No privatisation in fiscal year 2011: Hafeez vows to restructure PSEs

June 06, 2010

MUSHTAQ GHUMMAN

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Privatisation as an economic tool to lower the haemorrhaging of the Budget still needs a political consensus within the Pakistan People''s Party as nil inflow from privatisation process has been shown in the 2010-11 budget documents.

In the 2009-10 budget, the government had shown privatisation proceeds of Rs 19.351 billion, but nothing materialised throughout the year. Federal Finance Minister Dr Abdul Hafeez Shaikh informed the National Assembly that without reduction of the burden of Public Sector Enterprises, the country will never be able to achieve a sustainable fiscal situation. The productivity and efficiency of every sector of our economy stands compromised. Lack of attention to reform of PSEs is subverting all efforts at stabilisation and economic revival, he added. The Finance Minister committed to restructure eight PSEs (Pepco, Railways, PIA, TCP, Passco, Steel Mills, NHA and Utility Stores).

A restructuring model with time lines approved by the cabinet will be implemented to make PSE solvent, committed Hafeez. According to the documents, total estimated external and external resources will be Rs 2597.893 billion, against current year''s initial estimates of Rs 2298. 813 billion and revised Rs 2496.448 billion. External resources are expected to be Rs 386.620 billion as compared to original Rs 510. 413 billion and revised estimates of Rs 577. 985 billion for 2009-10.

The comparative budgetary position of 2009-10 and 2010-11 shows that expenditure will be at Rs 2764.437 billion against Rs 2462.130 billion earmarked in the budget but revised up to Rs 2585.557 billion. The government has estimated to borrow Rs 166.544 billion during 2010-11 as compared to 2009-10 budget target of Rs 144.146 billion, which was revised downward to Rs 89.109 billion.