PR, PSM, PIA being restructured to curb financial losses: Dr Ishrat
APP32-201120 ISLAMABAD: November 20 - Federal Minister for Information and Broadcasting Senator Shibli Faraz and Advisor for Institutional Reforms and Austerity Dr. Ishrat Hussain jointly addressing a press conference at PID Media Center. APP photo by Saleem Rana

ISLAMABAD, Nov 20 (APP): Advisor to the Prime Minister on Institutional Reforms Dr Ishrat Hussain Friday said Pakistan Railways (PR), Pakistan Steel Mills (PSM) and Pakistan International Airlines (PIA) were being restructured to curb financial losses.

Speaking at a press conference along with Minister for Information and Broadcasting Senator Shibli Faraz, he said the cabinet had approved the restructuring plan of the PR while the PSM employees would be given a handsome severance package worth billions of rupees besides restructuring the institution.

He said five companies would be set up to make the Railways self-sufficient and profitable department. One company would be set up for the new Main Line – One while other companies would deal with freight and passenger services.

He said till 1985, Railways was a profitable organization and earned substantially from its freight service but now 96 percent freight was taken by trucks and four percent by the Railways.

He said under an arrangement, 1,200 acres of PSL land would be given under a leasing arrangement to put the industrial unit back on its feet. About 19,000 acres of land would be kept separate and be held by the government, he added.

He said the PIA was suffering losses of Rs450 billion and had huge debt.

Under a financial restructuring plan, the national flag carrier employees would be reduced from 14,000 to 7000, he said adding 3,500 of its employees would be offered a voluntary severance package while 3,500 would be reduced by outsourcing core business of the PIA.

The per plane employee would be reduced from 500 to 250 and flights would be made operational for profitable routes, he told.

The former governor of State Bank of Pakistan said the government would do away with redundant regulations and no objection certificates to facilitate opening of new businesses.
The difference in prices of sugar in the market and utility stores was causing distortion in the prices. The flour was available at lower prices in the Sahulat bazaars, he added.

Due to incentives of the government, the construction industry would invest Rs1 trillion and business would be generated in more than 30 industries, he informed.

Industrial activities in Faisalabad were booming and there was shortage of labour, he noted.

Dr Ishrat said it was easy to break down institutions but it always took time to build a new one. He said during the tenure of present government, the heads of different institutions and departments were appointed on merit and through a set selection procedure.

The collective judgment was made and the appointments were discussed in the cabinet before the approval, he added.

Talking about reforms in Federal Board of Revenue (FBR), he said if FBR started collecting tax from all taxpayers, the country’s dependence on borrowing would end.

Human interaction between tax collectors and payers should end to increase the tax revenue, he added. He said automation of tax system including automated refund transfer to exporters was being done.

Dr Ishrat told that Rs250 billion were refunded to the exporters, adding out of 3.7 million tax payers only one million were paying income tax and the burden was on honest taxpayers.

The FBR was tracing those who were paying income tax by taking help of databases of National Database and Registration Authority, property registration departments and civil aviation records.

He was of the view that 17 percent sales tax was high and could be brought down when the citizens would start paying their income tax.

Thousands of companies were registered but many of them were not paying taxes, he added.