The Cabinet Committee on Economic Affairs has approved the proposal for providing budgetary support of Rs.70.41 crore for liquidation of statutory dues (Provident Fund, Gratuity, Pension, Employment State Insurance and Bonus) and salary and wages from 1.4.2010 to 30.6.2010 in respect of 10 sick/loss making Central Public Sector Enterprises (CPSEs) under the Department of Heavy Industry. These CPSEs are:
S.No. Name of CPSE Statutory Dues(In crore)
1. Hindustan Cables Ltd. 24.37
2. HMT (Watches) Ltd. 15.92
3. HMT Ltd. 5.67
4. HMT (CW) Ltd. 0.86
5. Nagaland Pulp & Paper Co. Ltd.(NPPC) (for two months) 1.59
6. Triveni Structurals Ltd. 0.72
7. Tungbhadra Steel Products Ltd. 0.63
8. Nepa Ltd. 5.59
9. Scooters India Ltd. 13.15
10. HMT Bearings Ltd. 1.91
TOTAL 70.41
Payment of outstanding dues of salary/wages would mitigate the hardships of the employees thereby motivating them for better output and prepare them to achieve the goal of revival / restructuring for the company. In addition, clearance of outstanding statutory dues is likely to result in fulfilment of statutory requirement.
Revival / closure of these companies is yet to be finalized (except in the case of HMT Bearing Ltd. in which case revival plan already approved could not materialize and in case of NPPC, approval of escalation cost is to be obtained).
Background:
As a result of the revival plans approved in case of 16 CPSEs, eight PSEs have turned around and have posted net profit in 2009-2010. Initially in May/June, 2004, there were 24 CPSEs which were defaulting in payment of wages/salaries. Now this number has come down to 10 due to comprehensive restructuring efforts.
The Salary/Wages support is being provided by the Government since May, 2004. Prior to this approval, an amount of Rs.1953.76 crore has so far been sanctioned on seventeen occasions.
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