LAHORE: Lahore Electric Supply Company (Lesco) Board of Directors chairman Musadik Malik faces ministerial charge-sheet for the company’s “alarmingly poor performance.”

Mr Malik is also adviser to and spokesman for Prime Minister Nawaz Sharif.

In a letter to the BoDs chairman, who also enjoys the status of minister of state, the Pakistan Electric Power Company (Pepco) has asked Mr Malik and Chief Executive Officer Qaiser Zaman to explain why they have failed to improve the company which has a dismal record on all concrete performance indicators.

The “grave situation” at Lesco not only reflects absence of effort on the part of the CEO but also indicates lack of robust performance monitoring and review mechanism by the Board of Directors “to turn the company around as desired by the government and intended in letter and spirit of Public Sector Companies (Corporate Governance) Rules, 2013.”

“No tangible disciplinary action has been taken against poor performers, showing connivance of higher management with the culprits. No concrete efforts have been made to curtail theft of electricity,” the letter says.

It further reads: “In recent performance review undertaken by the Secretary Water and Power, it was noticed that the company has performed poorly during December 2014 and June 2015, even by its own standards of the corresponding period last year. The company has running default of Rs822 million, but none of the consumers was disconnected. The recoveries have fallen to 96.80 per cent, which were 103.40 per cent during the corresponding period last year. The Transmission and Distribution (T&D) losses have jumped to 14.2 per cent against permissible limit of 11.75 per cent.”

Also, Lesco has failed to finalise reconciliation with the Punjab government regarding receivables against government departments and GST against agriculture tubewells. The third-party study of transmission and distribution losses has also been delayed. Heavy credit adjustments ranging between two and 4.4 per cent have been made against the given target of 0.01 per cent. A total of 123 defective meters on government department premises, which were noticed at the June 2015, still exist, deplores the letter.

“Overbilling to provincial department continues to cover up line losses. Only 39 sub-divisions were for mobile meter reading against a target of 80, out of total 163 sub-divisions. Recovery from private agriculture consumers remained unsatisfactory and court cases regarding billing and tariff disputes have not been pursued properly.

“In light of the all-out support and attention by the government to Lesco, it won’t be out of place for the competent authority to expect immediate remedial measures to significantly improve the performance of the company against tangible and measurable criteria as indicated above,” the warning says.

The Lesco CEO had already been issued a show-cause notice on Ramazan 1 for selling electricity to industrial consumers instead of the common man to ensure loadshedding-free Sehr and Iftar.

Published in Dawn, August 6th, 2015

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