The government will launch a Voluntary Separation Scheme (VSS) for Utility Stores employees, sparking debate in the Public Accounts Committee over workers’ future, rising costs, and fears of eventual closure of USC.
The government has decided to introduce a Voluntary Separation Scheme (VSS) for employees of the Utility Stores Corporation (USC), a move that could reshape the future of the state-run retail network. The announcement came during a meeting of the Public Accounts Committee (PAC) on Wednesday, where officials confirmed that details of the scheme will be finalized and shared by Friday, August 22.
USC, once the country’s largest chain of subsidized outlets with nearly 5,000 stores and 11,000 staff, has been gradually winding down after the government shifted subsidies to direct cash transfers under the Benazir Income Support Programme (BISP). Officials said the VSS is aimed at easing the transition for employees, many of whom have served on contracts for over a decade.
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PAC members, however, voiced frustration over what they described as unfair treatment of workers. Chairman Junaid Akbar questioned why employees’ salaries had been withheld while the Managing Director continued to draw his pay and maintain official perks, including five vehicles at his residence. Other lawmakers warned that the VSS could pave the way for the eventual privatization or closure of USC, despite repeated assurances that the network would not be shut down.
The scheme is expected to affect thousands of employees, with reports suggesting that permanent staff will be prioritized in compensation packages. Estimates indicate that implementing the plan could cost the government more than Rs. 29 billion, a figure that includes retirement benefits and settlement payments.
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While the move is intended to reduce financial losses and curb corruption within USC, lawmakers urged the government to consider structural reforms instead of dismantling the institution outright. PAC member Naveed Qamar said that despite inefficiencies, Utility Stores had long provided vital relief to the public and any decision on their future should protect workers while ensuring affordability for low-income households.
