Ranchi, Aug. 22: The 10 state-owned public sector units are proving to be white elephants for Jharkhand, the latest Comptroller and Auditor General’s (CAG) report has revealed.

According to the CAG report that was released by state’s principal accountant general (audit) R.K. Verma on Friday, the PSUs comprising 9,010 employees, have incurred controllable losses of Rs 1,894.39 crore and put in unprofitable investments of Rs 74.30 crore between 2006 to 2009. The net losses were pegged at Rs 292 crore.

The thrust of the investment on PSUs was in the power sector, which increased from Rs 488.59 crore in 2003-04 to Rs 3,874.95 crore in 2008-09.

The total investment in the 10 PSUs and their turnover together aggregated to Rs 5,463.02 crore during 2008-09. Out of them, Jharkhand State Electricity Board and Tenughat Vidyut Nigam Ltd (TVNL) together accounted for 98.71 per cent of the aggregate investment of Rs 3,874.65 crore and turnover of Rs 1,518.04 crore.

The losses suffered by the PSUs can be mainly attributed to inadequacies in financial management, planning, implementation of project, operations and monitoring.

The CAG report said that the state government had not formulated any dividend policy under which all PSUs are required to pay a minimum return on the share capital contributed by the state government.

According to the latest accounts, three PSUs — Jharkhand Industrial Infrastructure Development Corporation (JIIDCO), Jharkhand Police Housing Corporation (JPHC) and Jharkhand Tourism Development Corporation (JTDC) — earned an aggregate profit of Rs 0.76 crore but did not declare any dividend.

The CAG has also questioned the decision to purchase underground cable without assessing the actual requirement. “It resulted in blocking of funds of Rs 2.35 crore and a consequential loss of interest of Rs 0.76 crore,” the report added.

The public fund monitor said the state PSUs are being run inefficiently and that there is a tremendous scope for improvement in their overall performance.

“They need to imbibe greater professionalism to ensure delivery of their products and services. The state should introduce a performance-based system of accountability for PSUs,” the report said.

The CAG also pointed out that various PSUs have kept their accounts (statements of income and expenditure) pending for years, thus running the risk of fraud and leakage of public money.

“The state had invested Rs 3,640.53 crore in 10 PSUs during the years for which accounts have not been finalised.”

While TVNL has kept its accounts pending since 2000, Jharkhand State Mineral Development Corporation (JSMDC) has not completed its income-expenditure statement since 2003.

JTDC’s account is pending since 2004, the accounts of Jharkhand Hill Area Lift Irrigation Corporation (JHALCO) and Jharkhand State Forest Development Corporation (JSFDC) are pending since 2007, whereas JPHC’s account is pending since 2008, that of Jharkhand State Forest Development Corporation (JSFDC) since 2007 and the accounts of JIIDCO, Greater Ranchi Develpoment Agency (GRDA) and Jharcraft since 2006.

JSEB too had kept its accounts pending since 2002 and is said to have updated its accounts up to 2008-09 recently, after it was pressured by Jharkhand State Regulatory Commission.

“In the absence of accounts and subsequent audits, it cannot be ensured whether the investments and expenditures incurred have been properly accounted for, and whether the purpose for which the amount was invested has been achieved or not. The state’s investments in PSUs have remained outside the scrutiny of the state legislature,” the CAG report said.

The CAG had recommended the government to set up a cell to oversee and monitor the clearance of arrears and set targets for the companies.