IMF approves exempting consumers using up to 200 units from late surcharge

Inflated bills in August had resulted in countrywide protests

ISLAMABAD (Dunya News) – The International Monetary Fund (IMF) has approved provision of relief to the electricity consumers, as Pakistan saw countrywide protests over inflated bills thanks to the persistent tariff hikes.

The news was shared by the finance ministry which said on Thursday that Caretaker Prime Minister Anwaarul Haq Kakar would get the cabinet approval of the plan through summary circulation.

However, the relief, which is temporary in its nature, would be limited to the consumers using up to 200 units of electricity as the households falling in the category of 201 to 400 units are omitted by the world’s top lender.

Read more: Increasing energy prices, interest rates, tax collection remains IMF's focus

According to the finance ministry’s documents, those consuming up to 200 units are exempted from late surcharge [fine] if haven’t paid the monthly bills for August on time while they are also allowed to pay the amount in instalments.

Meanwhile, the move is going to benefit around four million consumers, while the numbers would have jumped to 32 million in case those consuming up to 400 units of electricity had remained part of the relief plan.

On Wednesday, top government officials had announced a countrywide crackdown against smugglers and power thieves in attempt to reduce the losses suffered by national exchequer and control the rising prices of different commodities.

Read more: Govt goes for countrywide crackdown against smuggling, power theft

In this connection, Muhammad Ali and Murtaza Solangi – two members of the caretaker cabinet – announced the planned crackdown against electricity theft as the huge line losses, rising cost of imported fuel for power generation and the capacity charges have inflated the monthly bills to a record level.

While revealing that the annual loss due to electricity theft and failure to pay bills currently stands at Rs589 billion, Ali said power theft meant that others were forced to pay higher bills and admitted that the power tariff couldn’t be reduced unless the practice was stopped.

Separately, the Ministry of Finance said that massive hike in fuel prices and power tariff in August would increase inflation in the coming months, in yet another indirect admission of the policy failures guided by the IMF, which have made the lives of an overwhelming majority miserable in Pakistan.

Read more: Fuel, electricity price hikes to boost inflation: Ministry of Finance

As the IMF conditions related to raising fuel and energy prices as well as higher interest rates have fuelled inflation and stifled the economy, Pakistan has been witnessed a drastic decrease in electricity [just like petrol and diesel] consumption - a clear indication of the policy failure on the part of world's top lender.

Read more: Negative impacts of IMF conditions force govt for smaller power tariff hike