Karachi, April 21, 2018 (PPI-OT): Sindh Chief Minister Syed Murad Ali Shah in a reply to the letter of federal energy minister Awais Leghari says the KW and SB has a claim of about Rs. 18 billion against various federal government entities operating in Karachi, which are not being paid despite several notices, therefore issue of disputed claims amongst different entities shall be delinked from the additional gas supply to K-Electric.
Sindh Chief Minister Syed Murad Ali Shah referring Awais Leghari’s letter of 20th April, 2018 in which he [Mr Leghari] has acknowledged the fact that the current crisis of power outages being faced by the residents of Karachi is the result of mismanagement, system inefficiencies and commercial mishandling by Karachi Electric (KE).
“You have also mentioned that NEPRA has clearly highlighted these issues in its report on current electricity crisis in Karachi,” Murad Shah says and adds “Let me state that Government of Pakistan (GOP) has to take the responsibility for the failures of KE as GOP privatized the entity without any consultation with the then Sindh government (GOS) and entered into the contractual arrangements with the private party, while keeping GOS completely out of the process.”
The chief minister deplores the Sindh government was not even provided the copy of the Implementation Agreement (IA) signed by GOP with the private party. Murad Ali Shah says, the copy of IA, which was subsequently obtained by Sindh government after hectic efforts, shows as s follows:
a. The erstwhile KESC was privatized as a vertically integrated entity creating a private sector monopoly in generation, transmission, distribution and billing and collection. If the public sector monopoly was bad, private sector monopoly is worse.
b. The responsibility of regulating the private sector monopoly (KE lies with NEPRA, a federal entity. If the report of NEPRA regarding mismanagement and non-utilization of idle capacity by K-Electric is an indictment against K-Electric, it is also a charge sheet against NEPRA itself, which has utterly failed in discharging its duties as an effective regulator. The citizens of Karachi have been suffering since long, not only on account of the mismanagement of K-Electric but also due to bad regulation by NEPRA. One such issue is the plethora of complaints from consumers about over billing by K-Electric but NEPRA maintains criminal silence on such complaints.
c. As far your contention regarding outstanding dues of KW and SB to K-Electric, let me make it clear that these dues are for the period where the IA mentioned above was in effect. As I have explained above, Government of Sindh was not a party to the IA and Government of Pakistan has on its own guaranteed the payments of KW and SB. This matter of arrears of the period when IA was in operation is pending with the courts. The Government of Sindh’s view is very clear that we cannot be held responsibility for the payments. I may also bring to your notice that after the termination of IA, we have ensured that KWSB pays bill of K-Electric on time. Moreover, the KW and SB has a claim of about Rs. 18 billion against various GOP entities operating in Karachi, which are not being paid despite several notices.”
The chief minister says it transpires from Mr Awais Leghari’s letter as well as from the report of NEPRA on current crises that the immediate resolution to the problem lies in providing additional gas to K-Electric. “I urge, that issue of disputed claims amongst different entities shall be delinked from the additional gas supply to K-Electric, “he says and adds “while, penal actions may be taken against K-Electric on its non-performance and TORs for setting the disputed claims are finalized, the additional Gas supply may immediately be restored to K-Electric in the larger interest of residents of Karachi.” He urges the federal minister that the residents of Karachi should not be made to suffer because of inefficiency and incompetence of the utility companies, regulators and the Government.
Murad Ali Shah says, he has already requested the Prime Minister of Pakistan to act immediately as the resolution of this dispute is the responsibility of the GOP. “I urge your good self to do the same as the situation is getting from bad to worse with each passing hour and further waste of time on this account will not only add to the misery of the people of Karachi but may also result in a major law and order issue,” the chief minister concludes.
For more information, contact:
Press Secretary,
Chief Minister House, Sindh
Tel: +92-21-99202019(Ext: 336)
Website: www.cmsindh.gov.pk