ISLAMABAD: After more than two years in office, the federal cabinet will launch the process of naming regular/full-time chief executive officers (CEOs) of power distribution companies (Discos) on Tuesday and approve the appointment of two gas utilities’ managing directors.
This comes on the heels of Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Corporation Limited (SSGCL) about Rs2.3 trillion circular debt in the power sector as of Sept 30, 2020, and about Rs350bn circular debt in gas utilities, up from Rs1.2tr and about Rs120bn in 2018, respectively.
On Tuesday, the federal cabinet will meet. Prime Minister Imran Khan will chair the meeting with seven agenda items pertaining to the filling of senior roles of state-owned corporations, chief executives, managing directors and boards of directors (SOEs).
In addition, the cabinet will study the use of the Covid Relief Fund of PM, Ehsaas Kafalat Payments and the National Socio-Economic Survey of Ehsaas, the services given to the provinces by the federal government and the resources produced by the provinces themselves.
Review of utilisation of PM’s Covid relief fund also on agenda of meeting
The cabinet will propose naming the CEO of Ignite, an information technology ministry firm, members of the board of directors of the Public-Private Partnership Authority (PPPA), the board of trustees of the Old-age Benefits Organization of Workers and Community Health Attaches in overseas missions in Pakistan.
Sources suggested that the cabinet is likely to accept the naming of Amir Tufail and Javed Hamdani as SNGPL and SSGCL managing directors/CEOs, respectively. They said that Mr Tufail and Mr Hamdani were given preference by the selection committee as the first and second choices for the SNGPL. Likewise, for SSGCL, Mr. Hamdani and Amin Rajpoot are in the first and second roles. Logically, if anything political comes up during the conference, Mr Tufail and Mr Hamdani will be chosen as MDs in the top positions of the panel for SNGPL and SSGCL, respectively.
An announcement for the positions of CEOs of Discos is also required to clear the cabinet. Nearly all of Discos’ new CEOs are operating on the Pakistan Electric Power Company (Pepco) stop-gap contracts, a discontinued body that has undergone periods of elimination and rebirth over the past decade and is managed by the power division officers on an additional charge basis. This has essentially reduced the organisational control of Discos’ board of directors and CEOs and undermined their efficiency.
A few days earlier, the Chairman of the Cabinet Committee on Energy and Planning, Minister Asad Umar, declared the abolition of a power centre in the Pakistan Secretariat for the management of power companies. Under the corporate rules of the Securities and Exchange Commission of Pakistan (SECP) for SOEs, the appointment of CEOs of Discos is required by their respective boards of directors through a competitive procedure.
The sources said that in the last week of October, the federal cabinet had directed that all current vacancies of CEOs or MDs or heads of separate SOEs should be filled within three months. Otherwise, ministers and secretaries of departments and branches would be kept accountable or reported in advance of a week as to whether these vacancies could not be filled within three months.
Any of the ministries were seeking to postpone the deadline, but the Prime Minister’s Office refused the change. In the case of the Islamabad Electric Supply Company, several prominent figures have allegedly proposed awarding retirement extensions to the new CEO.
The SECP rules have set out conditions for the selection of SOE CEOs, including early retirement status or dismissal from the current rank of government officers or armed forces for appointment as CEOs. A selection committee chaired by the minister in charge shall, with the consent of the cabinet, set the assessment requirements in accordance with the relevant and appropriate SOE guidelines.
Within these requirements, the financial honesty of the applicants must be determined by way of financial accounts, tax reports and asset statements, etc., which should be reported in addition to the documentation of the credit information bureau on fees owed to financial institutions, etc.
He/she will have to seek early retirement or resign from his post if an officer serving in the state or armed forces were chosen for the role of chief executive.
A selection committee established for the purpose of shortlisting and recommending appropriate candidates shall be established for the appointment of the chief executive of a public sector corporation upon nomination by the federal government. The boards will lead the selection process and send a panel for approval by the prime minister to the ministry concerned.
Under these regulations, the ministry concerned is required to put public advertisements in leading newspapers, at least three months before the expiry of the term of office of the current Chief Executive Officer, and to post advertising on the related websites of the government and the respective public sector business. Over the past few years, this fundamental provision has largely remained unimplemented and most roles are carried out on an ad hoc basis.