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PML-N wants power distribution companies under provincial control

Senator Ishaq Dar, former finance minister, has asked the federal government to hand over administrative and financial control of electric power distribution companies to provinces with an aim to reduce line losses, combat electric theft and increase efficiency and recovery of bills.

He came up with this proposal at a meeting of the Senate committee on finance which is in the process of finalizing its recommendations to be forwarded to the National Assembly for approval.

Dar also pitched number of proposals which are very important in terms of reducing non-development budget and increasing revenue mobilization.

However, Senator Haji Adeel opposed the proposal marketed by Dar.

Talking about hydro-generation in Tarbela, he said that Khyber Pakhtunkhuwa (KPK) feeds the entire country but the province is not being rewarded.

Dar said that the electricity crisis is the most problematic issue owing to which the country is sustaining 2-3 percent loss of the GDP which amounts to Rs500 billion in every year.

Dar also asked for the re-appropriation of development budget to divert more funds to cope with the crippling energy crisis arguing that the proposed allocation of Rs68 is a meagre amount if compared with adverse impact of the energy crisis.

Ms Sughra Imam said that the federal share in the development budget stands at Rs360 billion out of which Rs68 billion is earmarked for energy projects.

However, she said that power distribution companies and Water and Power Development Authority (Wapda) would generate additional Rs115 billion to complete the projects.

She said that non-development budget of Rs360 billion is 15 percent of the GDP whereas the expenditure budget stands at 85 percent of the budget.

Dar said that he is emphasising over re-appropriation of funds from the federal share in the development budget as in expenditure budget there is no room to save the amount to divert more funds to overcome the energy crisis.

Sughra Imam, however, further argued that Rs360 billion is not a big amount for projects to be completed in Balochistan, Khyber Pakhtunkhuwa and in other federating units and if it is further re-appropriated then the development activities would be affected.

However, it was decided that the issue must be deferred till Friday (today) as the committee would initiate the discussion on development budget.

Some members who took part in the discussion said that the sizeable amount in all projects pertaining to alleviative the poverty should be diverted to resolve the energy crisis and solve the circular debt.

They said that allocation of Benazir Income Support program has been enhance by Rs10 billion to Rs60 billion from Rs50 billion.

The increase of Rs10 billion should be diverted to cope with the energy crisis.

“Likewise, the administrative cost of all poverty alleviation related project should be reduced by establishing their one secretariat.”

The members from PPP in Senate pointed out about the proposal marketed by Chaudhry Shujaat, PML-Q leader, prior to energy summit that was held in Lahore and said that to overcome energy crisis, provinces should come forward and spare reasonable amount from the resources which have been enhanced in the wake of implementation of the NFC Award.

Dar responded by saying that provinces have no room to divert resources to overcome energy crisis and circular debt.

He, however, said that receivables under Central Power Purchase Agreement have increased to Rs350 billion out of which provincial governments owe Rs80-90 billion.

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