The federal government is preparing a Rs. 27 billion financial package to address the deepening crisis at the Utility Stores Corporation (USC), a once-vital retail network now crippled by debt and stalled operations.
The plan, set to be presented to the Economic Coordination Committee (ECC) for approval, comes as lawmakers raise alarm over unpaid salaries, outstanding vendor dues, and the near-total shutdown of USC branches nationwide.
Majority of Employees to Be Laid Off
According to the Ministry of Industries and Production, a massive Voluntary Separation Scheme (VSS) will consume Rs. 15–18 billion of the package, effectively winding down most of USC’s workforce. Out of an estimated 10,000–11,000 employees, only 300 staff members will be retained temporarily to oversee the privatization process, officials confirmed.
The ministry assured that separation payouts would be “attractive,” though the details are yet to be finalized. The National Assembly’s Standing Committee on Privatization has demanded a full breakdown of the compensation plan in its next session.
Vendor Dues and Debt Pile-Up
Another Rs. 13.8 billion will go toward clearing unpaid bills owed to suppliers, including hefty sums owed to the Trading Corporation of Pakistan and the Federal Board of Revenue (FBR). USC’s total debt has ballooned to Rs. 54 billion, reflecting years of losses and declining government support.
Subsidies to the utility chain were cut off in August 2024, while all store operations were halted in July 2025, effectively shuttering what was once the country’s largest state-run retail network.
Privatization Now the Only Way Forward
The USC’s collapse highlights ongoing challenges in Pakistan’s state-owned enterprises sector, where inefficiency and mounting losses often leave the government with few options beyond privatization. Officials say the downsizing and vendor settlements are intended to make the corporation more attractive to potential buyers.
The committee’s push for transparency suggests more scrutiny ahead, especially as thousands of employees await payouts after months without pay.
