PE employees’ productivity negative

PUBLIC enterprises employ a total of 31,755 individuals, but when it comes to their productivity, it has remained negative. Each PE employee share an operating loss of Rs 186,000, according to the Annual Review of the Public Enterprises 2013 made public by the Finance Ministry on Friday. The operating loss

of 37 PEs stood at Rs 5.91 billion each on an average in 2001-12. The trading group witnessed the biggest operating loss of Rs 10 billion, contributed heavily by the Nepal Oil Corporation (NOC) which has an operating loss of Rs 9. 71billion. The operating loss to each employee of the group stands at Rs 5.1 million. Industrial and public utility sectors also suffered operating loss, while service sector, social sector and financial sector attained profits. The report says although the PEs have excessive employees, it highlighted the shortage of skilled manpower. “There are complaints that PEs lack skilled and competitive manpower due to the lack of fair and transparent recruitment process,” states the report. “Likewise, the trend of appointing temporary employees and/or on contract basis has increased administrative administrative costs massively.” Administrative costs of PEs rose by 13.87 percent to Rs 32.94 billion last fiscal year from Rs 28.93 billion in the previous year. Of the 37 PEs, 23 saw their administrative costs rise, while the rest post drop. All the seven PEs under the industrial sector witnessed drop in their administrative costs, but they still incurred losses last fiscal year. Janakpur Cigarette factory, which has not been in operation for the last two years, got its staff paid off last week. The report said financial and managerial aspects of PEs have weakened as the employees are only focusing on increasing their facilities. Instead of a single representative trade union, PE managements have to deal with several trade unions affiliated to different political parties who make competing demands related to their facilities, the report said. “The employees are involved in political activities instead of works, which not only decreased their productivity but also weakened the management,” said Dhundi Pokharel, chief of PEs coordination division at the Finance Ministry. He said the PEs also lack latest technology, efficient manpower and infrastructure. It further said the PE management has also been giving rise to facilities without full approval from the concerned agencies which has added to the government’s liabilities.