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MINISTRY OF ELECTRICITY DECIDES TO PULL THE PLUG
BY AMENA BAKR
The stash of candles that civil servants keep
in their desk drawers these days are not just for birthday parties.
In recent months, the minister of electricity, Hassan Younis, has
been on a crusade, ordering his staff to cut the power to government
agencies that have repeatedly refused to pay their electricity bills.
With 95 percent of government agencies reportedly in arrears, civil
servants have been finding themselves working in the dark.
So far, the Ministry of Electricity has taken on Cairo Governorate,
a number of ministries and even the ruling National Democratic Party
(NDP). “We gave them so many warnings, but they didn’t
seem to think that we would go through with cutting the power since
we are both part of the government,” says Aktham Abul Ela,
first undersecretary at the Ministry of Electricity.
The problem of delinquent payments dates back decades. In 1999,
the Ministry of Finance (MoF) intervened in an effort to resolve
the issue. Since then, the MoF has deducted the amount owed by various
government agencies to the Ministry of Electricity from the debt
that ministry owed to the Ministry of Petroleum for fuel used to
generate electrical power. The Ministry of Electricity’s fuel
bill currently stands at approximately LE 2.1 billion.
“Over the years, the Ministry of Finance has paid this debt
using the payments due [to us] from government agencies, but now
the situation has changed and these agencies should be paying us
cash,” says Aboul Ela. He explains that the lack of cash payments
caused the Ministry of Electricity’s liquidity to dry up.
“We couldn’t take part in any project to expand or better
our service simply because we had no cash.”
After careful consideration, Minister of Finance Youssef Boutros-Ghali
decided four months ago to allocate a cash quota to all governmental
agencies to be used to pay their electricity bills. “This
system has two main advantages,” says Aboul Ela. “One
is that it gives us more liquidity, the other is that it forces
the agencies to save power as they are only given a certain quota
to spend.”
Yet it seems government agencies simply took the money and ran.
“Although they have received the cash from the Ministry of
Finance, they have been very late in transferring it to us,”
says Aboul Ela. The worst offender, he says, is the Cairo Governorate
office, which is LE 50 million in arrears. “We gave them so
many warnings,” insists Aboul Ela. “First a month’s
warning, then two weeks, then one week, then one day, but they failed
to transfer the cash,” he says.
In mid-October, the ministry decided enough was enough. A switch
was flipped and suddenly the governorate’s offices were completely
in the dark. The power stayed off for over 24 hours until the governorate
agreed to pay its electricity bill in full.
The power cut sent a strong message, says Aboul Ela. “I don’t
think that any of these agencies will be late in their payments
ever again, because they know that we are capable of cutting off
their power,” he told Business Monthly, declining to reveal
the amount owed by government agencies.
The Ministry of Electricity’s hardline approach opened the
door for other utility suppliers such as the Holding Company for
Water & Wastewater (HCWW) to tighten the screws on delinquent
clients. The water company hopes to collect some LE 7.3 billion
owed to it by various government agencies. “There are some
government agencies that haven’t paid their water bills in
over six years, and many others don’t even have a water meter,”
says Hussein Hamouda, head of public relations and customer service
at the Greater Cairo Water Company (GCW), a subsidiary of the HCWW.
Unfolding a paper sitting on his desk, Hamouda revealed to Business
Monthly a long list of names of government bodies that allegedly
still have outstanding payments. Among these are the Ministry of
Education, Ain Shams University, the Central Bank and Cairo Stadium.
“But the worst offender is the Cairo Governorate office, which
owes us around LE 207 million,” he says.
GCW was among the agencies whose electricity was cut for failing
to pay its bills. Now it in turn hopes to settle its debts by following
through on threats to cut off the water to those agencies that fail
to pay theirs. Hamouda, however, promises that all agencies will
be given sufficient warning before action is taken. “We all
know that water is life, so we can’t simply take this decision
before giving out enough warnings,” he says. “Besides,
if you don’t have light you can open the window, but not being
able to flush the toilet can be disastrous.”
Hamouda doesn’t think it will ever come to that. He says almost
all government agencies have indicated their intent to settle their
old water bills. “Even if they don’t pay the entire
amount all at once at least they are showing some sign of good will
to do so,” he says.
Aside from electricity and water, many of these same government
bodies owe millions of pounds in unpaid gas bills. “The total
payments due in gas bills are LE 200 million, with LE 18 million
due from homes and LE 182 million from various government agencies,”
said an employee of Petro Trade, the sole company responsible for
issuing and collecting gas payments.
Speaking to Business Monthly on the condition of anonymity, the
employee admitted it would be difficult to follow through on any
threat to cut off gas because so many parties are involved. Egypt
Gas is responsible for distributing gas, while Petro Gas handles
billing and collection and Town Gas monitors and repairs leaking
gas lines. “About five years ago we were all one company,
but now we’re divided into three separate entities with very
poor communication. That’s why we have problems cutting off
the gas from people who don’t pay,” the employee explained.
Even when it comes to stopping gas flow to homes that have been
abandoned for years or individuals who fail to pay their bills,
Petro Gas has major problems. “Technically, if you don’t
pay your gas bills your supply will never be cut off. We can threaten
people as much as we want, but in the end nothing will happen,”
the employee said.
Telecom Egypt (TE) refused to comment on the outstanding payments
that are owed by government agencies, but there is no doubt in anyone’s
mind that these figures do exist. Yet unlike the other agencies,
TE already has a policy in place to handle overdue accounts. The
fixed-line telephone company routinely cuts the lines of individuals
who do not pay their phone bill within one month of its due date.
However, it is not clear how it handles delinquent government agencies.
As the utility companies become more proactive in collecting payments,
the possibility of intragovernmental conflict is bound to increase.
Aboul Ela warns that government agencies should seek to solve their
debt issues as diplomatically as possible. “In the end, we
are all working for the same goal, so we shouldn’t let such
cumbersome procedures cripple the activities of one another,”
he says.
A CULTURE OF WASTAGE
According to Aktham Aboul Ela, first undersecretary at the
Ministry of Electricity, civil servants waste far too much
energy. “Government employees have no problem with leaving
their lights and computer switched on all the time even after
they’re gone because they know that ‘Mama Government’
will pay for everything,” he says.
The Ministry of Electricity dispelled that myth last October
when it began cutting off the power to government agencies
that had not paid their electricity bills. Convincing people
to pay their bills is easy – just cut the power –
but getting them to conserve electricity is something entirely
different.
As such, the Ministry of Electricity recently assigned a team
to advise government employees on how to save power by doing
simple things such as shutting down their computers and switching
off the lights and air conditioners before they go home. “All
these tasks seem so trivial, but at the same time they can
save so much power,” says Aboul Ela. “So far people
have been responding well to the advice given... [but] we
can’t really tell right now if power is being saved
or not. It will take some time before we can judge.”
Water authorities are also trying to encourage people to conserve
resources. In its latest campaign, the Greater Cairo Water
Company (GCW) sent teams to government agencies to explain
to female employees ways of using water more economically
while cooking and cleaning at home. The results, admits GCW
spokes-man Hussein Hamouda, have been disappointing. “I
believe people here in Egypt will always waste water,”
he says. “It’s just part of our nature and culture
to do so, and it will take a very long time to change this
habit.” |
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