SHILLONG, Sep 18: Many of the state public sector enterprises (SPSEs) have undergone capital erosion or loss of value of financial assets over time, the last report by the Comptroller and Auditor General said.
According to the report tabled in the House, the accumulated losses of seven functional SPSEs (₹2159.69 crore) have completely eroded the paid-up capital of ₹ Rs 1147.33 crore.
These seven SPSEs are the Meghalaya Government Construction Corporation Limited (MCCCL), Meghalaya Handloom and Handicraft Development Corporation Limited (MHHDCL), Meghalaya Tourism Development Corporation Limited (MTDCL), Meghalaya Transport Corporation (MTC), Mawmluh Cherra Cement Limited (MCCL) and Meghalaya Power Distribution Corporation Limited (MePDCL).
The MePDCL accounted for 73.58% of the eroded paid-up capital followed by MCCL with 17.21% and MTC with 8.11%, the CAG report said.
The report attributed MePDCL’s accumulated losses to low revenue realised against the sale of power, which was not sufficient even to meet even the power purchase cost mainly due to poor billing and collection efficiency.
The report said: “…Similarly, despite major capital investment in the MCCL, the company could achieve only 22% capacity utilisation against the projected capacity utilisation of 60-75, which was mainly on account of excessive machine stoppages, idling of machinery/ equipment and absence of skilled staff.”
The CAG said the MTC failed to grow as a major transport operator and could not compete with the private players in the state due to a number of reasons.
“The accumulation of huge losses by these SPSEs had eroded public wealth, which is a cause of concern and the state government needs to review the working of these SPSEs to either improve their profitability or close their operations,” the report added.