BY CL Jose
Rs1000 cr KWA dues add to co’s financial woes
THIRUVANANTHAPURAM/May 23-2022: Lending credence to a serious concern of a section of the public, KSEBL management has endorsed that its employee cost is higher than several of its peers in the country.
KSEBL management has even stated that a reduction in employee cost to the tune of at least 7 per cent to 10 per cent is immediately required to bring the company into comparative operational economy
A review of the finances of KSEBL carried out by its Board recently has revealed that its Employee Cost is about double that of the all-India average in power sector, in relation to the respective revenue generation.
While KSEBL’s employee cost is estimated at 27 per cent of its revenue, the all-India average in power sector for employee cost is reportedly 15 per cent, according to a document released by KSEBL recently.
The high employee cost at KSEBL could be either due to the larger workforce or a relatively high remuneration pattern there, or could even be due to a combination of both.
These statistics paint an undesirable picture of the public sector undertakings in the state, where, for example, employees of yet another organisation owned by the same government, KSRTC, remain with their fingers crossed as to whether or not they will receive their next month’s salary.
While KSRTC is still a public utility service entity, though with its own inherent financial woes, KSEBL is now a company that has for long been reporting loss year after year.
Moreover, KSEBL currently sits on a fully eroded capital base, with a negative net worth of a whopping Rs11,000 crore and Rs15,000 crore debt pile. That said, the state’s sole generator and distributor of power, is reportedly set to see light at the end of the ‘long’ tunnel, soon.
The KSEBL management vouches that the receipts from the duty that has been allowed by the State government to retain with the company till March 2014 is barely meeting the commitment of pensions of former KSEB employees and subsidies directed by the Government as per Section 65 of the Electricity Act 2003.
KWA dues at Rs1000 cr
The non-payment of electricity charges by Kerala Water Authority (KWA) is also mounting despite the state government taking over the payment of bills as per non-plan.
Needless to say, the current arrears of KWA at Rs996.90 crore (excluding interest) is adding to the cost of finance of KSEBL further expasparating the financial position of the company.
The present rough cost projections show that if KSEB is not allowed to retain the electricity duty, there will be acute shortage of funds from the financial year 2024-25 onwards, and that could put pressure on pension disbursal.
“The employee strength and expenditure therefore need to be kept in strict vigil and control, and reasonable savings have to be effected through reducing avoidable recruitment to regular posts where technology savings are possible especially in Transmission and Distribution (T&D),” the Board observed
The possibility of automated centrally controlled operations in generating stations, substations and smart meter related savings in distribution network have to be considered seriously for the next five years by further innovating on the recommendations of the Board of Directors regarding restructuring.