ISLAMABAD, Oct 3: The government has decided to defend before the Supreme Court ‘an average 30 per cent increase’ in electricity tariff for domestic consumers announced this week, with ‘minor procedural adjustments’ to balance out an IMF programme with the national mood.

As a last option, it may consider a slight reduction in the tariff hike for consumers using up to 300 units per month in view of the court’s concern for the low-income category.

An official told Dawn on Thursday that some amendments would be made to the procedure for notification of the new tariff and the National Electric Power Regulatory Authority (Nepra) would issue a fresh notification for the increase after withdrawal of the previous notification.

“I cannot rule out minor relief to a group of consumers using less than 300 units per month, but that would not change the overall subsidy allocation,” he said. This could be achieved by extending the benefit of the lower slab to domestic consumers using 200-300 units. As a result, the consumers in the 101-300 units category would be given the benefit of the previous slab of 101-200 units of Rs8.11 per unit.

Under the earlier notification, if a consumer consumed less than 200 units, he was to be charged at Rs8.11, but at 201 units his tariff would have gone up to Rs14 per unit for all units.

Several meetings were held on Thursday, including one presided over by Prime Minister Nawaz Sharif in which he expressed the desire to protect the low-income groups. A series of meetings were also held between the ministries of finance, water and power, law and justice and Nepra.

The official said the court had raised questions over some legal issues which would be sorted out by following the fashion adopted in the matter of oil pricing. He said the regulatory authority would then be advised about the subsidy envelop under Section 31 of the Nepra Act that empowered the government to issue policy guidelines. Nepra would notify the tariff based on the amount of subsidy.

He said the government had also considered empowering Nepra to notify tariff as it had determined on the basis of petitions filed by the distribution companies, but this would have increased the rates much higher than those notified by the government and this could have offended the court. Hence the proposal was shelved.

The official said the court would be briefed about the ramifications of violation of the agreements signed with the International Monetary Fund that could create difficulties for the entire nation, including international default.

According to an official statement, the finance minister briefed the prime minister on electricity tariff ‘rationalisation’. “The prime minister stressed that low-income groups must be protected at all costs.”

He said almost 70 per cent of electricity was being produced by using expensive furnace oil and only 30 per cent from water and inexpensive fuels.

The finance minister said 67 per cent of the domestic users consumed up to 200 units per month and had been fully protected from the tariff increase. “The national exchequer has incurred heavy losses because of lack of rational tariff adjustments in the past,” the official added.

He said the government was paying Rs167 billion in subsidy to protect the domestic users.

An official said that about 86pc consumers consumed up to 300 units per month.