The Privatisation and Corporatization Board (PCB) has directed state-owned companies (SOE) to implement stringent cost-cutting measures to reduce costs and curtail expenditure.
In a circular shared yesterday, PCB emphasised the need for SOE’s to reduce travel and employee-related expenses. The directive mandates that only essential travel, both abroad and within the country, should be undertaken. Companies have been advised to prioritise online meetings with foreign suppliers and customers over physical trips. Additionally, when travel is necessary, employees are instructed to avoid first-class travel, even for trips exceeding six hours, and to opt for ferry services where available instead of air travel.
The circular further instructs companies to limit recruitment to essential personnel only, and to refrain from making any changes to salaries or allowances without prior approval from the PCB. Overtime work should be minimised, and payment of salaries and allowances in foreign currencies should be discontinued. Companies are also encouraged to leverage existing qualified employees for in-house training to avoid additional costs.
To further reduce operational expenses, the PCB advises companies to digitise their operations as much as possible to lower electricity consumption and reduce paper and stationery costs. Procurement expenditures are also to be kept within the company’s annual budget, and spending on Corporate Social Responsibility (CSR) initiatives and sponsorships should be curtailed.
Meanwhile, the government has announced additional steps, such as merging some SOE’s and restructuring others as subsidiaries, will be taken to minimise costs shortly.
