PSUs back out of CWG commitments

Government-owned oil and gas companies,the most favoured milch cows for funding public events,have decided to refrain from sponsoring the Commonwealth Games...

Written by Amitav Ranjan | New Delhi | Published:August 20, 2010 2:29 am

Government-owned oil and gas companies,the most favoured milch cows for funding public events,have decided to refrain from sponsoring the Commonwealth Games despite incentives given by the Ministry of Heavy Industries & Public Enterprises to public sector units to use CSR funds and earn performance-related pay (PRP).

The heads of Oil & Natural Gas Corp,Oil India Ltd,GAIL India Ltd,Hindustan Petroleum (HPCL) and Bharat Petroleum (BPCL) confirmed that they have no plans to sponsor the games while sources said Indian Oil Corp,which was considering joining Indian Railways as one of the two leading sponsors,has developed cold feet.

Though IOC’s acting chairman,BM Bansal,had assured CWG Organising Committee (OC) chairman Suresh Kalmadi last month that it would sponsor the Games,no further steps were taken in light of the controversies that erupted over its functioning,they said.

Following allegations of financial irregularities against the OC,energy siblings National Thermal Power Corp and PowerGrid of India have pulled out their sponsorships — pledged at Rs 60 crore. The NTPC,which gave Rs 20 crore in February out of its committed Rs 50 crore,is seeking an audit.

Bharat Heavy Electricals Ltd,under the administrative control of the Ministry of Heavy Industries,has no plans either to use the money under its corporate social responsibility account to achieve its MoU targets.

The Department of Public Enterprises under the ministry wrote to all PSEs in June that “all contributions/donations/promotions/sponsorships to the CWG 2010 will be treated as a CSR activity and count towards the award of marks in the MoU evaluation process”.

Only with CSR activity can a PSE achieve an ‘excellent’ MoU rating and become eligible to get PRP at 100 per cent. Ratings of ‘very good’ and ‘good/fair’ would bring down eligibility levels to 60 per cent and 40 per cent respectively.

PRP is a form of incentive pay used in companies,where employee performance cannot be measured in terms of output produced or sales achieved.

Deshmukh takes U-turn,tells units to hold on
Heavy Industries & Public Enterprises Minister Vilasrao Deshmukh did a U-turn on Thursday,asking state-run companies to hold back sponsorship for the Commonwealth Games. In June,he had directed them to cough up money for the event as part of a ‘national enterprise’.

“We have already asked PSUs to hold on. Instructions were issued by DPE secretary to hold on (to) the funds,” Deshmukh said. The PSUs have pledged close to Rs 260 crore for the Games,which would start on October 3. Deshmukh’s volte face came in the wake of NTPC and PowerGrid announcing their decision to hold back funds,following numerous instances of financial irregularities. The minister’s statement reflected the crisis of confidence that the PSUs now have in the CWG Organising Committee,because of which most of them have kept away from pledging any amount. “After this controversy,I think no PSU is going to contribute,” Deshmukh said within hours of Congress President Sonia Gandhi telling her party MPs that “it (Games) was a matter of national pride and efforts should be made to hold them successfully”. The Central Bank of India has contributed Rs 50 crore to the Games,while the Indian Railways has made a budgetary provision of Rs 100 crore as lead sponsor.

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