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PPP, privatisation, or ‘provincialisation’: parliamentary forum debates solutions for inefficient DISCOs


ISLAMABAD: Speakers at a seminar held here on Tuesday, agreed that electricity distribution companies (DISCOs) were exacerbating the problems being experienced by the energy sector and the national economy.

They also unanimously recommended that the DISCOs need immediate but well thought-out reformation and restructuring, otherwise they will continue to add to both the energy crisis and the circular debt.

The seminar, titled ‘Privatisation-the only solution for electricity distribution companies’, was organised by the Parliamentary Forum on Energy and Economy, a newly created cross-party group of the members of the National Assembly.

Addressing its participants, Speaker of the National Assembly Ayaz Sadiq emphasised the need for non-partisan and deep deliberations on the issues and problems concerning DISCOs. He said that the government should take itself out of running any business, including DISCOs, and also highlighted the need for an informed parliamentary and policy debate so that any negative fallouts of privatisation can be both predicted and prevented.

“We need the right person for the right job whether it is in the government or in the private sector, otherwise our situation will become worse before it can get better,” he said.

Syed Naveed Qamar, senior parliamentarian and former minister of privatisation, also told the audience that it is the management of a company that matters, not its ownership. “Even in DISCOs, you see that some of them running efficiently [and those that are] doing well, there is no need to privatise [them]”, he said.

He also advocated a diversified approach to address the problems plaguing DISCOS. “While most of these problems can be removed by improving their management, we also need to keep in mind the peculiar situation of each DISCO to decide how to reform or restructure it”.

He said that the regulator must live up to its role and not just act as a power tariff setter.

Dr Nafisa Shah, senior parliamentarian and the convener of the Parliamentary Forum on Energy and Economy, said that energy crisis has become so severe that it is now threatening the entire national economy. “We need to debate and address it in a non-partisan manner and that is why we have set up this forum as well,” she said.

The seminar also included presentations by energy experts Shaheera Tahir, Rimsha Rehan, and Manzoor Alizai on the need for reforming and restructuring DISCOs. The experts analysed and critiqued various options under consideration for the same purpose. They highlighted the pros and cons of public-private partnerships and management concessions, and also proposed ‘provincialisation’ as an alternative to the privatisation of DISCOs.

Tahir Basharat Cheema, former head of Pakistan Electric Power Company (PEPCO), shed light on the costs and benefits of privatising DISCOs. He proposed the solution of allowing the private sector to take over the management of these companies instead of fully privatising them. He said that it could lead to “marked improvement” in the performance of DISCOs.

Summing up the proceedings of the seminar, Dr Amjad Ali Khan, a parliamentarian from Swat, said that the provincial governments should be engaged in debates and discussions about DISCOs and they should have the authority to take decisions pertaining to the DISCOs in their respective jurisdictions.

“Once the DISCOs are handed over to the provincial jurisdiction, the authorities concerned can aim to improve their management or opt for public-private partnerships.” He said that this might also promote investments in DISCOs.

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