The Caretaker Federal Cabinet has taken a decisive step toward the privatization of government institutions, including the national carrier, PIA, aiming to eliminate hurdles in the process.
Reports suggest that an ordinance is set to be issued, ensuring a smoother path for privatization initiatives.
Key discussions within the Cabinet have resulted in the approval to establish an appellate tribunal, dedicated to handling petitions concerning privatization. This tribunal's decisions will hold precedence, subject only to review by the Supreme Court.
Sources indicate that the privatization process has been significantly hindered by legal challenges across various courts, prompting the need for this appellate tribunal. The move has been prompted by demands from both domestic and international investors eager to participate in Pakistan's privatization endeavors.
Furthermore, to expedite the privatization process and streamline legal proceedings, there are plans to transfer pending cases from High Courts and other judicial bodies to this newly proposed Appellate Tribunal.
On November 30, the caretaker federal government in Pakistan took an important step towards fulfilling the criteria set by the International Monetary Fund (IMF) by issuing the Ownership and Management Policy of Government Institutions for the year 2023.
The newly issued policy will have a comprehensive impact across all government-owned enterprises, with a focus on ensuring that sensitive entities of national security or strategic importance remain under government control. However, the policy also outlines plans for the gradual privatization of commercial government enterprises.
As per the Ministry of Finance’s document, certain institutions will undergo restructuring, with forthcoming decisions shaping their future. Moreover, the policy dictates a shift towards future recruitments in government institutions, which will primarily occur on a contractual basis.
Strict selection criteria will be implemented for key roles such as chief financial officers, CEOs, secretaries, and senior management, and job retention or dismissal will be based on performance evaluations. The policy also stipulates a one-month notice period before dismissal due to unsatisfactory performance.
Within six months of the policy’s implementation, categories for government-owned enterprises will be established. Additionally, all such enterprises will be required to develop robust internal audit procedures. To enforce the new policy effectively, a cabinet committee dedicated to government-owned enterprises will be established.
Furthermore, the policy outlines the creation of a central monitoring unit tasked with overseeing institutional performance. This proposed unit will analyze the business plans of government institutions and provide recommendations. The plan also includes the recruitment of competent and experienced personnel for this monitoring unit.