Daily Times

In a democracy this talk is dangerous. The government has been privatised. Its shares have been given to the Sharif group of industries. Parliament is just a political hangout. Senate is just a rubber stamp. These are some of the loud headlines in media that make breaking news. The government says this is a conspiracy by the opposition that is jealous of its development work. Analysts say there is truth in this. The opposition says it is a fact of governance in the country. Why has this controversy on the style of governance reached a level where the credibility of the claims of the government has become a matter of ridicule? Is it because of the selective use of parliament to suit its own requirement? Is it because of weak legislation that has made these upper and lower houses of government become a liability instead of an asset to governance? The question on governance is not new but what is new is that in recent times statements on the quality of governance by the army and the Chief Justice (CJ) himself have added fuel to the fire. Oblivious to this the government keeps on ignoring parliament and keeps on imposing taxes on the public. Dismissive of this the government makes plans of privatising public sector entities with ordinances issued without consultation or debate on any forum of public representation.

The state of governance in state owned enterprises has been pathetic. An estimated Rs 500 billion is leaking annually due to corruption and mismanagement in them. Unfortunately, whichever organisation starts with Pakistan in its name has an image of politicisation, zero merit and massive losses. This image has been built on years of horrendous performance be it PTV, PIA or PSM. These organisations have been subsidised heavily to survive and are a burden on the economy. The solution suggested by the government is: let us privatise them. Is privatisation the cure to all these problems? Is privatisation an admission of failure of governance by the government? Is privatisation a confession that public sector enterprises cannot be managed efficiently and honestly? Is privatisation a cure for all ills to the revenue shortfall due to tax, budget and trade deficit? Previous experience shows that without answering these questions privatisation turned out to be a loot sale of assets that were sold at throw away prices to people with clout in the ruling government.

Every analysis of these state enterprises has shown what needs to be done to turn around their performance. The PML-N government also promised that competent people from professional backgrounds would be hired on strict criteria to make the energy sector, the airline and the steel mill sustainable. Advertisements were also placed in the newspaper but neither the best were hired nor the criteria of merit adhered to. This was done to accommodate their own interpretation of what merit was i.e. friends and relatives of those in power. Take PIA’s case: President Zardari appointed his close friend Captain Ejaz as the head, which resulted in a huge protest by the PML-N and other opposition parties. However, as soon as the Noon government took control in 2013 it appointed a highly controversial man, Shujaat Azeem, as advisor on aviation to manage the Civil Aviation Authority (CAA). He fitted on merit as defined by the party i.e. he was the brother of PML-N big wig Tariq Azeem and had impressed the Prime Minister (PM) with his loyalty to the family. In 2013, the Supreme Court (SC) had expressed concern over the appointment of Shujaat Azeem as adviser to the PM in the CAA, as he had been court-martialed by the Pakistan Air Force. In view of these concerns, he tendered his resignation. However, he was again appointed as special assistant. In recent times, the case has resurfaced again. The SC last month took strong exception of appointing Shujaat Azeem, a convicted person, as the special assistant to the PM on the CAA, the position equivalent to that of the status of a state minister and the case is still sub judice.

How can those very people who fail to manage public sector organisations manage their own similar businesses with efficiency? Is there no conflict of interest when people who are running competitive businesses are also policymakers? The minister of petroleum and gas is running a competitive airline, Airblue. Even Shujaat Azeem, apart from being the brother of Tariq Azeem, is the co-owner of Royal Airport Services at Islamabad, Lahore, Karachi and Peshawar airports. It handles terminal services, cargo/ramp and airport traffic control. Among his clients are Saudi Airline, Etihad Air, Gulf Air and Qatar Air. While their own businesses do well, PIA’s losses accumulate to almost Rs 300 billion as flights are late, services are poor and costs are high. So how would privatisation change this constant decline? The answer given is that it will bring revenue through shareholders investment. But the money was coming in any case from the government. Then what went wrong? It is the professional management that is missing. It is honest and merit based leadership that is missing. That itself means governance failure.

The severity of losses in these public sector organisations makes them case studies for sell off. The government has promised to sell off almost 60 organisations and IMF loan extension is dependent on it. But the problem is that the IMF will never care about the socio-cultural issues or national security requirements. Another problem is the sale price. When any asset becomes saddled with debt, losses, bad machinery and poor HR, it will be sold at junk value. That is why even when logic is given on how privatised banks have become more efficient, the counter question is that if they had been turned around and then sold off they would have fetched multiple increases in value. Thus, these continuous allegations on deliberate attempts to devalue them to buy them at cheap prices and then make phenomenal profits is given some substance by the National Accountability Bureau’s (NAB’s) cases on many such dubious sales.

The difference between private sector and public sector organisations is the shareholders’ ability to hold management accountable. In the private sector the shareholder directly makes every penny count while in the public sector the actual shareholder is public and the government is the custodian of their money. With the government entrenched in unaccountable nepotism and cronyism public money becomes a loot sale. Some say it is in the DNA of the public sector to be inefficient, but in reality it is in the DNA of the people in the government who lead the public sector that defames and devalues them to become disposable liabilities instead of assets.

The writer is director communications of the PTI in Punjab, an analyst and a columnist. She can be reached at andleeb.abbas1@gmail.com