Govt plans to release wheat to mills through auction

By Staff Reporter | The News Jun 21, 2023

The Punjab government is contemplating introducing an innovative auction system for issuance of wheat to flour mills from official warehouses.

As per proposed wheat release policy, instead of giving quota of highly-subsidised wheat to flour mills in the absence of a foolproof system about subsequent grinding of grain and selling to masses on controlled rate, the Food Department is pondering to sell wheat to flour mills in district-level through an open auction. Secretary Food, Zaman Watto, chaired a consultative meeting on ending wheat quota system for flour mills. According to a spokesperson for the Food Department, the government is also considering direct subsidy in the form of flour to the deserving households in addition to planning sale of wheat through auction by abolishing the quota system of mills. In view of past embezzlement of wheat quota, he observed, flour mills will be bound to sell the allocation of the respective district in the same district. The sale of government wheat through auction in the market will stabilise flour prices.

According to the official, how the government wheat quota system has been used by mills as a source of looting can be gauged from the fact that till March of this year some flour mills were found involved in selling wheat quota purchased at 2,200 rupees at double the price of Rs4,200 to 4,800 per maund. Four mills of a group located on Manga Raiwind Road were raided and it was found that these mills were completely closed but were taking quota regularly. Their daily quota was more than 8,000 maund. A high-level committee is conducting an inquiry into the entire incident.

Many flour mills have given consent to provincial Food Department for implementation of new balanced approach of providing equal opportunities to all flour mills to buy wheat from the government in a fair competition, the official said.

Progressive Flour Mills Group welcomed the proposal of Food Department, saying it will help end pilferage of highly subsidised wheat and direct benefits of billions of rupees government money will actually reach to masses in the form of cheap flour.

However, on the other hand, ruling group of flour mills decided to go to challenge the government move in the court and at Competition Commission of Pakistan. According to them, the sale of wheat on auction will be a bad move on political front.

Meanwhile, a malicious propaganda is being spread by some elements that the price of sugar has gone up due to the policy of the Food Department, added an official. In this regard, it is pointed out that the sugar price fixing notification was stayed by the court a few months ago by the sugar mills and the injunction is still in effect.

In the presence of a court injunction, the Food Department or other government agencies cannot fix or enforce the price.

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