Govt firm against privatisation of public utilities

The State government is reported to have put its foot down against resorting to extreme measures, including privatisation, mooted by the 15th Union Finance Commission for resuscitating three public utilities and reiterated its commitment to protect the public sector. The Union Finance Commission (UFC), during the course of its discussions with Chief Minister Pinarayi Vijayan, Finance Minister T.M. Thomas Isaac and officials, had expressed serious reservations about the precarious financial status of the Kerala State Road Transport Corporation (KSRTC), Kerala State Electricity Board (KSEB) and Kerala Water Authority (KWA).

The UFC was concerned about the periodical fund infusion from the government to prop up the transport corporation that is striving hard for survival and also doubted the feasibility of regularly releasing funds to meet its committed expenditure, salary and pension.

The Commission is learnt to have aired concern that the KSEB too is headed for a financial crisis. The Commission stressed the need for evolving a roadmap for bringing the utilities back on track.


Since the Left Democratic Front (LDF) government is committed to strengthening the public sector and even expressed its resolve to take over the unit of the Central public sector undertakings functioning in the State, such as Instrumentation Limited, Palakkad, those represented the government in the consultations adopted a firm stance against privatisation or such other options to bring the three utilities out of the red.

Dr. Isaac is understood to have apprised the commission of the ₹1,000-crore revival package provided for the KSRTC and also a clear course of action set for turning it around within a prescribed deadline.

But the KSEB and KWA too would have to improve their financial position soon.

The government also pointed out the profit registered by the State public sector undertakings in the manufacturing sector following an internal reorganisation and restructuring initiated during the past two years as a case in point.

The Commission had also cited the contingent liabilities, mainly the guarantees issued under various heads, that are further weakening the finances under sever strain.

The government is reported to have argued the same situation prevailed at the Centre and it need not be construed as having a deep impact on the State’s finances, sources said.

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Printable version | Jan 15, 2021 7:20:05 PM |

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