PTI govt suspends operations at Utility Stores Corporation

[Devil Soul]

PTI govt suspends operations at Utility Stores Corporation
By Zafar Bhutta
Published: August 30, 2018
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The USC was profitable during the Pakistan Peoples Party’s (PPP) tenure. However, since the Pakistan Muslim League-Nawaz (PML-N) government, the corporation’s fortune took a turn for the worse. PHOTO: FILE

ISLAMABAD: The Pakistan Tehreek-e-Insaaf (PTI) government has decided to temporarily suspend operations at the Utility Stores Corporation (USC) after deciding to stop procurement of all commodities.

According to the official order issued by the USC management, as directed by the joint secretary ministry of industries and production, the minister and secretary have directed to stop all kind of procurements at the regional and head offices immediately until further orders.

The USC provides daily use items to low income group at discounted rates. It has 5,500 retail outlets across the country and an employee base of 14,500.

The decision to halt procurement was issued by Adviser to Prime Minister on Industries and Production Abdul Razzaq Dawood and Ministry of Industries and Production secretary as the utility is embroiled in a financial crisis. However, the directive raises a question mark over how the decision could be issued in presence of the utility’s board of directors.

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At present, the USC has an inventory worth Rs4.5 billion, which it had procured to meet requirements of utilities across the country. Its monthly revenue is around Rs1 billion. Officials said that Adviser to Prime Minister on Industries and Production had also planned to shut down USC during the Musharraf era but could not succeed.

The USC was profitable during the Pakistan Peoples Party’s (PPP) tenure. However, since the Pakistan Muslim League-Nawaz (PML-N) government, the corporation’s fortune took a turn for the worse. Pakistan International Airlines (PIA) and Pakistan Steel Mills (PSM) have also been running on bailout packages due to losses worth billions of rupees.

The USC faced a loss of Rs1.36 billion during the first quarter of financial year 2017-18 with negative equity of Rs1.808 billion and outstanding amount of Rs5.6 billion to its vendors. Consequently, most vendors had stopped supplying stocks to the corporation.

In 2010-11, during the PPP government, its profit was Rs843.19 million and subsidy was Rs8.9 billion. Its profit dropped to Rs775.28 million in 2011-12; however, subsidy increased to Rs12.4 billion. In 2012-13, USC’s profit jumped to Rs1.399 billion and subsidy also increased further to Rs18.53 billion to provide commodities at discounted rates.

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However, when the government of PML-N came to power, the profit of the utility turned into a loss of Rs202.32 million in 2013-14 and subsidy also declined to Rs12.544 billion.

Official indicators point to bleak economic outlook

The loss of the utility continued to increase to Rs3.94 billion in 2016-17. Its sale also decreased from Rs68.91 billion to Rs57.91 billion in 2016-17. The Ministry of Industries and Production blamed the loss on the nomination of a private board of directors during the previous government, saying that it had no experience of USC’s functions.

Published in The Express Tribune, August 30th, 2018.

 

[Peaceful Civilian]

Good decision, no point to continue it as we already in financial crises. Need to take away subsidy in other departments too and save tens of billions of rupee.

 

[war&peace]

The USC was profitable during the Pakistan Peoples Party’s (PPP) tenure. However, since the Pakistan Muslim League-Nawaz (PML-N) government, the corporation’s fortune took a turn for the worse.

That's why I say PMLn Patwaris are much bigger thieves than PPP.
PPP may leave a few things uncorrupted but PMLn won't spare anything.

 

[WarKa DaNG]

When will we get rid of these peoples

 

[maithil]

Arent such stores supposed to cater to lowest strata of society ? Closing these will hit them hard. Subsidizing corporate in hundreds of billions, but stopping subsidy of poor is not exactly a sound idea.

 

[war&peace]

Arent such stores supposed to cater to lowest strata of society ? Closing these will hit them hard. Subsidizing corporate in hundreds of billions, but stopping subsidy of poor is not exactly a sound idea.

Operations will resume after corking the holes created for corruption. These stores are in fact hurting people as most of the money is going into the pocket of corrupt rich guy.

 

[Peaceful Civilian]

Arent such stores supposed to cater to lowest strata of society ? Closing these will hit them hard. Subsidizing corporate in hundreds of billions, but stopping subsidy of poor is not exactly a sound idea.

How it can hit poor people, 1 Rs, 2, 0.5 discount rupee won’t make difference when purchasing 50 Rs , 100 Rs

 

[Major Sam]

How it can hit poor people, 1 Rs, 2, 0.5 discount rupee won’t make difference when purchasing 50 Rs , 100 Rs

Well i have bought few times from from utility store things are quite cheap than retail shops. For poor even few rupees difference does matter.

Answer is it self in article when govt reduced subsidy, so Profit decreased also.

"However, when the government of PML-N came to power, the profit of the utility turned into a loss of Rs202.32 million in 2013-14 and subsidy also declined to Rs12.544 billion."

in PPP with 18B subsidy profit was 700m.

Current Govt is focusing on small loop holes which directly impact poor rather than targeting Big fish like PIA, PSM, DISCOs, etc which make losses in billions and here we are talking about just in few.

 

[war&peace]

Well i have bought few times from from utility store things are quite cheap than retail shops. For poor even few rupees difference does matter.

Answer is it self in article when govt reduced subsidy, so Profit decreased also.

"However, when the government of PML-N came to power, the profit of the utility turned into a loss of Rs202.32 million in 2013-14 and subsidy also declined to Rs12.544 billion."

in PPP with 18B subsidy profit was 700m.

Current Govt is focusing on small loop holes which directly impact poor rather than targeting Big fish like PIA, PSM, DISCOs, etc which make losses in billions and here we are talking about just in few.

As I said, the operation will resume after the clean up. All other loss making ventures also under scrutiny.

 

[Major Sam]

As I said, the operation will resume after the clean up. All other loss making ventures also under scrutiny.

My main concern is priorities.

here we are talking about a billion. Which directly deals with poor people.

Why not start from PIA, PSM and other entities which re eating 100s Billions yearly.

I dont have any issue with rooting corruption as it should be done across the board. But Good governance is all about setting their priorities to right track.

Now a days we have loadshedding for more than 8 hours a day in a city where bill recovery is more than 90%. I don't know where is govt. there isnt even any single state from power ministry whats the issue, when they will resolve it we all hearing about circular debt, from 1100B , 800 B itself is owned by govt. enterprises and departments.

if they kept this pace. they will screw them self very soon.

 

[war&peace]

My main concern is priorities.

here we are talking about a billion. Which directly deals with poor people.

Why not start from PIA, PSM and other entities which re eating 100s Billions yearly.

I dont have any issue with rooting corruption as it should be done across the board. But Good governance is all about setting their priorities to right track.

Now a days we have loadshedding for more than 8 hours a day in a city where bill recovery is more than 90%. I don't know where is govt. there isnt even any single state from power ministry whats the issue, when they will resolve it we all hearing about circular debt, from 1100B , 800 B itself is owned by govt. enterprises and departments.

if they kept this pace. they will screw them self very soon.

I'm sure this store issue will be resolved and it is on higher priority. A lot of corruption is being done through this store but it is easily pluggable.
The others are mega corruption cases will need more time to resolve. You need thorough investigation and services of professionals.

 

[Mentee]

Arent such stores supposed to cater to lowest strata of society ? Closing these will hit them hard. Subsidizing corporate in hundreds of billions, but stopping subsidy of poor is not exactly a sound idea.

These stores are den of corruption. I've had firs hand experience to deal with the utility staff. They create demand supply and commissions out of thin air. And the "dexterity" from a store keeper to MD corporation is too classy that you cannot even detect the damage and ill practices without being part of it. No auditors cannot do nothing - - - - - -.

 

[maithil]

My main concern is priorities.

here we are talking about a billion. Which directly deals with poor people.

Why not start from PIA, PSM and other entities which re eating 100s Billions yearly.

I dont have any issue with rooting corruption as it should be done across the board. But Good governance is all about setting their priorities to right track.

Now a days we have loadshedding for more than 8 hours a day in a city where bill recovery is more than 90%. I don't know where is govt. there isnt even any single state from power ministry whats the issue, when they will resolve it we all hearing about circular debt, from 1100B , 800 B itself is owned by govt. enterprises and departments.

if they kept this pace. they will screw them self very soon.

Exactly... priorities matter. Such steps ( without visible action against big fishes) will only make poor resent the government.

These stores are den of corruption. I've had firs hand experience to deal with the utility staff. They create demand supply and commissions out of thin air. And the "dexterity" from a store keeper to MD corporation is too classy that you cannot even detect the damage and ill practices without being part of it. No auditors cannot do nothing - - - - - -.

Leakages in PDS are present in every country . They are still tolerated because these shops serve needy.

Fighting corruption should be priority. But govt should ensure that poorest do not end up paying biggest price for this. Leakage is there in BISP as well, but doing anything against that will invite severe criticism.

 

[Mentee]

Leakages in PDS are present in every country . They are still tolerated because these shops serve needy.

Fighting corruption should be priority. But govt should ensure that poorest do not end up paying biggest price for this. Leakage is there in BISP as well, but doing anything against that will invite severe criticism.

My friend yuuve got no idea about the level of unchecked and unnoticed corrupt practices going on in the uscp.

 

[Major Sam]

My friend yuuve got no idea about the level of unchecked and unnoticed corrupt practices going on in the uscp.

Is it more than PIA, PSM, DISCOs, PR?