In a major policy shift, the federal government of Pakistan is set to close all operations of the Utility Stores Corporation (USC) by July 31, 2025, as part of a broader push for privatisation and fiscal reforms, according to a statement released on Wednesday.
The decision emerged during a high-level meeting of the Prime Minister’s Committee on USC closure, chaired by Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, at the Finance Division.
Key Objectives and Timeline
The committee was assigned three core mandates:
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Ensure a transparent and smooth closure process.
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Develop a Voluntary Separation Scheme (VSS) for USC employees.
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Recommend a structured roadmap for privatisation of USC’s operations and assets.
The meeting confirmed that, in line with government directives, all retail operations of USC will officially cease by July 31, 2025.
Employee Compensation Through VSS
A major point of discussion was the formulation of a financially viable and legally sound VSS. Committee members analyzed the:
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Fiscal implications
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Size and structure
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Legal and operational impact of the scheme
To streamline the process, a subcommittee led by the Secretary of the Establishment Division was formed. This subcommittee includes members from:
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Finance Division
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Industries & Production Division
Their report on the contours and feasibility of the proposed VSS will be submitted by week’s end, enabling the main committee to finalize its recommendations for submission to the Prime Minister.
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Privatisation Prospects and Asset Sales
The committee also advised consulting the Privatisation Commission to evaluate:
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Optimal privatisation strategies
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Asset sale options
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USC’s long-term financial disengagement from the public sector
This consultation will play a crucial role in structuring the privatisation process and minimizing fiscal risk to the government.
What Is USC?
The Utility Stores Corporation, established in 1971, operates Pakistan’s largest government-owned retail chain, providing subsidized essential goods. Its closure marks the end of a decades-long effort to offer controlled-price commodities to low-income households.
The decision underscores the government’s commitment to downsizing loss-making entities, promoting market efficiency, and easing the burden on the national exchequer.
