ISLAMABAD: The government has closed down 1,925 loss-making Utility Stores across Pakistan, resulting in the termination of 4,060 employees. This move is part of a major restructuring plan for the Utility Stores Corporation (USC) aimed at cutting costs and preparing the organization for privatization.
During a briefing to the Senate Standing Committee on Industries and Production, chaired by Senator Aon Abbas, USC Managing Director Faisal Nisar Chaudhry revealed that closing these Utility Stores has saved the government Rs1.7 billion. He explained that if the USC is not privatized soon, it will require Rs7 billion annually just to pay salaries.
Currently, there are 3,742 Utility Stores in the country, but only 1,500 will remain operational after the privatization process. The monthly financial loss of the USC has already been reduced to Rs220 million due to these closures.
The privatization process has temporarily been put on hold because the corporation’s financial audit for the past two years has not been completed. The MD stated that the audit is expected to be finalized by August 2025, after which privatization will move forward.
Under the rightsizing plan approved by the USC Board of Directors in December 2024, around 5,000 permanent employees will be sent to the surplus pool. In addition, 2,554 employees working on contracts or daily wages will be laid off. A golden handshake scheme is also being considered for 25% of the remaining staff to reduce the financial burden, which currently stands at Rs2.7 billion annually in salaries.
The USC has requested Rs7 billion in the upcoming budget to continue operations until the restructuring is complete. The committee was informed that due to budget constraints, even Ramadan relief packages will now be distributed through the Benazir Income Support Programme (BISP) instead of Utility Stores.
The chairman has asked for more details about employees hired in 2007 and 2013 from each province and recommended that representatives from the Board of Directors, CBA Union, and Privatization Commission be invited to the next meeting for further discussions.