Criticising the public sector ndertakings under the West Bengal government, the Comptroller and Auditor General has said that with better management of its resources, PSUs' accumulated losses of more than Rs 6,000 crore (Rs 60 billion) could have been 'controlled'.
"The losses of PSUs are mainly attributable to deficiencies in financial management, planning, implementation of project, inefficient operation and monitoring," said a CAG report tabled in the state Assembly this week.
A review of three years' audit reports of CAG showed that the state PSUs' losses of Rs 6,072.96 crore (Rs 60.72 billion) were 'controllable' with better management.
"Losses can be eliminated or the profits can be enhanced substantially. The PSUs can discharge their role efficiently only if they are financially self-reliant," the CAG report said, while stressing on the need for professionalism and accountability in the functioning of PSUs.
During the year 2010-11, 40 PSUs incurred total losses of Rs 812.38 crore (Rs 8.12 billion) with transport service providers like The Calcutta Tramways Company Ltd (Rs 208.25 crore or Rs 2.08 billion) and The Durgapur Projects Limited (Rs 183.5 crore or Rs 1.83 billion)
leading the pack.
Stating that there has been no significant improvement in the financial position of the PSUs, the report said the return on employment has decreased from 6.14 per cent in 2005-06 to 5.97 per cent in 2010-11.
The transaction audit observations in the report highlight deficiencies in the management of PSUs which resulted in serious financial implications.
The Durgapur Projects Limited lost revenue of more than Rs 390 crore (Rs 3.9 billion) on annual fixed charges and incurred extra expenditure on repair of rotor, procurement of energy metres at higher rate and for not availing discount on oil price, CAG said.
Similarly, the West Bengal Power Development Corporation Limited incurred avoidable expenditure of Rs 11.28 crore (Rs 112.8 million) on excise duty, repair of ESP and interest on advance tax, the report said.