Privatization proceeds used for retirement of public debt

Staff Report

Maiden meeting of the Senate Standing Committee on Privatization, on a detailed briefing on the overall working and performance of the Ministry of Privatization and its attached departments/ sub ordinate offices, and on the consideration of the Bill titled “The Privatization Commission (Amendment) Bill, 2021” referred by the House, was held, under the chairmanship of Senator Shammin Afridi, here at the Parliament House, on Thursday.

In the meeting the Secretary, Ministry of Privatization, briefed the Committee on the Organizational Structure of the Ministry which is divided into, Privatization Division and Privatization Commission and is an independent Organization since 2017.

The Committee was apprised that 99% of the revenue generated by the privatization is utilized by the government for retirement of Federal Government debt (90%) and for poverty alleviation (10%).

Senator Sabir Shah commented, while briefing on the privatization process (strategic sale) on the monitoring and assessment of the process.

Replying to the question of Senator Sabir Shah, the official of the ministry said that the transaction structure is approved by the Federal Cabinet.

Question was further raised, whether or not; a comparison between the market price and reference price takes place before biding.

The officials of the Ministry said that world class financial advisors are appointed for the evaluation of entities.

The officials said that the privatization process holds complete transparency and goes through PC Board, CCoP and Cabinet for the reference price approval.

Senator Irfan Siddique raised an important question on whether who initiates decisions regarding the privatization of the entities. The official of the ministry said that the initial proposals are received by the cabinet committee.

Senator Anwar- ul-Haq Kakar recommended on making reforms on the process of privatization, he said that the unutilized land is the assets of our country and shall be retrieved for the economic interest of the country.

Senator Muhammad Qasim said that a stipulated time frame should be set, from the time of approval of the entity, for privatization, till the execution of sale, to keep the upwards trajectory of the economy.

Senator Mian Raza Rabbani held serious reservation on the approval for the privatization of the institutes.

He said that the approval of the Council of Common interest for privatization cannot be ignored, by law.

He raised the question that if a conflict of approval occurs between the Cabinet and the Council of Common Interest which decision will prevail.

The officials of the ministry said that the privatization process does not proceed if such a conflict occurs.

Senator Mehmood Hassan put forward his recommendation, on a thorough evaluation on whether an entity to be sold or put on lease for the preservation and protection of the assets of the government.

The members of the committee requested the Chair for time to deliberate upon the bill as they had received the copies of the bills, late in the evening, consequently, could not study the bill. The Chairman Committee deferred the bill, for consideration, in the upcoming meeting

The committee was attended by Minister, Mian Muhammad Soomro, Senator Anwar-ul-Haq, Mian Raza Rabani, Rana Mahmood ul Hassan, Syed Muhammad Sabir shah, Muhammad Qasim, Anwar Lal Dean, Molvi Faiz Muhammad.

Seniors officials from the Privatization Division and Privatization Commission and Ministry of Law and Justice were also in attendance.

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