Provinces refuse to adjust pending power dues under NFC

* Sindh and KP governments decline to pay billions of outstanding payables through federal adjuster * KP says PESCO is responsible for non-payment of dues

ISLAMABAD: The ruling Pakistan Muslim League-Nawaz-led federal government is facing an enormous challenge in the form of the pending power dues of billions of rupees which are payable by the provinces.
The Sindh and Khyber Pakhtunkhwa governments have declined to pay these dues through the federal adjuster. Available with Daily Times, copies of official documents suggest that the Council of Common Interests (CCI) has formed a committee to clear power dues of the provinces from their share of NFC award through a mechanism of federal adjuster. The committee has consulted all the four provincial governments regarding at-source power dues adjustment. 
However, Khyber Pakhtunkhwa and Sindh governments have so far categorically refused to clear these dues through their respective shares under the NFC award. The PTI-led provincial government of Khyber Pakhtunkhwa has said it will not accept clearance of power dues through its share in the NFC award, as the provincial government is not responsible for recovery of power dues. The provincial government has declared that the Peshawar Electric Supply Company (PESCO) is responsible for the non-payment of the dues, not the provincial government. 
PESCO has been accused of sending inflated bills to its consumers to hide its line losses, and this leads to the consumers not paying their bills. Moreover, PESCO dispatches power bills to its consumers very late, leaving few days for their payment. However, a coalition-led provincial government of Balochistan has expressed its willingness, in principle, to clear power dues from its share through the federal adjuster besides raising few concerns for the Power Ministry’s consideration, said the official documents. 
Similarly, the government of Punjab, in its response submitted to the Ministry of Inter-provincial Coordination, has neither opposed nor favoured the idea of adjustment of power dues through the federal adjuster. Punjab has also told the Inter-provincial Coordination Ministry that the matter is going through the necessary process in the provincial energy department. Official sources in the Water and Power Ministry, on the condition of anonymity, told this scribe that around Rs 160 billion power dues are owed by the provinces, noting that electricity worth more than Rs 80 billion is being sold to the provinces on a monthly basis. 
They further said that the Finance Ministry was interested in deducting power dues after every two months from their shares, as it wanted to permanently arrest the circular debt. The Council of Common Interests’ (CCI) likely meeting tomorrow (Thursday) may take a final decision in this regard, they added. The sources further said that differences between central, Sindh and Khyber Pakhtunkhwa governments remains unresolved. Not a single penny on account of power dues has so far been deducted at source through the already re-activated institution of federal adjuster.
They also said that widening gap between the power generation cost and recoveries from consumers was also contributing to the debt, besides heavy power losses of DISCOs are ranging around 30 to 40 percent against the approved 16 percent. One of the reasons for low recoveries is the skyrocketing power tariff, they added. “The PML-N government is in a fix how to resolve the matter of pending heavy power dues owed by the provinces,” a senor official at the Power Ministry, who declined to be named, said. He added that the federal government’s attempt to decrease load shedding by clearing the circular debt has so far not borne fruit, as the country is facing 12-14 hours of power cuts. Even a committee, headed by the federal power minister, has so far failed to convince Sindh and KP governments to resolve the matter of outstanding power dues for good.
The PML-N government had cleared the Rs 480 billion circular debt after coming into power, and claimed that the power sector debt would never rise again. And, to stop re-emergence of the circular debt, the government budgeted Rs 220 billion subsidy for the current fiscal year besides re-activating the institution of federal adjuster in consultation with provinces. 

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