Government imposes cost-cutting measures on SOEs

Other allowances work out to at least an additional Rs.75,000 per month, official data revealed.

Board members of SOEs have been barred from using official vehicles other than for the purpose of attending board meetings.

They are entitled to a monthly allowance of Rs. 25,000 regardless of the number of board meetings held within the month. Earlier they were paid Rs.10,000 per sitting at a board meeting irrespective of the number of meetings per month.

However allowances specified in this circular will not apply for some SOEs and those amounts will be decided by the Minister and Secretary of the line ministry and Board of directors of the relevant institutions considering the competitive market rates paid by similar institutions.

These institutions are state owned banks, SriLankan Airlines, Sri Lanka Telecom, Sri Lanka Insurance Corporation, Associated Newspapers Ltd, and Thomas De La Rue Lanka Ltd etc.

Chairmen and board of directors of most of these state owned entities are yet to be appointed, trade union leaders said adding that the new programmes cannot be implemented under the present set up.

These institutions are functioning virtually headless, they complained.

“Appointment of working directors (a common practice earlier) has been prohibited while all Chairmen and the Board of Directors must make a comprehensive assessment of the operations of the entities at the outset specially related to the operational status, human resources and financial position,” the circular stipulated.

SOEs have been directed to pay particular attention to rationalise and control the expenditure relating to advertising, marketing and promotional budgets with special control over fuel, electricity, communications, travel, use of vehicles, purchase of office equipment, furniture and other office facilities.

All procurements must be undertaken having followed the due procedures and all SOEs must have a procurement plan approved by the Board of Directors.