The staff welfare cost of public sector undertakings (PSUs) has grown, in percentage terms, at a lower rate during 2009-10 compared with the previous year.
The employee welfare cost of 60 PSUs (excluding banks and NBFCs) saw a growth rate of 5.3% in ?09-10, while the corresponding figure for ?08-09 was 21.6%. Staff welfare expenses accounted for less than 1% of net sales of 60 PSUs in 2009-10, adding up to Rs 698 crore. SAIL, ONGC, BHEL, NTPC and HPCL are spending a significant sum on welfare schemes for their employees. For example, NTPC spent nearly Rs 280 crore on employee welfare last year, though it was less than what was spent in the preceding two years.
This study of 60 PSUs reveals a marginal increase in the ratio of welfare expense to total income to 0.58% in 2009-10 from 0.53% in the year 2007-08.
In actual value terms, the staff welfare cost of 60 PSUs steadily increased from Rs 2,486 crore in 2007-08 to Rs 3,023 crore in 2008-09 and further to Rs 3,184 crore in 2009-10. The total sales of these PSUs, however, saw ups and downs in the last three years. Their sales increased from Rs 4.68 lakh crore to Rs 5.73 lakh crore in 2008-09 and decreased to Rs 5.53 lakh crore in 2009-10.
Among the top ten PSUs by staff welfare spend, the highest growth in staff welfare cost during 2009-10 was seen with National Fertilisers, followed by HPCL, Bharat Electron and SAIL. The total staff welfare cost of SAIL steadily rose from Rs 337 crore in 2007-08 to Rs 564 crore in 2009-10. The share of welfare cost to sales of SAIL went up from 0.85% during 2007-08 to 1.39% during 2009-10.
Out of top 10 PSUs, the lowest growth in welfare cost was seen in the case of BHEL followed by ONGC. The staff welfare cost of ONGC increased from Rs 333 crore in 2007-08 to Rs 418 crore in 2008-09 and to Rs 453 crore in 2009-10. The company has set up several trusts for the welfare of employees, like employees contributory provident fund trust, the post-retirement benefit scheme trust and ONGC sahayog trust.
One interesting aspect is that nearly 43% PSUs reduced their staff welfare expenditure during 2009-10. These include Power Grid Corp, Engineers India, Hindustan Copper, Shipping Corp of India, State Trading Corpand Tide Water Oil. The staff welfare spend of Hindustan Copper steadily fell from Rs 13.89 crore in 2007-08 to Rs 10.36 crore during 2009-10.
