ECC Approves Rs30.2bn Grant for Utility Stores Corporation Shutdown

ISLAMABAD (Web Desk) — The Economic Coordination Committee (ECC) on Thursday approved a Rs30.216 billion package for the closure of the Utility Stores Corporation (USC), directing that the process be carried out transparently and in an organised manner.

The Ministry of Industries and Production presented the summary, which included measures for employee welfare and settlement of dues. The ECC allowed the sale of USC assets within the current financial year, with closure-related expenses to be met from the proceeds.

Chaired by Finance Minister Muhammad Aurangzeb, the meeting was attended by federal ministers Rana Tanveer Hussain, Jam Kamal Khan and others, while Energy Minister Awais Leghari joined online.

The committee stressed that employees’ rights would be protected, ordering immediate payment of dues, arrears and compensation. However, reports suggest around 12,000 workers are at risk of losing their jobs, with only 300 staff retained temporarily to manage the transition and privatisation process.

The government plans to clear all liabilities in three phases. USC’s current losses stand at Rs23 billion, while Rs14 billion remains payable to private vendors.

Earlier this year, the government ordered USC’s permanent shutdown effective July 31, ending decades of subsidised retail operations. Sales and procurement have been halted, inventories are being shifted to warehouses, and assets—including IT systems and equipment—will be auctioned.

The decision follows years of inefficiency, mounting losses and criticism over leakages in subsidy distribution. Once a major source of affordable essentials such as flour, sugar and cooking oil, USC struggled to remain viable.

Prime Minister Shehbaz Sharif has approved a Voluntary Separation Scheme (VSS) to cushion the impact on affected employees. Officials said the closure is part of a broader policy shift to streamline subsidies through more targeted platforms such as the Benazir Income Support Programme (BISP).

Founded in the 1970s, USC operated hundreds of outlets nationwide, but financial strain and changing government priorities have now sealed its fate.