Dismal Recovery Position of Government Loans from PSUs – Jammu and Kashmir Latest News | Tourism
Loss-making Public Sector Enterprises (PSUs) according to the strict business solution should be justly closed as not being able to make and record profits after incurring all the expenses of the process or sold to private establishments to operate in a strictly professional manner, regardless of the fate of the employees who work there and who, in the process, might be subject to the rigors of exercising needs-based requirements on the principle of how much production – in how many hours – by how many employees – against how many wages / wages, etc. In other words, surplus personnel under the process as it has been professionally developed will have to move and only those who could work hard to turn a loss-making entity into a lucrative one. Apparently, in an elastic democratic framework where social protection measures and the protection of the employment of employees almost reign supreme and are of the utmost importance, lead governments to bail out these loss-making entities by granting loans and advances with a very favorable repayment schedule, which, however, should be a short-term measure. Not only that, in addition to investing in cooperative societies, enterprises, etc., the government has, as a common and accepted practice, granted loans, advances and other monetary concessions to various other institutions and organizations so that ‘they have no account problems. finance necessary for the proper functioning of these institutions. However, although loans or give the term any name, liquid assets, as such, coming into the hands can change the face of these loss-making institutions provided they are professionally managed because it gives new life to the system to energize and rejuvenate. The said PSU therefore comes out of a loss scenario but it must be remembered that a loan is a liability that must be cleared because it directs the management of the PSU concerned to develop strategies and plans to achieve such favorable results. and imbues a sense of greater responsibility in employees to perform at their best, with other things remaining the same.
Having said that, it is incomprehensible that against an outstanding amount of Rs.923 crore in the form of loans and advances, a paltry amount of Rs. sternly commented by Comptroller and Auditor General (CAG) of India and since almost namesake recovery and not just poor recovery of loans and advances, was witnessed during 2019-2020, net increase in outstanding has resulted from the addition of nominal interest and other expenses. J&K (State) Road Transport Corporation (JKSRTC) for example, which remained in the red except for a brief period, now has a fleet of new modern tour buses, minibuses and the like. and not only operating in UT but also running long distance interstate services, has not refunded anything and a whopping Rs 377 crore is outstanding against the company. Instead, during the reporting period, Rs.7 crore was further advanced to the company. As some reform measures were implemented in the JKSRTC a few years ago to bring the Company on proper track and many employees as such had also sought the VRS facility with additional monetary benefits and some routes have been rescheduled for running services, still it looks like it is not only doing badly, but worse, which may jeopardize its survival even unless it becomes profitable.
Such a scenario cannot be allowed to continue to use public funds in the form of loans and advances to finance losses and not guarantee the end use, because these loans can be wasted on meeting consumption needs, payroll charges and not the creation of assets by these loss-making PSUs, which was also endorsed by the CAG of India and directed the UT government “to review its policy on loan disbursement and advances to loss-making PSUs”. We do not exclude the operational problems encountered by the loss-making PSUs concerned which can only be solved by employing appropriate strategies, reforms, innovations, improving services, facing competition from other players in domain, minimizing waste and unused capacity, etc. The obverse of all this hardly needs to be elaborate.