‘Towards Light’


Not by a long shot!

‘Towards light’, the title the PML-N’s energy team gave to its policy document indeed sounds ironic. The paper is a most glaring testimony to the party leadership’s lack of vision and a thorough disregard for the lot of the common man. With one stroke of his indifferent pen the finance minister has pushed 50 per cent of the population below the poverty line. As if the phenomenal rise in power tariff was not enough, the ministry of petroleum has also raised the price of petroleum products. The double whammy would upset family budgets and cause widespread anxiety and unrest.

Those consuming 300 to 450 units would suffer the most. The fairly large section of the population comprises lower middle class. This category includes white collar office workers – clerks and accountants, lower grade bank employees, small traders, mechanics, skilled workers, school teachers and small landholders. They number in millions.

With a 30 per cent direct increase, this category will suffer for its bill will see a spike by a whopping 120 per cent. Add another 22 per cent of taxes, and the tab would reach the level of backbreaking. The hammering is three dimensional: a direct tariff increase of 30 per cent, a similar rise in taxes on bills and withdrawal of slabs for those using less electricity. The government’s decision will simply take electricity out of the fiscal reach of most of these people who have already seen their incomes shrinking owing to galloping inflation.

Adding further economic misery will be the rise in bus fares, resulting from the steep increase in petroleum prices. Increase in petrol prices will in turn jack up the prices of all commodities of daily use.

The lifeline consumers as well as those using up to 300 units would also suffer from the rising prices. Thus the majority of the population in this country will suffer from these two simultaneous measures.

The reason for the increase in power tariff given by Khwaja Asif brings under focus the incompetence of the PML-N administration. The petroleum minister argued before the Supreme Court that the rise was necessitated by the increasing cost of production caused by power theft. Why did the government not concentrate on stopping the theft instead if transferring the burden of the loss on the shoulders of those who are honest in paying their bills. It is like punishing a whole community for the crimes committed by a few individuals. What the PML-N government has done is to introduce the kind of collective punishment which is administered under the FCR in tribal areas. The innocents are to be punished for the transgressions of the criminals. It is bad governance to transfer the losses caused by the administration’s negligence to the man in the street.

The PML-N leadership knew very well about the sad state of the power sector. The matter had come under discussion several times in the parliament during the PPP tenure. Concerned officials had warned various parliamentary committees of the desperate situation on the ground.

Theft and line losses wasted up to 45 per cent power, according to a report presented before the National Assembly’s Special Committee on Energy Crisis by additional secretary Water and Power ministry early this year. He also presented a list of major defaulters. While a common defaulters’ connection is promptly turned off, government departments continued to be supplied power despite failure to pay bills. The meeting was informed that public and private departments jointly owed Rs426 billion, with federal government defaulting on Rs7 billion, Azad Jammu & Kashmir government on Rs19 billion, and provincial governments on Rs93 billion while industrial units of some ministers had altogether not paid billion of rupees.

Soon after the PML-N government assumed office in June came the warning from the Planning Commission that the power sector deficit could balloon to Rs742 billion in the current financial year. One had hoped the warning would lead the government to hasten recoveries and reduce line losses.

An apparently helpless minister for petroleum told the SC on Wednesday that in Peshawar only three to 20 per cent consumers paid their bills while the rest were involved in power theft. Is the federal government supposed to passively watch all this? Is it not duty bound to take action to resolve the matter? What Khwaja Asif did was to pass the buck on to the province ruled by a rival party. While the KP government run by an equally self-righteous and shortsighted leadership deserves to be taken to task for the negligence, the inaction on the part of the federal government is equally reprehensible. Why did Nawaz Shrif fail to resolve the issue at the recent CCI meeting? Doesn’t it show lack of competence?

The PML-N has leant nothing from the past. This explains why it felt no urgency to check power thefts and line losses which have in fact increased. The federal secretary Water and Power Saif Chattha told the Senate Standing Committee on the subject last month that thefts and line losses inflicted a mammoth loss of Rs150 billion in 2012-13. While 23,770 cases of power theft were registered, punishment was only given only in three cases. “The fine was no more than Rs5000 per case,” he added.

For the common man the present administration headed by Nawaz Sharif is as gutless as its predecessors.

Could the government find no out of the box solutions to keep the power tariff under control? Some think it could have provided gas to the power sector, thus producing electricity at a lower price. By allocating over 700 million cubic feet gas it could have generated 2,800MW at Rs5 per unit against Rs15 from thermal sources. By providing only 152 million cubic feet gas to some efficient plants near Lahore the government could start getting 840MW.

Special assistant to the prime minister on water and power, Musaddiq Malik has told a private TV channel that subsidy on power would require printing notes which would triple or quadruple inflation. Of course, nobody would like to have more inflation. But can Mr Malik think of no alternate way to raise funds other than printing currency notes? This shows the government has no eyes to see, and no ears to listen.

Why can’t government leaders tighten their belt thus saving millions of rupees instead of burdening the people? A lean and mean government could be the first right step in the direction. It could save money by downsizing a bloated state structure at the federal level which badly needs to be trimmed after the 18th amendment and the devolution that flowed from it. What is the need for a multi-billion rupee ministry of information secret fund? The huge expenditure of the cabinet division, the prime minister’s secretariat and the presidency need t be brought down. Why not privatize the state sector enterprises which are collectively bleeding the country by Rs360 billion a year?

Why can’t the government bring the section of the super rich into the tax net? The NADRA has identified 2.38 million people who live in palatial houses, own luxury cars, travel abroad frequently, possess licensed arms, hold multiple bank accounts and pay hefty utility bills, but file no income tax returns? Why must the government print currency instead of making these people cough up what it is their due?

The writer is a political analyst and a former academic.