 190th meeting of the Board of Directors held on July 2. The move brings an end to decades of subsidised grocery operations at government-run outlets that served millions of low-income households nationwide.

The Utility Stores Corporation, operating under the Ministry of Industries and Production, had faced growing financial challenges and criticism over alleged mismanagement and inefficiencies in recent years.