PMO To Prepare A Roadmap To Cut India Post Losses
Express News Service
NEW DELHI: With India Post joining the club of loss-making Public
Sector Undertakings, pipping both BSNL and Air India, the Prime
Minister’s Office (PMO) has asked for a report from the telecom ministry
on this. Last week, India Post had hit headlines after its annual
deficit touched Rs 15,000 crore in FY19, up by almost 150 per cent from
Rs 6,007 crore in FY16.
“The government is aware of the
financial situation at India Post. The PMO has sought a detailed report
and will soon do a consultation over improving the financial health of
the PSU,” a PMO official told TMS.
Once the report is submitted, the government will prepare a roadmap to pull the firm out of crisis.The loss of India Post is attributed to high cost involved in payment of salaries and allowances to its massive workforce. The cost of payment to its 4.33 lakh employees stood at a staggering Rs 26,400 crore in FY19. This included pension payouts, which is nearly 50 per cent more than the total receipts of Rs 18,000 crore.
Once the report is submitted, the government will prepare a roadmap to pull the firm out of crisis.The loss of India Post is attributed to high cost involved in payment of salaries and allowances to its massive workforce. The cost of payment to its 4.33 lakh employees stood at a staggering Rs 26,400 crore in FY19. This included pension payouts, which is nearly 50 per cent more than the total receipts of Rs 18,000 crore.
“The traditional postal services
continue to make loss. The department has diversified into other
services, but still saving schemes contribute to 60 per cent of the
total revenue,” a senior official from the telecom ministry told this
publication.
As per the company’s March 2018 annual
report, the total assets under management, including government’s
Special Securities and Floating Rate Bonds, rose to Rs 93,068 crore by
September 2018 from Rs 25,856 crore in March 2014.
Last year, the finance ministry had
advised India Post on taking a host of measures for generating revenue
and cut losses. “The Expenditure Finance Committee, which was headed by
the expenditure secretary, has directed the postal department to
increase user charges on services, hike product prices, utilise manpower
in more value-added services and to hive off products and services that
are cost-intensive,” a finance ministry official said. The ministry has
already hinted that the budget cannot bail out all loss-making firms.