The State-Owned Enterprises (SOEs) incurred a net loss of Rs122.9 billion in FY 2024-25 as compared to a net loss of Rs30.6 billion in the previous fiscal year.

This was revealed in a meeting of the Cabinet Committee on State-Owned Enterprises (CCoSOEs) held on Friday under the chairmanship of the Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb.

The Cabinet Committee was presented with the Annual Consolidated Performance Report of Commercial and Non-Commercial SOEs for FY 2024-25, prepared by the Central Monitoring Unit (CMU) of the Finance Division.

The presentation, made by Director General CMU Majid Soofi, covered in depth detail of SOE 260 degree view covering the financial and non-financial performance of SOEs, government support and fiscal flows, contribution of SOEs to the exchequer, debt profile, corporate governance and compliance status, business plan assessments, and the proposed way forward under the SOEs Act, 2023.

The Committee was informed that during FY 2024-25, aggregate revenues of SOEs stood at approximately Rs12.4 trillion, reflecting a decline largely attributable to reduced profitability in the oil sector following lower international oil prices. Aggregate profits of profit-making SOEs declined by 13 per cent to Rs709.9 billion compared to Rs820.7 billion last year, while aggregate losses of loss-making SOEs showed improvement, declining by around two per cent to Rs832.8 billion.

It was highlighted that losses remain heavily concentrated in a small number of entities, particularly in the transport and power distribution sectors. National Highway Authority and several power distribution companies continued to be major loss contributors, reflecting structural issues, high depreciation, financing costs, and the public service nature of certain operations that are not commercially viable. The Committee was briefed on the categorisation of SOEs into green, amber and red categories based on financial sustainability, with a view to prioritising reforms and decision-making.

On fiscal support, the Committee noted that total government support to SOEs increased to Rs2,078 billion during FY 2024-25, driven mainly by higher equity injections to clear CD stock, while subsidies showed a modest decline. At the same time, inflows from SOEs to the government increased to Rs2,119 billion, supported by higher dividends, tax receipts and interest income on government lending.

The debt profile of SOEs was discussed in detail. Total SOE debt at the portfolio level increased to Rs9.57 trillion, comprising cash development loans, foreign re-lent loans, bank borrowings and accrued interest. The Committee was also briefed on the quantification of unfunded pension liabilities across SOEs, estimated at around Rs2 trillion, which was identified as a major legacy risk requiring policy attention. Guarantees and other off-balance-sheet contingencies were reported at Rs2.16 trillion.

The Chair commended the CMU for strengthening transparency, consolidating SOE financial information on an IFRS-aligned basis, and establishing a comprehensive digital database to support evidence-based decision-making. He noted that the presentation reflected meaningful progress in oversight, disclosure and risk identification, particularly in areas of fiscal flows, debt mapping and unfunded pension liabilities.

The Finance Minister emphasised that these improvements provide a credible foundation for informed policy action and sustained reforms, and reaffirmed the government’s commitment to improving governance, enforcing accountability, and placing State-Owned Enterprises on a path toward financial sustainability and operational efficiency.

While appreciating the progress achieved, the Committee members stressed the need for enforcement of audit completion in compliance with the SOEs Act, 2023, and timely transition to IFRS-based reporting by February 2026. The importance of realistic business plans, sector-specific engagement, loss reduction strategies and hard budget constraints, particularly for chronically loss-making entities, was also underscored.

The Cabinet Committee directed that the findings of the report be shared with relevant ministries to inform reform measures and that progress on audits, governance reforms, debt rationalization and fiscal risk containment be reviewed regularly.

The Committee approved the submission of the Annual Consolidated Performance Report for publication, noting it as an important step toward enhanced accountability, transparency and informed policymaking in the management of SOEs.

Earlier, the Cabinet body also considered and approved the appointment of independent directors in the Gujranwala Power Company (GEPCO), Jamshoro Power Generation Company Limited (JPCL), Energy Infrastructure Development and Management Company (EIDMC), Independent System Market Operator (ISMO), Islamabad Electronic Supply Company (IESCO) and Tribal Areas Electric Supply Company (Tesco).

The meeting was attended by Federal Minister for Power Sardar Awais Ahmed Khan Leghari; Federal Minister for Science and Technology Khalid Hussain Magsi; Federal Minister for Planning, Development and Special Initiatives Ahsan Iqbal; Federal Minister for Commerce Jam Kamal Khan; Federal Minister for Maritime Affairs Muhammad Junaid Anwar Chaudhry, along with Secretaries and senior officials from relevant ministries, divisions and regulatory bodies.