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PSM hints at widespread social unrest




  • Pakistan Steel Mills (PSM) Executive Committee of the Management (ECM) has requested the federal government to rescue the mills from total shutdown and arrange Rs 106 billion to clear pending salaries from 15 October onwards and other liabilities, official sources told Business Recorder. 

    National Assembly Standing Committee on Industries and Production (MoI&P) on Monday also expressed its deep concern over the present state of PSM which has been allowed to collapse with its employees not being paid salaries for the last three months. The committee strongly recommended that the Ministry should immediately ensure the release of salaries to the poor and low paid employees of the Steel Mills. “If the government is facing financial constraints, salaries of Prime Minister, Ministers and Parliamentarians should be stopped instead of those of poor employees,” said Asad Umar. According to him, those who plundered and destroyed PSM are sitting abroad while the poor employees are being punished. 

    Official sources told this Business Recorder that the issue of non-payment of nearly three months salaries of PSM employees and non-availability of coking coal due to shortage of finances was deliberated in the meeting of the Executive Committee of the Management (ECM) on 8th January, 2014. 

    The sources said ECM analysed the last four months” cash receipts/expenditures to determine the possibility of payment of overdue salaries of employees. It was observed that as per the last ECC approval dated 7th Sep 2013, Rs 2.9 billion was released by Ministry of Finance (MoF) against payment of pending salaries and for meeting critical expenditure up to November 2013. ECM maintained that it was only a short term financial arrangement till November 2013. PSM has somehow managed to continue business activities to date without getting any further financial support from the GoP. 

    ECM observed with great concern that due to non-availability of any further financial assistance by GoP, the situation has gone from bad to worse and if immediate remedial measures are not taken, the production line will come to a halt. On the other hand, payment of nearly three months” salaries to the employees as well as payment of terminal dues of retired employees has been pending and financial/legitimate liabilities have now piled up to Rs 106.4 billions up to 30 Sep 2013. 

    The ECM approved the following resolution: “Pakistan Steel Mills is in extraordinary serious financial crisis. There are no funds available for payment of salary, opening of L/C for import of raw materials (coal and iron ore) and if immediate measure/funding arrangements are not initiated the operation of the mill will come to complete halt. Different segments of workers/officers are in a state of desperation due to non-payment of salaries since October 2013. ECM apprehends that this state of affairs may culminate in a serious law and order situation and disturb the industrial peace and harmony of the mill, which may not be controllable by PSM Management alone. GoP is requested to rescue PSM and urgently approve recommendations given by the Board of Directors and MOI&P to run the future affairs of Pakistan Steel.” PSM”s future will be discussed in the forthcoming meeting of the ECC scheduled to be held on January 16, 2014 under the chairmanship of Finance Minister Ishaq Dar. 

    Copyright Business Recorder, 2014

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