The audit committee of TIP Board — after scrutinizing the accounts of TIP for last 10 years — has requested the board to refer the matter to Auditor General of Pakistan for a special audit of TIP accounts.
This was decided during 187th Board of Directors meeting of Telephone Industries of Pakistan (TIP) which was held under the chairpersonship of Minister of State for IT & Telecom Anusha Rehman here in Islamabad.
The Telephone Industries of Pakistan (TIP) board in its last meeting had directed the audit committee of TIP Board to scrutinize the accounts of TIP for last 10 years and refer the matter to Auditor General of Pakistan for a special audit of TIP accounts, if so required.
The Board had directed TIP management to resolve all their outstanding financial issues with management of PTCL and NRTC amicably and let all stakeholders pay their respective utility liabilities and had reiterated that TIP resources should only be used for its mandated purposes.
TIP Added to the list of “To be Privatized” Entities
According to sources Privatization Commission (PC) has reportedly included TIP in the list of entities approved for early sale after Defense Ministry’s refusal to take over the entity with all liabilities.
Privatization Division recently informed the Cabinet Committee on Privatization that TIP was a private limited company working under the administrative control of Ministry of Information Technology (MoIT).
The Government of Pakistan is 100 per cent owner of Telephone Industries of Pakistan with 896,193 ordinary shares of Rs 1,000 each.
PC further stated that the current challenges being faced by the company included obsolescence of machinery, plants and skill base, intense competition in the telecom sector (especially vendor market), legacy public sector culture of entire workforce, and above all heavy burden of labour salaries (Rs 500.00 to 600.00 million annually).
The Company had poor financial health with sales of only Rs 20 million in the financial year 2014-15.
It was further revealed that the CCoP, in its meeting held on October 03, 2013, approved the privatization programme which included privatization of Telephone Industries of Pakistan.
However, Telephone Industries of Pakistan was not part of the list of entities approved for early privatization. Subsequently, considering the deteriorating condition of Telephone Industries of Pakistan, MoIT approached PC to initiate its privatization at the earliest.
It was stated that the privatization of Telephone Industries of Pakistan was discussed in a meeting chaired by the Finance Minister on August 23, 2015.
During the meeting, obtaining clearance from the Ministry of Defence was urged as Telephone Industries of Pakistan is located in an area surrounded by sensitive government buildings, before initiating its privatization.
The Ministry of Defence gave its no-objection to the privatisation of Telephone Industries of Pakistan from security point of view. However, the Ministry of Defence also showed its willingness to take over Telephone Industries of Pakistan subject to the following conditions:
- Pension liability of the employees to be met by the Government;
- Payment of one year’s expenses relating to employees salaries etc for sustainability;
- Union be abolished;
- All other liabilities towards government, banks customers, shareholders and employees be cleared by the government before taking over Telephone Industries of Pakistan with no obligation.
CCoP was apprised that the terms of the Ministry of Defence were not acceptable to the Ministry of Information Technology therefore the PC may initiate the privatization of Telephone Industries of Pakistan.
The PC Board after thorough deliberations has recommended initiation of privatization of Telephone Industries of Pakistan and requested the CCoP for inclusion of Telephone Industries of Pakistan in the list of entities approved for early implementation.
After a detailed discussion, the CCoP allowed inclusion of the Telephone Industries of Pakistan in the list of entities approved for early implementation, and approved the initiation of its privatization.