ISLAMABAD: The government has decided to maintain nine federal entities in the public sector by classifying them as essential state-owned enterprises (SOEs).
The Cabinet Committee on State-Owned Enterprises made the decision in its meeting on Thursday, chaired by Finance Minister Muhammad Aurangzeb, which also approved the reorganisation of the boards of three SOEs.
The government assured the International Monetary Fund that all SOEs would be classified into four categories. As a result, the government implemented an SOE Policy in 2023. Each ministry is entrusted with presenting a basis for classifying SOEs into specific categories.
These categories include “strategic” or “essential” SOEs, which are critical to implementing government programmes and cannot be carried out by the private sector. Three more groups include commercial SOEs that will be privatised, those that must be restructured and retained in the medium term, and those that must be restructured before privatisation.
Committee also okays reconstitution of boards of three public firms
Based on this policy, the cabinet committee on SOEs discussed the Ministry of Communication’s proposal regarding categorising the National Highway Authority. At the meeting, it was stated that the NHA is critical in implementing government policies with significant security and social and economic impact.
After careful consideration, the committee approved the proposal and categorised the NHA as an essential SOE.
The meeting also approved the proposal of the communication ministry by declaring the Pakistan Post Office Department as a strategic and essential SOE under Paragraph 9 of the SOEs (Ownership and Management) Policy 2023.
Likewise, the cabinet committee also considered the summary of the Ministry of Defence Production for the categorisation of Pakistan Ordnance Factories (POF), Heavy Industries Taxila (HIT), Pakistan Aeronautical Complex (PAC), Karachi Shipyard & Engineering Works (KS&EW), National Radio Telecommunication Corporation (NRTC), and Telephone Industries of Pakistan (TIP).
The meeting was informed that these establishments are engaged in national security and defence-related activities that fulfill the operational requirements of the Armed Forces. The meeting approved the proposal for further submission to the federal cabinet for final approval.
The committee also approved the Ministry of Water Resources’ proposal to categorise the Water and Power Development Authority (Wapda) as an essential SOE. It was further directed that Wapda align its Governing Act in consonance with the SOEs Act.
The meeting approved the reconstitution of the boards of directors of the Central Power Purchasing Agency Guarantee Ltd (CPPA-G), Power Planning and Monitoring Company (PPMC), and Power Information Technology Company (PITC). The proposal also included the nomination of independent directors, ex-officio directors, and the chairman of each board.
After consideration, the cabinet committee on SOEs approved the nominations, thereby reconstituting the boards of CPPA-G, PPMC, and PITC. The meeting emphasised the importance of strategic oversight and effective governance of SOEs to ensure their contribution to national development objectives.
Published in Dawn, September 13th, 2024
