ISLAMABAD: The government has proposed to merge the Public Private Partnership Authority (P3A) with the Privatisation Commission (PC) by reconstituting the latter as the Privatisation and Public Private Partnership Commission, with a view to establishing a unified institutional framework for privatisation and public-private partnership (PPP) transactions.
According to official documents, the proposed Privatisation Commission (Amendment) Bill, 2026, envisages repeal of the Public Private Partnership Authority Act, 2017, dissolution of P3A and transfer of its assets, liabilities, funds, functions and pending proceedings to the reconstituted Commission.
The legislation, which has been introduced in Parliament on October 22, 2026, seeks to consolidate institutional arrangements for privatisation and PPP projects under a single framework, enabling more efficient and expeditious execution of transactions.
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According to the explanatory material accompanying the Bill, the Privatisation Commission was originally established under the Privatisation Commission Ordinance, 2000, to implement the Federal Government’s privatisation policy and ensure a fair, transparent and competitive process based on due diligence, equity and justice.
The P3A, meanwhile, was established under the Public Private Partnership Authority Act, 2017, to promote domestic and foreign private investment in development projects, expand public infrastructure and improve the reliability and quality of public service delivery.
The administrative control of P3A was transferred from the Planning, Development and Special Initiatives Division to the Privatisation Division by the Cabinet Division with effect from May 11, 2026, to ensure closer institutional alignment between privatisation policy and the implementation of PPP projects.
In pursuance of the Prime Minister’s directive, the Privatisation Division subsequently constituted a committee under the chairmanship of the Minister for Law and Justice to finalise amendments to the relevant legislation and rules.
The committee comprised the Minister for Economic Affairs, Advisor to the Prime Minister on Privatisation, Minister of State for Finance, Secretary Cabinet, Secretary Privatisation Division, Secretary Law and Justice, Chief Executive Officer of P3A and Secretary Finance.
The committee was tasked with reviewing and finalising amendments to the Public Private Partnership Authority Act, 2017, and other relevant laws to enable effective and immediate implementation of the proposed institutional mechanism.
Under the proposed arrangement, P3A will function as the implementing arm for execution of PPP projects, subject to regulatory and policy oversight of the Cabinet Committee on Privatisation (CCoP). Both qualified and unqualified projects will be submitted to CCoP for approval.
The Risk Management Unit of the Ministry of Finance will continue to conduct due diligence in cases involving fiscal and sovereign guarantees extended by the government, subject to prescribed processing timelines.
The committee held several meetings and agreed on amendments to the Privatisation Commission Ordinance, 2000, to accommodate the new mechanism, while the Public Private Partnership Authority Act, 2017, would stand repealed.
The proposed legislation provides for a number of institutional and operational changes, including reconstitution of the Commission’s Board with a majority of independent members, representation of members having experience in PPP projects and at least two women.
The Board members will have fixed terms of office, while the legislation also provides clear grounds for disqualification and removal to strengthen institutional governance.
The reconstituted Commission will be empowered to advise on, appraise, structure, facilitate and monitor PPP projects, in addition to undertaking its privatisation-related responsibilities.
The Bill also envisages establishment of a viability gap fund, a PPP project development facility and a public contribution fund to support the implementation and development of PPP projects.
A comprehensive legal framework for public-private partnerships has been incorporated through a new Part V-A of the Privatisation Commission Ordinance.
The proposed framework covers PPP agreements, establishment of a federal PPP pipeline, approval procedures, the Risk Management Unit, PPP transaction execution committees, PPP nodes within government agencies, settlement of disputes and an alternative process for projects falling below prescribed thresholds.
The legislation also provides savings and transitional arrangements for PPP projects initiated under the Public Private Partnership Authority Act, 2017, to ensure continuity following the repeal of the existing law and transfer of P3A’s functions to the Commission.
The Cabinet Committee for Disposal of Legislative Cases (CCLC), during its meeting held in October 2026, considered the summary submitted by the Privatisation Ministry regarding the proposed amendments and approved the proposal.
The proposal was subsequently ratified by the Federal Cabinet on October 18, 2026.
The Privatisation Commission (Amendment) Bill, 2026, was thereafter processed through the Law and Justice Division and the Parliament Affairs Division before its introduction in Parliament on October 22, 2026.
The proposed merger is aimed at streamlining institutional responsibilities, eliminating fragmentation between privatisation and PPP arrangements and providing a consolidated mechanism for appraisal, approval, structuring and execution of infrastructure and investment projects.
Copyright Business Recorder, 2026
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