KARACHI - Sindh Chief Minister Syed Murad Ali Shah said on Saturday that various federal government entities working in Karachi owed the Karachi Water and Sewerage Board (KWSB) Rs18 billion, but had not paid this amount despite several notices.

He said this in response to a letter written by Federal Energy Minister Sardar Awais Ahmad Khan Leghari. He said the issue of disputed claims among different entities should be delinked from supply of additional gas to K-Electric.

Referring to Leghari’s letter, which was written to the Sindh government on April 20, Shah said Leghari had acknowledged the fact that the current power crisis faced by residents of Karachi was the result of mismanagement, inefficient system and commercial mishandling on part of the Karachi Electric (KE).

The chief minister said the minister’s letter clarified that the National Electric Power Regulatory Authority (Nepra) had clearly highlighted these issues in its report on the current electricity crisis in Karachi and the federal government was solely responsible for activities of KE because it had privatised the organisation without taking the provincial government into confidence.

The chief minister deplored the Sindh government was not even provided copy of the Implementation Agreement (IA) signed by the federal government with the private party. He said a copy obtained by the provincial government later shows details as followed:

The KESC was privatised as a vertically-integrated entity, creating a private sector monopoly in generation, transmission, distribution and billing and collection. If the public sector monopoly was bad, private sector monopoly was worst.

The responsibility for regulating the private sector monopoly (KE) lies with Nepra, a federal entity. If the report of Nepra regarding mismanagement and non-utilisation of idle capacity by K-Electric is an indictment against K-Electric, it is also a charge sheet against Nepra itself, which has utterly failed in discharging its duties as an effective regulator. The citizens of Karachi have been suffering for long, not only due to mismanagement of K-Electric but also due to bad regulation by Nepra. One such issue is plethora of complaints from consumers about overbilling by K-Electric but Nepra maintains criminal silence on such complaints.

“As far as your contention regarding outstanding dues of KWSB to K-Electric, let me make it clear that these dues are for the period where the mentioned above was in effect. As I have explained above, the Government of Sindh was not a party to the IA and the Government of Pakistan has on its own guaranteed the payments of KWSB. This matter of arrears of the period when IA was in operation is pending with the courts.

“The Government of Sindh’s view is very clear that we cannot be held responsible for the payments. I may also bring to your notice that after termination of IA, we have ensured that KWSB pays bill of K-Electric on time. Moreover, the KWSB has a claim of about Rs18 billion against various federal government entities operating in Karachi, which are not being paid despite several notices.”

The chief minister said it transpires from Awais Leghari’s letter as well as from the report of Nepra on current crises that immediate solution to the problem lies in providing additional gas to K-Electric. “I urge that the issue of disputed claims amongst different entities shall be delinked from additional gas supply to K-Electric,“ he said. He said while penal actions may be taken against K-Electric on its poor performance and terms of reference for setting the disputed claims are finalized, the additional gas supply may immediately be restored to K-Electric in the larger interest of residents of Karachi,” the chief minister said.

He urged the federal minister that residents of Karachi should not be made to suffer because of inefficiency and incompetence of utilities, regulators and the government.

Murad Ali Shah said he has already requested the prime minister to act immediately as resolution of this dispute is responsibility of the government of Pakistan. “I urge your good self to do the same as the situation is getting from bad to worse with each passing hour and further waste of time on this account will not only add to the misery of the people of Karachi but may also result in a major law and order issue,” the chief minister concluded.