Regulatory bodies’ issue

By transferring administrative control of five vital regulatory bodies to their respective ministries the Federal government has not only dealt a severe blow to independent accountability and regulation but has also raised some serious questions regarding its will to ensure transparency in major deals. Under the decision National Electric Power Regulatory Authority (NEPRA) has been given under the control of the Water and Power division, Oil and Gas Regulatory Authority (OGRA) under the Petroleum and Natural Resources division, Pakistan Telecommunication Authority (PTA) and Frequency Allocation Board (FAB) under the Information Technology and Telecom division and the Public Procurement Regulatory Authority (PPRA) under the Finance Division.
The regulatory bodies previously used to report to the cabinet division and were an important check on the abuse of power by ministries. With the regulatory bodies now working under the ministries there independence has been negated. It has been suggested that the decision was the result of the resistance two key regulators – NEPRA and OGRA – had been showing in implementing directives of the relevant ministries on matters of public interest, particularly tariff issues.
These regulatory bodies were given under the cabinet division by various governments in the past to ensure that they enjoyed independence in decision-making instead of being subservient to the ministries for routine administrative issues like approval of leave, visits abroad and appointments. The Council of Common Interests (CCI) had deferred the consideration of a summary of the cabinet division purportedly prepared on the guidelines of the Ministry of Water and Power on NEPRA after the chief ministers of two provinces expressed divergent views on the subject. NEPRA was said to have stunned the Ministry by strongly opposing the profound amendments in the NEPRA Act, 1997, arguing that any such attempt would destroy the autonomy of the regulator and reduce its role to a rubberstamp.
The prime minister bypassed the Council of Common Interests and used his power under the Rules of Business to reallocate the powers of the ministries. For now though, the laws governing the regulators have not been changed, which would still give them some chance to withstand pressure from the relevant ministries. In a related development owners of about 2.5 million vehicles in the country running on compressed natural gas were left at the mercy of market as the government formally designated CNG filling stations a deregulated business.
The government has already been facing regarding issues of transparency particularly in the liquefied natural gas (LNG) deal with Qatar, the Lahore Orange Line Metro project and the various projects initiated under the China Pakistan Economic Corridor (CPEC) with the Pakistan Peoples Party vocal in its criticism regarding the matter. The party has also announced to take the matter of regulatory bodies to the Supreme Court.
The government maintains the decision was taken purely on administrative grounds however tension between regulatory bodies and there in line Ministries paint a different story. The government needs to ensure that transparency and regulatory functions are not hindered in any way, otherwise the long term investment prospects in the country will be harmed for temporarily gain.