Friday, September 18, 2015

PMO wants roadmap for revival of 58 sick CPSEs

THE Prime Minister’s Office (PMO) has stepped into the process of divestment, wanting a clear roadmap for 58 loss-making Public Sector Enterprises. The Centre has already decided to close five of these units immediately, 11 will stop getting non-budgetary support. The PMO has asked the cabinet secretary to get an action plan ready for either the revival or the closure of the rest within a month.
The cabinet secretary has moved...
a note asking the department of disinvestment (DoD) to become the nodal ministry and take control over the entire process of overseeing the revival or closure of the sick PSUs.
The PMO's directive comes after an earlier effort to make it easy to do business in India and the government unveiled a series of steps to facilitate the process.
"It is a matter of great concern for the government because of the insolvency and sickness of the Public sector undertakings... Assets worth crores of rupees are locked in," the principal secretary in PMO Nirpendra Mishra was quoted as saying.
The cabinet secretariat wants the DoD to become the nodal ministry to look after the action plan and divestment of sick units.
Meetings were already held with 17 ministries to get their action plan. A set of questionnaire has also been sent to these ministries to get a clear picture of the units under them.
The PMO has asked the ministries for a clear demonstration of their viable business model, details of projected profitability and cash flow for 5 years.
The ministries have also been instructed to explain why the unit concerned was failing to make profits and its current market share.
The government has sold minority stake in three sick units this fiscal year to raise over Rs. 3,300 crore. With the sale of 10 percent stakes in Indian Oil Corporation, which fetched more than Rs. 9,300 crore, the government's disinvestment kitty is expected to swell to Rs. 12,600 crore -- the best first half in seven years.
This year, the government has a target to raise the highest ever amount - Rs. 69,500 crore -- from disinvestment. The DoD already has cabinet approvals for Rs. 50,000 crore worth PSU stake sale. However a volatile stock market is delaying the process of divestment.
Time and again, the government has been taking measures to revive ailing CPSEs. A committee of secretaries headed by former cabinet secretary and current chairman of the Public Enterprises Selection Board (PESB) Ajit Seth has also approved new parameters for revival of sick PSUs. The government has set up a committee under the NTPC chairman to explore the possibility of setting up a separate entity funded by financially strong CPSEs to look at management and revival of sick companies. Profitable PSUs have also offered to bail out loss-making companies provided their efforts are counted toward mandatory 2 per cent corporate social responsibility (CSR) norms.

9 comments:

  1. HSCL is a PSU under Ministry of Steel and under revival plan since 1999. The Company is having a T.O of 1500 cr with an Operating profit of Rs.100cr. However due to VRS loan the Co could not be getting Positive Net worth.
    Having a manpower of less than 100 on its Roll HSCL is presently running based on Retired people and contractual persons. People retiring from other companies are joining in HSCL with hefty remuneration. The pay scale of employees are due since 1997(IDA). Neither the Govt is taking any decision nor the Administrative Ministry did anything to bail out the employees. There is a rumour of Merger with NBCC which is not also strengthened. Either the VRS scheme should be implemented with the best plan for the surviving employees or should be closed if not viable. No more exploitation of the employees.

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    Replies
    1. Proposal for merger with NBCC is pending with PMO. The balance sheet of the company is to be cleaned and the interest on Govt loan to be waived off to proceed for merger. However having large order booking in hand and minimum liability of manpower Govt should take immediate action to merge HSCL with NBCC. The company has become a paradise of retired people from different companies and the employees on roll are suffering for the last 20 years with their pay scale due since 1997.

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  2. do something for bridge and roof company india limited.

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  3. Nothing will happened because most our Indian Bureaucrats are inefficient,they have no idea and talent to revive the sick psu.But they have TONNES of ideas to closure the psu.So please revives the salaries to this irresponsibles.

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  4. Govt without revising pay scale of employees of HSCL for the last 20 years has brought down the morality of dedicated employees of the company. A ray of hope emerges as a move is initiated to merge this PSU with NBCC. The company has a meagre less than 70 employees on its roll having practically nil liability. However total strength goes beyond 1200 including 40% of retired persons and other people taken on contract as and when desired not required. To give a shape to this PSU , Govt should take positive move to merge Hscl with any construction major at the earliest so that it can run like a Psu not like a private company.

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  5. HSCL is on a verge of transformation into a profit making psu subject to few changes that are to be enforced by the competent authority.
    1. Termination of all retired employees.
    2. Give incentive to the young engibeers so that they work hard and contribute more.
    3. Make a chain of command or hierarchy so that young engineers can see their future in the company. Promotion and change in designation can work in a long way to increase an employee's motivtion.
    4.Moreover each and every employees contribution should be microscopically studied at unit level and non performing candidates to be phased out judicially.

    HSCL has a huge order booking but because of sloggy attitude among employees due to lack of motivation and corrupt and vested interests of higher position executives the company is not able to deliver projects, thus effecting the turnover and overall progress.
    The management needs to seriously give a thought to better the morale of young Engineers.

    ReplyDelete
  6. HSCL is on a verge of transformation into a profit making psu subject to few changes that are to be enforced by the competent authority.
    1. Termination of all retired employees.
    2. Give incentive to the young engibeers so that they work hard and contribute more.
    3. Make a chain of command or hierarchy so that young engineers can see their future in the company. Promotion and change in designation can work in a long way to increase an employee's motivtion.
    4.Moreover each and every employees contribution should be microscopically studied at unit level and non performing candidates to be phased out judicially.

    HSCL has a huge order booking but because of sloggy attitude among employees due to lack of motivation and corrupt and vested interests of higher position executives the company is not able to deliver projects, thus effecting the turnover and overall progress.
    The management needs to seriously give a thought to better the morale of young Engineers.

    ReplyDelete
  7. Good initiative but must be implemented within 3 to 4 months to revive sick PSU`S, HOCL is only manufacturer of N2O4 in India supplying to ISRO but no salary for employees for last 9 momths

    ReplyDelete