Monday, December 4, 2023

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First State Owned Enterprise (SOE) privatisation to take place soon

By: Staff Writer

Colombo (LNW): The first State Owned Enterprise (SOE) privatization will take place soon while the finalisation of a transaction advisor from the less-than-expected bids received is currently underway, Head of the SOE Restructuring Unit of the Finance Ministry Suresh Shah said.

Almost all proposals received for transaction advisors are a partnership between a local and international investment bank, he said adding less number of proposals for the transactions advisors could be due to the current economic condition, transaction size and the bad record on Sri Lanka for not completing privatisation processes in the past

There are around 130 commercial SOEs, more or less. That is the lot that we are looking at from a number of different perspectives.

One perspective is which of these 130 entities should remain with the government. That is one. 20-25 Soes will have to be manged by the government.

Then, which of these entities should be better served in the private sector? And thirdly, there are also some entities which are doing absolutely nothing, so they will be liquidated, he pointed out.

Power and Energy Minister Kanchana Wijesekara said the Government has prioritised economic sustainability over political gain by committing to restructure State-Owned Enterprises (SOEs).

Addressing various stakeholders including trade union leaders, civil organisation activists and journalists at the Finance Ministry on ‘Restructuring of Government Institutions for a New Development Approach’ he said restructuring SOEs is a critical factor to ensure financial discipline and establishing a stable economy.

“The Minister also said that the Ceylon Electricity Board (CEB) and Ceylon Petroleum Corporation (CPC) must be restructured to overcome the financial burden it has on the overall economy.

“All the SOEs must be restructured. By transferring the powers of decision-making to the Government, the business operations must be allowed via officials to handle. We need to create a proper system to manage those enterprises by restructuring,” he added.

Wijesekera also addressed the staffing situation within the CEB and CPC, revealing that there are over 4,000 vacancies in these institutions, surpassing the approved staff count. However, he emphasised that the existing workforce is sufficient to maintain operations and provide essential services.

As per the Minister, CPC has 3,292 approved staff positions, but currently employs 2,100 individuals, resulting in 1,192 vacancies, whilst CEB with 24,000 approved staff positions, employs 21,000 workers, and has brought in 3,000 external hires for specific tasks. This leaves a gap of 3,000 additional employees needed to meet the approved staff cadre. 

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