Federal Govt Decides to Fully Close Utility Stores from July 10

The federal government has finalised the decision to completely shut down Utility Stores Corporation (USC) operations nationwide starting July 10, 2025.

This move is part of a broader strategy to reduce financial losses and restructure government entities. Prime Minister Shehbaz Sharif has directed that all USC employees be offered a Voluntary Separation Scheme (VSS) package as compensation for the closure.

In a meeting chaired by the Managing Director of Utility Stores Corporation, it was decided that all active stores will cease operations immediately. Inventory from stores will be transferred to warehouses, and under official supervision, goods will be returned to suppliers.

Additionally, all IT equipment from stores and offices will be recovered, and assets such as racks will be auctioned transparently. Notices will be issued to vacate rented stores by August 1, 2025. General managers will assess the value of USC assets through IT evaluations.

This closure follows a phased downsizing, where over 1,200 stores have already been closed and more than 2,200 employees laid off as part of a restructuring plan to reduce losses. The government plans to reduce the total number of operational stores from around 5,500 to 1,500, with the remaining stores expected to be privatised.

The decision aligns with the International Monetary Fund’s directives to cut losses and workforce at USC, which has been a significant financial burden, receiving subsidies of Rs 38 billion in the previous fiscal year. The government has also ended subsidies on essential commodities sold through these stores, including sugar, flour, and ghee.

The closure has raised concerns among over 18,000 USC employees who are reportedly considering protests against the shutdown. The government, however, emphasises that these reforms aim to reduce the fiscal burden and improve service delivery by either shutting down non-performing entities or privatising them.