Sir, here is a partial list of government-run entities: Lesco, Gepsco, Iesco, Fesco, Mepco, Hesco, Qesco, Genco-1, Genco-2, Genco-3, PIA, Pakistan Steel, Pakistan Railways, PTV, Pakistan Agricultural Storage, Utility Stores Corporation, Tomato Paste Plant, Roti Corporation of Pakistan, Pakistan Stone Development Company, Pakistan Hunting and Sporting Arms Development Company, Pakistan Gems and Jewellery Development Company, Technology Commercialisation Corporation of Pakistan, National Industrial Parks Development and Management Company, Technology Up-Gradation and Skill Development Company, National Insurance Corporation, Hazara Phosphate Fertilizers, Heavy Electrical Complex, Machine Tool Factory, Morafco Industries, National Power Construction Company, National Fertilizers Corporation, State Engineering Corporation, Pakistan Steel Fabricating Company Limited, Pakistan Mineral Development Corporation, Ghee Corporation of Pakistan, Republic Motors, State Cement Corporation of Pakistan, State Petroleum Refining and Petrochemicals Corporation, Pakistan Industries Development Corporation, Trading Corporation of Pakistan, Cotton Export Corporation of Pakistan, Rice Export Corporation of Pakistan, Pakistan Industrial and Technical Training Centre and Pakistan Engineering Company.
Sir, collectively they cost the treasury a colossal Rs500 billion a year, every year or Rs1.5 billion a day, every day of the year.
Sir, if the prime minister of Pakistan is the appointing authority of the heads of these government-run entities, then the prime minister is responsible for the Rs500 billion a year loss every year for his entire five-year term.
Sir, the root of all this evil is the mixing up of politics and business. The PPP refused to detach politics from business because it was bent upon extracting juice from the pulp. I hope – and pray – that your government has intentions different from the PPP’s.
Sir, please delegate your authority to an independent, high powered state-owned enterprises selection board (SOESB) with four specific functions: to be responsible for the selection and placement of the chairmen/managing directors; to be responsible for the setting of goals and a performance assessment framework (PAF); to be responsible for the formulation and the subsequent enforcement of a code of conduct for all chairmen/managing directors; to be responsible for the appointment, remuneration and dismissal of the chairmen/managing directors.
Sir, the only way out of the Rs500 billion mess is to establish a firm arms length relationship between the PM Secretariat and state-owned enterprises.
Sir, starting in 1841, the government of Canada has been successfully managing a whole host of Crown Corporations – including Canadian National Railways, Petro-Canada, Air Canada and Canadian Broadcasting Corporation – by establishing an arms length relationship and shielding these corporations from political intervention.
In 2010, the elected president of Ghana established the Ghanaian Constitution Review Commission (CRC). The CRC has diluted presidential powers to appoint heads of government institutions. It has been proposed to establish “a constitutional body similar to the Public Services Commission to appoint heads of statutory bodies and other state institutions.”
Sir, in Singapore the economy is completely dominated by corporations owned or controlled by the government (up to 60 percent of the GDP is produced by government-linked corporations). Temasek Holdings, the government-owned corporation, controls assets worth $160 billion that include Singapore Airlines, Sing Tel, MediaCorp, Singapore Power, Singapore Zoo, Standard Chartered and Bank of China. The Singapore government, however, is “not involved in Temasek’s investment, divestment or any other business of operational decisions.”
Dear Mian Sahib, Temasek made $12 billion last year and we lost Rs500 billion the same year.
The writer is a columnist based in Islamabad. Email: firstname.lastname@example.org. Twitter: @saleemfarrukh
Keywords: Economics , Economical issues , Agricultural growth , Political interventions , Economy , PIA , Railways , Mian Sahib , China , Singapore , PAF , CRC , PPP