"The government is suggested to immediately liquidate Nepal Orient Magnetite, Timber Corporation, National Construction Company and Nepal Engineering Consultancy Service Center," reads the report that the commission submitted to the government recently.[break]
These four PEs are defunct since years back. Still, the government has not been able to take decision on how to manage their assets and settle their liabilities.
Likewise, it has recommended to the government to merge Industrial Estate Management Ltd and National Productivity and Economic Development Center; Nepal Transport and Goddown Management Company and Trade and Export Promotion Center; and Saskritik Sansthan and Nepal Sangeet and Natya Academy.
"The merger will enable those institutions to strengthen their financial capacity and raise their effectiveness," reads the report.
The commission has also pushed the government to divest its shares from Hetauda Cement Factory, Janakpur Cigarette Factory, Nepal Housing Development Finance Company and Nepal Bank Limited.
It has urged the government to reform and restructure the rest of the ailing PEs to give them new life. The commission has recommended to the government to effect reforms in eight PEs, called for restructuring 11 others and operate them under public-private partnership model.
The commission´s report has categorically recommended to the government to steer reforms in Nepal Food Corporation, Nepal Oil Corporation, Nepal Civil Aviation Authority, Gorkhapatra Samsthan, Nepal Television, Nepal Drinking Water Supply Corporation, Nepal Electricity Authority and Gramin Aawas Company.
"These eight PEs have been serving national interests like food and oil security, disseminating information, regulating the aviation sector and implementing targeted rural housing programs. Hence, the government should work to enhance their capacity and make their operations efficient," said a member of the commission, referring to the report.
The commission, on the other hand, has suggested the government to operate Udaypur Cement, Nepal Airlines Corporation, Nepal Telecom, Nepal Stock Exchange, Agriculture Development Bank, Rastriya Beema Samsthan, Nepal Industrial Development Corporation, Rastriya Banijya Bank, Deposit and Credit Securities Corporation, Civil Investment Trust and National Trading Limited under Public Private Partnership (PPP).
It has also asked the government to run Dairy Development Corporation, Nepal Drugs, Herbs Production and Processing Center, Janak Education Materials, Agriculture Inputs Company and National Seeds Company under the concept of cooperatives, by increasing the ownership of farmers in them.
On the back of lack of financial discipline and accountability in PEs, the report has also recommended to the government to immediately punish chief executives of PEs that failed to complete auditing on time and reduce arrears. It has also asked the government to amend bonus act to end the practice of PEs distributing bonus to employees even in cumulative loss situation.
According to the report, the government has lost 30 percent of total investment of Rs 86 billion it put in 36 PEs due to their poor performances.
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