Finance Minister Muhammad Aurangzeb talking on the Pakistan Coverage Dialogue in Islamabad Picture: Screengrab
ISLAMABAD:
Finance Minister Muhammad Aurangzeb on Monday went on the again foot and blamed the media for “selective studying and reporting” of an official report on State-Owned Enterprises (SOEs), which disclosed that web money returns by these entities dropped 91% and their web losses jumped 301%.
As an alternative of addressing a press convention, the finance minister issued a recorded video by which Aurangzeb claimed there had been “selective interpretation, reporting and selective studying of the report, which is opposite to the details”.
However the finance minister didn’t quote a single truth in his over 12-minute video assertion that was not given within the report and reported by the media.
The minister issued the video after the finance ministry on Friday launched an in depth annual mixture report on SOEs for the fiscal 12 months 2024-25, which additionally disclosed that the SOEs’ funds and governance had deteriorated within the final fiscal 12 months. “Combination losses have been reducing during the last three consecutive years, mentioned Aurangzeb. “In 2023, the combination losses had been Rs905 billion, which declined to Rs851 billion in FY24, and final 12 months it was Rs832 billion. So, if we see that during the last three years, the losses have declined by Rs74 billion,” he mentioned.
The minister mentioned losses had been decreased by Rs823 per day over the previous three years. Aurangzeb admitted that oil and fuel sector profitability declined within the final fiscal 12 months resulting from decrease world oil costs, regardless of improved operations.
He mentioned that mixture and annual losses of state establishments have declined over the previous three consecutive years.
All these entities have put a mixed burden of Rs2.1 trillion on the federal government within the final fiscal 12 months, he admitted, including that final 12 months the outflow from SOEs was about Rs2.078 trillion whereas the influx was Rs2.119 trillion. “There’s a constructive influx of Rs40 billion to the federal government of Pakistan,” he mentioned.
In response to the finance ministry, web money returns by SOEs to the federal government dropped sharply by 91% to Rs40.7 billion. Internet fiscal circulation, calculated because the distinction between SOE contributions to the federal government and monetary assist obtained by fairness injections, grants, subsidies, loans and ensures, declined dramatically.
The report mentioned web fiscal circulation fell from Rs458.2 billion within the earlier fiscal 12 months to simply Rs40.7 billion in fiscal 12 months 2025. “This sharp discount highlights a considerable decline within the web money returns supplied by SOEs to the federal government,” it mentioned.
In response to the finance ministry, there was an total web lack of Rs122.9 billion for the SOE sector, in contrast with a web lack of Rs30.6 billion within the earlier 12 months, translating right into a 301% improve inside one 12 months as an alternative of any enchancment in monetary efficiency.
Aurangzeb vowed full disclosure in mixture SOE reviews, together with the availability of analytical evaluation.
He mentioned the federal government had taken steps to enhance governance in these establishments by appointing impartial personal sector board members.
Though exterior audits are obligatory for SOEs, the report disclosed that lower than 36% had been implementing the requirement.
The finance minister mentioned the federal government had requested for enterprise plans from these SOEs, that are being evaluated on the central monitoring unit. However his ministry’s report disclosed that these enterprise plans had been “descriptive” and constructed on the hope of “constructive outcomes” as an alternative of getting ready these plans on the idea of some evaluation.
He mentioned a number of establishments have already shut down or are within the strategy of closing. “These closures have been carried out transparently. The primary concern with these entities was that they had been receiving billions of rupees in subsidies, and there have been issues of theft, leakage and corruption,” he mentioned.
The finance minister claimed there are a number of extra entities on this class, and additional choices might be made on the general rightsizing of the federal authorities
A few years in the past, the federal government had handed over 26 entities to the Privatisation Fee on the market. Up to now, 75% stakes of PIA have been bought whereas one small financial institution has been bought beneath a negotiated sale.
“We is not going to cease at 26 SOEs; further SOEs will step by step be handed over to the Privatisation Fee,” mentioned Aurangzeb. “The privatisation of PIA was performed transparently, and management might be transferred to non-public sector sponsors in April,” he mentioned.
“The privatisation strategy of ZTBL (Zarai Taraqiati Financial institution Ltd) is at a sophisticated stage, and it’ll quickly be introduced to the Cupboard Committee on Privatisation. Equally, HBFC can be being actively reviewed,” he mentioned.
He mentioned the monetary advisors of the 5 energy distribution corporations had been appointed and these entities could be bought throughout this 12 months. It’s the prime minister’s clear directive that the privatisation course of ought to transfer ahead with transparency and pace, he added.
