Mass closure of utility stores begins soon

The government has decided to shut down an additional 1000 utility stores this month. This decision was disclosed during a meeting of the National Assembly’s Standing Committee on Privatization, chaired by Farooq Sattar

The Utility Stores Corporation (USC) has confirmed that more than 2237 employees have been laid off so far as part of a major restructuring plan. Officials informed a parliamentary committee that the focus is now on closing down financially weak outlets, with around 1000 stores expected to be shut across the country.

The USC said only profitable stores will be considered for privatization. The move aims to reduce financial stress, especially as the government’s Rs60 billion subsidy for the current fiscal year has not yet been released. Last year, Rs38 billion in subsidies were allocated for utility stores.

Officials from the Ministry of Industries and Production also highlighted that USC has submitted a Rs2.6 billion claim, which is still under discussion. While the USC said they have already filed an appeal, the Federal Board of Revenue (FBR) clarified that they have not challenged the decision so far.

The FBR chairman cautioned that offering special exemptions to USC could create legal complications since revenue collections are shared with the provinces. He emphasized that any relief requests must be handled through the Alternative Dispute Resolution Committee (ADRC), not directly by the FBR.

Additionally, the government’s privatization adviser revealed that over the last ten years, 23 public sector companies have suffered combined losses of Rs5.5 trillion. The committee chairperson suggested that, if legally possible, relief should be provided to USC. However, the final decision now rests with the finance ministry and the ADRC.This development signals a major shift in how utility stores operate, with efficiency and financial viability now the key focus.