Minister for Industries and Production Hammad Azhar said on Saturday that the government has decided to lay-off 95 percent of the Pakistan Steel Mills’ (PSM) employees.
In a media briefing at Press Information Department (PID), the Minister for Industries said that the total workforce of Pakistan Steel Mills is 9,500 out of which 4,500 employees will be laid-off in the first phase. He said only 5 percent of the total staff will be retained.
In June the federal government had approved a retrenchment policy for all 9,350 remaining employees of the PSM, who would be offered a one-time severance cost of about Rs. 20 billion
The minister said in the past bail-out packages worth of Rs. 92 billion were given to Pakistan Steel Mills but it couldn’t be revived back to financial viability. Hammad Azhar said right now the government is paying Rs. 350 million per month in salaries and Rs. 20 billion in pensions to its employees. He said the total liabilities on Pakistan Steels reached had Rs. 230 billion at one point, and it is incurring loses of Rs. 15 billion to Rs. 20 billion per annum.
He added that during Pakistan People’s Party’s (PPP) government PSM incurred loses of over Rs 100 billion. Criticising the PPP, he said if the Sindh government wants to bid for PSM at this point in time, the federal government would welcome it.
The minister said that the government want to run Pakistan Steel Mills as a joint venture with a new investor. He said that those who are responsible for the closure of Pakistan Steel Mills are now doing politics on it’s failure. He said even those who once made the offer that the buyer of sate-run Pakistan International Airlines (PIA) will get Pakistan Steel Mills for free are now the ones criticising the government.
Following the announcement, PPP Chairman Bilawal Bhutto-Zardari tweeted his condemnation of the decision, calling it “heartless and vowing to “return each and everyone back to work”.
In response, the Minister for Industries and Production tweeted that “it was during the PPP tenure that the PSM went from a profit-making entity with billions in [its] bank account to a heavy loss-making and bankrupt entity”.