‘Gas charges surged by 1,109% in a year’: Ministry disputes PBS calculation

• Energy ministry claims increase due to issue in calculation. 
• Ministry, PBS discuss methodology used to calculate hike.
• Ministry says 57% customers are in category where there is no hike. 

ISLAMABAD: Gas charges have increased by a whopping 1,108.59% in the outgoing week of November as compared to last year, The News reported Saturday citing an official by the Pakistan Bureau of Statistics (PBS).

The charges for the lower quintile, based on the Sensitive Price Index (SPI), witnessed a hike in prices by 1,108.59% in the week ended on November 24. 

On the other hand, the Ministry of Energy claimed that gas prices went up 65% on average with effect from November 2023, so there is something fundamentally wrong somewhere resulting in massive differences in calculation worked out by both sides.

Top official sources confirmed to The News that the Ministry of Energy took up the issue with the PBS and inquired about the methodology used to calculate such a massive hike. 

In last week's SPI, the bureau had calculated gas charges for the lowest quintile in the range of 480% for the latest week compared to the same week of the last year. The Ministry of Energy and PBS high-ups held meetings but both sides failed to strike a consensus on any workable solution mutually agreed by both sides. 

The ministry took the stance that there were two categories, protected and non-protected, and almost 57% of customers belonged to the category of protected customers where there was no surge in the prices. The high-ups inquired about the methodology and asked the PBS to furnish the notification of the Oil and Gas Regulatory Authority (OGRA). 

It was also inquired whether the PBS took the energy ministry or OGRA into confidence or secured any authentication at the time of changing price data methodology a few years back. 

“We have sought an authentication letter from the PBS but it was argued that there was a set methodology which cannot be changed in line with international standards,” sources said.

Another official commented that the PBS had shown declined prices of electricity in August 2023, when the whole country was making a hue and cry over inflated bills. There is a need to ascertain reasons for the rate but also obvious episodes resulting in the tarnishing of the credibility of official statistics.

Now the PBS high-ups argued that the Ministry of Energy has jacked up fixed charges for all categories including those who fell into the category of protected consumers and the 18% GST was also charged. So far the fixed charges on the bill have gone up from Rs121 to Rs1,400 for low quintile customers so the average cost of customers was calculated accurately. There is no mistake in calculating the prices of gas charges for the low quintile, they added.

Now the PBS will release the Consumer Price Index (CPI) data on December 1, 2023, and on the basis of the trend and other macroeconomic indicators, the Monetary Policy Committee of the SBP will decide on the policy rate in its scheduled meeting on December 12. The policy rate stands at 22% at the moment.

Independent experts say that the authenticity of the official data requires more transparency so the methodology and calculation of gas and electricity should be streamlined.