PCB Issues Directive for Cost-Cutting Measures in SOEs

The Privatisation and Corporatisation Board (PCB) has instructed state-owned companies to implement stringent cost-cutting measures aimed at reducing operational expenses. 

Key among these directives is the elimination of dollar-denominated salaries and a significant reduction in travel and staff-related expenses.

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A circular issued by the PCB yesterday outlined the need for state-owned enterprises to take immediate actions to curtail costs. 

https://x.com/pcb_gov/status/1830897540902068732

The directive includes restrictions on travel, with overseas trips being limited strictly to official purposes. Companies have been advised to conduct virtual meetings with foreign clients and suppliers where possible, and to avoid first-class travel on flights shorter than six hours. 

Additional measures include cutting costs associated with foreign-sponsored trips, using ferry services in designated areas, and avoiding participation in fairs and seminars unless they provide direct business benefits.

Moreover, the PCB has urged companies to freeze recruitment, even for roles within the approved administrative structure, and to seek board approval for any adjustments to employee salaries or allowances.

The directive further encourages organisations to complete work within official hours, with overtime to be used only in exceptional circumstances. State-owned enterprises that generate revenue in foreign currency have been instructed to discontinue paying employees in dollars. 

Companies have also been asked to prioritise digital transactions over paper-based ones and to reduce spending on refreshments, corporate social responsibility (CSR) activities, and sponsorships.

These reforms come as part of a broader initiative to decrease government expenditure. Some state-owned enterprises have opted for mergers, while others are considering liquidation as part of the overall restructuring process.