Govt to shut down Utility Stores by July 31

The federal government has set July 31 as the final date for winding up operations of the Utility Stores Corporation (USC), marking the end of a decades-old program that provided subsidised groceries to low-income households across the country.

The decision was reaffirmed during a high-level meeting of the prime minister’s oversight committee on USC closure and privatisation, chaired by Finance Minister Muhammad Aurangzeb at the Finance Division. 

The session was attended by Special Assistant to the Prime Minister on Industries and Production Haroon Akhtar Khan, as well as senior officials from the Finance, Establishment, and Industries & Production divisions, along with the USC managing director.

Established in 1971, USC currently operates more than 4,000 outlets nationwide. The state-owned enterprise was originally set up to provide essential commodities at discounted prices to underprivileged communities. However, years of operational inefficiencies and mounting financial losses have pushed the government to dissolve the organisation.

Read: 6,000 Utility Store employees to lose jobs amid privatisation plans

According to the Finance Ministry’s Federal State-Owned Enterprises (SOE) Performance Overview for the first half of FY25, USC reported a loss of Rs4.1 billion, bringing cumulative losses to Rs15.5 billion.

The oversight committee report is expected by the end of this week.

The committee also recommended consultation with the Privatisation Commission to determine the most viable model for divestment, whether through full privatisation or selective sale of assets associated with USC’s operations.

Finance Minister Aurangzeb stressed the importance of a financially sustainable and equitable exit plan, noting the need to address legal complexities and mitigate the social impact of the closure.

Once the subcommittee finalises its findings, the main committee will consolidate its recommendations and submit them to the prime minister for final approval. Until then, USC outlets will continue to operate, with all services scheduled to cease by July 31.