Despite an expected 10% jump in annual revenue, largely driven by the work generated from Aadhar and the unique identification authority, the department of posts may post a financial loss of around Rs 6,800 crore for the current financial year. This will be on account of over 4% increase in its expenses to Rs 14,380 crore, the department has projected for the current fiscal.
India Post says, its losses have spiralled in recent years, despite growth in revenues, after the implementation of sixth pay commission which has increased the outgo on salaries and pension. Five years ago, the loss for the department was around Rs 4,500 crore.
However, it is expected to increase its earnings in the current fiscal by 10% (compared with 2010-11) to over Rs 7,600 crore on account of increased realisations from its day-to-day activities including ordinary post, sale of postage stamps and speed posts among others. It also expects to generate Rs 1,200 crore in revenue from the enrolment and dispatch of Aadhar letter. In 2010-11, the department had generated a revenue of R6,963 crore. For FY13, it is expected to cross R7,600 crore, sources said.
However, Parliamentary Standing Committee on information technology, which oversees the functioning of India Post is unhappy with the department’s growing expenditure. It has asked India Post to ?contain? its working expenses over the next three months. ?We would like to be apprised about the concrete initiatives taken by the department in this regard,” Parliamentary panel has told India Post.
As reported by FE earlier, Parliamentary panel has already pulled up India Post for its lacklusture performance. The panel has once again directed the department to concentrate on increasing its revenues using all available means. The postal department has also been told to expand its business by adopting aggressive marketing strategy.
The house panel feels India Post has huge scope for improvement considering there are over 1,53,000 operational post offices whereas there are still 4,00,000 villages that do not have a post office.
However, not all is lost for India post. Its figures indicate a fast-growing popularity of ?Speed Post? whose revenue contribution to the department has jumped by 45% since 2008-09. In FY09, Speed Post generated R515 crore revenue which grew to R749 crore in 2010-11. This is because of virtual doubling of traffic for Speed Posts and express parcel posts since FY08. Four years ago, the traffic stood at 18.37 crore which jumped to 28 crore in FY11. It is expected to touch 40 crore soon, sources in the postal department said.