From Nepra to NAB

September 23, 2019


THE power-sector regulator, Nepra, has included some extraordinary language in its latest flagship State of the Industry Report pointing to the damage that NAB has done to its operations, as well as the failure of long-term power-sector reforms. It laments that NAB is straying into the regulator’s jurisdiction, a complaint that is perhaps inspired by the detention of some Nepra officials by the anti-corruption watchdog. “Almost all the projects on which Nepra had made determinations in the past have been questioned by NAB, and the way the investigations are being conducted, it has completely stifled the morale of Nepra professionals,” the report says. This is the first time that the State of the Industry Report has been used as a vehicle to advance such grievances, and it shows the extent to which the damage wrought by the so-called accountability drive is being felt. NAB officials do not have the capacity to understand complex topics such as tariff determinations, yet they have the power to detain first and ask questions later. Even in cases where they seek to understand complex agreements or calculations, those who have engaged with them find that it can be an extremely vexing experience to try and explain these matters to them.

What is troubling about Nepra’s warning is that the damage being done could end up carrying a steep price tag, and it is the citizens who will eventually have to pay. If NAB inquiries result in officialdom being afraid to take decisions, simply out of fear that they will be made to explain their decisions later to people who do not possess the capacity to understand them, then it will result in severe demoralisation, perhaps enough to jam the wheels of government. That is precisely what Nepra seems to be warning about. To top it off, the regulator also warns that the status quo is in dire need of reform, and some near-momentous changes are needed in the immediate term. The cost of this failure is evident in the circular debt, which the report says had crossed Rs1tr by the end of last year. The minister for power seems to be pleased with his efforts to enhance recovery and contain the flow of circular debt. But the fact is that without deep-rooted reform, the problem will keep recurring. And this reform is not going to come about so long as government officials have to work with a gun held to their heads.

Published in Dawn, September 23rd, 2019