Govt Announces Policy for Privatisation of Commercial Govt Enterprises
In a significant step towards fulfilling the International Monetary Fund’s (IMF) criteria and advancing economic reforms, Pakistan’s caretaker federal government has issued the Ownership and Management Policy of Government Institutions for the year 2023.
This comprehensive policy outlines a roadmap for restructuring, enhancing governance, and boosting the performance of government-owned enterprises (GOEs).
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Strategic Balancing: Preserving Control and Embracing Privatization
The newly issued policy strikes a delicate balance between maintaining government control over sensitive entities of national security or strategic importance and gradually privatizing commercial GOEs.
This approach aims to optimize resource allocation, foster a more competitive business environment, and attract private-sector investment.
Restructuring for Efficiency and Performance-Based Retention
The policy mandates the restructuring of certain institutions, with forthcoming decisions shaping their future direction and operational efficiency. It also introduces a performance-based approach to recruitment and job retention within GOEs.
Key roles, such as chief financial officers, CEOs, secretaries, and senior management, will be subject to strict selection criteria, with performance evaluations determining their continued employment.
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This performance-driven approach is expected to instill a culture of accountability and excellence within GOEs.
Robust Internal Audit and Monitoring Mechanisms for Effective Implementation
To ensure effective implementation of the policy, the government will establish a dedicated cabinet committee for GOEs.
This committee will oversee the policy’s execution, address emerging challenges, and provide guidance to relevant ministries and institutions.
Additionally, a central monitoring unit will be tasked with overseeing institutional performance, analyzing business plans, and providing recommendations.
The policy also emphasizes the recruitment of competent and experienced personnel for this monitoring unit, ensuring that the unit is equipped with the expertise necessary to effectively oversee GOE performance.
Database of Independent Boards and Periodic Policy Reviews for Continuous Improvement
The Ministry of Finance plans to compile a database of independent boards of directors for GOEs to enhance governance and oversight.
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These independent boards will be composed of experienced professionals with diverse expertise, ensuring that GOEs are guided by sound leadership and strategic direction.
Recognizing the need for adaptability in the face of evolving economic conditions and market dynamics, the policy on government-owned institutions will undergo a review every five years.
This periodic review process will ensure that the policy remains relevant, effective, and aligned with Pakistan’s economic goals and objectives.
Commitment to Economic Stabilization and Growth through GOE Reform
The implementation of this comprehensive policy underscores the caretaker government’s unwavering commitment to bringing structural reforms and enhancing accountability and efficiency within GOEs.
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This strategic move aligns with the IMF’s guidelines and aims to promote economic stabilization and growth in Pakistan.
By optimizing resource allocation, fostering a competitive business environment, and enhancing the performance of GOEs, the government is laying the foundation for a more resilient and prosperous Pakistan.
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