Pakistan presents a strange and disturbing phenomenon in the management of its State-Owned Enterprises (SOEs) and government corporations. At a time when the country is struggling with debt, seeking repeated loans, imposing taxes on ordinary citizens and cutting development expenditure, some senior executives of government-owned organizations continue to enjoy salaries and perks that would be difficult to justify even in a financially prosperous country. Reports of executive compensation running into millions of rupees every month raise a fundamental question: Can a financially distressed Pakistan afford such a system? Take the reported remuneration of the President of a major government-owned bank, running into 9 millions of rupees a month. What is the justification for such extraordinary compensation when the organization belongs to the people of Pakistan? Similarly, in organizations such as OGDC, SSGC, PPL, PCAA, PAA, Governor SBP, and ADBL. Engineers and technical staff are working in difficult conditions at exploration and production sites, taking operational risks and actually producing oil and gas. Yet the chief executive, sitting in an office or attending meetings, can receive a package many times greater than those who perform the core operational work likewise other CEO’s sitting in cozy offices shuttling the files are paid huge amount. Over and above they have the bonuses running in millions. Likewise, salaries of speaker’s national assembly, Senate and parliamentarians is out of proportion without contributing anything towards welfare of people. This is not an argument against paying competent professionals properly.
The issue is proportion, accountability and public interest. SOEs, corporations and authorities have created their own kingdoms. Besides bringing deputations on very fat salaries without any justification. One of the fundamental defects is that many SOEs have developed their own pay structures, service rules, allowances and perks, often operating almost like independent kingdoms. Positions are created, salaries are determined and facilities are sanctioned without any fear and accountability. Pakistan Civil Aviation Authority is a classic example of extravagance where new rules were framed demolishing the old structure and rules only to rob the authority. Karachi’s Jinnah International Airport currently hosts 20 to 27 active commercial airlines, which is lower than the historical peak when upwards of 35 international and domestic carriers served the hub during its golden era in the 1970s and 1980s when PCAA was one entity with one Deputy DG and few GMs and CMs but now it is an army of senior officers. An organization making losses can still have highly paid executives, expensive vehicles, furnished offices, foreign travel, housing, medical benefits, bonuses and other privileges. When losses accumulate, the taxpayer is ultimately expected to foot the bill through government support, subsidies to the tune of Ra 1.363 trillion. This is fundamentally wrong. If a private company is profitable and its shareholders willingly approve a huge salary for a successful CEO, that is a matter for its owners. But an SOE is different. Its money ultimately belongs to the public. A loss-making state enterprise cannot reasonably demand sacrifices from the taxpayer while simultaneously maintaining executive privileges resembling those of a wealthy multinational corporation.
Where is the accountability? The most serious defect is not even the salary itself. It is the absence of meaningful accountability. If an SOE continuously loses money like PIA, Pakistan Steel and BISP, who is held responsible? If vacancies are created without genuine organizational need, who answers for them? If auditors repeatedly raise objections, who ensures that those objections are addressed? If expenditure increases while performance deteriorates, who is held accountable? If a CEO completes his tenure after the organization has accumulated losses, does anyone examine his decisions and performance before granting another appointment or retirement benefits? In far too many cases, the answer appears to be nobody. The system seems designed to hold junior employees accountable for minor administrative violations while senior management and bureaucrats escape scrutiny for decisions involving billions of rupees. The bureaucracy is also part of the problem. This cannot be blamed only on CEOs. The bureaucracy and ministries supervising these organizations must also accept responsibility. A CEO does not operate in a vacuum. Boards are appointed, ministries exercise oversight, financial rules exist and auditors examine accounts primarily sit to regularize irregularities. If irregularities continue year after year, the question must be asked: where were the supervisory authorities? Audit objections cannot become merely routine paperwork. An objection raised by the Auditor General or an internal audit department should trigger a defined process, with responsibility fixed and a deadline for corrective action. Otherwise, audit becomes an exercise in recording irregularities rather than preventing them. A uniform ceiling is necessary. Pakistan urgently needs a rational and transparent compensation policy for SOEs and government corporations. There should be a clearly defined maximum ceiling for the total monthly remuneration of the chief executive, including salary, allowances, official residence, vehicle, utilities and other monetary benefits.
A ceiling of Rs 2 million per month, including perks, could be considered as a starting point, subject to a transparent review by an independent authority. Exceptions, if genuinely necessary to attract specialized international-level talent, should be rare, publicly justified and approved through a central mechanism-not created at the discretion of individual organizations. Most importantly, remuneration should be linked to performance. A CEO of a profitable and efficiently managed enterprise should not be treated in exactly the same manner as the head of an organization that requires continuous government subsidies. Pakistan is not an oil-rich kingdom. It is a country struggling under enormous debt, paying billions in debt servicing and repeatedly turning to external lenders to meet its financial requirements. In such circumstances, maintaining a privileged executive class within loss-making government organizations is not merely financially imprudent-it is morally indefensible. The ordinary citizen is asked to pay more taxes, accept higher electricity and gas prices and endure cuts in public expenditure. At the same time, government corporations can continue to operate with lavish executive packages and privileges. This double standard must end. The solution is not simply to reduce salaries arbitrarily. The real solution is to reform the entire system: rationalize pay scales, eliminate unnecessary posts, link compensation with performance, strengthen boards, enforce audit objections, publish executive compensation and establish personal accountability for major financial decisions. The real question is: who is accountable?
Pakistan has no shortage of rules, committees, auditors and ministries. What it lacks is the political and administrative will to hold the powerful accountable. A system in which a junior employee can face disciplinary action for a minor mistake while a senior executive or bureaucrat can preside over years of losses without consequences is inherently defective. Public office must carry public accountability. If an SOE belongs to the people, its management cannot be allowed to treat it as a personal kingdom. If the organization is losing money, its leadership must answer. If posts are created unnecessarily, someone must be held responsible. If audit objections remain unresolved, responsibility must be fixed.
Pakistan is already paying the price of decades of mismanagement. It cannot continue paying for executive luxury, bureaucratic expansion and institutional inefficiency while ordinary Pakistanis are repeatedly told that the country has no money. The era of unlimited executive privileges in loss-making state enterprises must end. The government must streamline the system, impose financial discipline and, above all, introduce accountability at the top not merely at the bottom. When a country is facing a severe financial crisis, allocating millions in compensation to corporate heads is entirely incomprehensible. At the same time, expecting ordinary workers to survive on a meager declared salary of Rs 40,700 (but not paid) is completely unjustifiable. Bridging this glaring economic divide requires fiscal responsibility starting from the top, ensuring that those bearing the brunt of the hardship are not shortchanged while executive excesses continue unchecked.
