T.N. plans to undertake financial and operational analyses of 50 PSUs, statutory boards

Consultant to study their performance based on available data for the last 10 years

The Tamil Nadu government is planning to undertake the financial and operational analyses of 50 PSUs and statutory boards under its Bureau of Public Enterprises. Eight State transport undertakings, discom, alcohol wholesale and retail vendor, Chennai Metropolitan Water Supply and Sewerage Board and Tamil Nadu Water Supply and Drainage Board are among them.

Tamil Nadu Civil Supplies Corporation, Tamil Nadu Small Industries Development Corporation, Tamil Nadu Industrial Investment Corporation, State Industries Promotion of Tamil Nadu, Tamil Nadu Industrial Development Corporation, Tamil Nadu Transport Development Finance Corporation, Tamil Nadu Power Finance and Infrastructure Development Corporation and Tamil Nadu Urban Finance & Infrastructure Development Corporation are also to be analysed.

According to a tender floated in this regard, the consultant would study the past performance of these 50 enterprises based on published or readily available data for the last 10 years and benchmark the performances with that of private sector competitors over six months. It will look into the gross profit and net profit trend, revenue growth trend, operational cost, cash management and contribution of various products to the profit of the company, among others.

It may be recalled that the White Paper on Tamil Nadu’s government’s finances released last year said the performance of State PSUs had a significant bearing on the finances of the government and could also pose fiscal risks. Of the 60 PSUs and nine statutory boards in Tamil Nadu, 26 PSUs were loss making, it had said. “The deteriorating financial situation of the PSUs has resulted in a scenario where they cannot borrow without a guarantee from the government,” it had noted.

The White Paper further said a detailed quantitative analytical risk assessment of PSUs based on various indicators needed to be undertaken. Reports of the Comptroller and Auditor General (CAG) of India and a high-level committee constituted under former Reserve Bank of India Governor C. Rangarajan too had discussed the performance of the State PSUs.