Revenue or mandate?

Is it revenue or mandate of a government corporation that determines whether it goes under DHI?

Druk Holding and Investments (DHI) only takes revenue generating corporations under its wings and doesn’t seem intent on including others, especially the state-owned enterprises (SOEs) that don’t generate big revenue. This means the government’s priority is money and not mandate of the companies. Some people say this approach is not in line with GNH.

The SoEs include Bhutan Postal Corporation, Bhutan Agro, Food Corporation of Bhutan, Bhutan Development Bank Limited, and Bhutan Board Products, among others.

These companies don’t make as much money as DHI-owned companies. Some observers say that doesn’t mean they are less important. Some of these companies, in fact, have bigger mandates than some of the DHI-owned companies.

“BBS as the public service broadcaster has one of the biggest public service mandates,” said a private sector employee. “The fact that it doesn’t make money doesn’t make it less important than, say, the Bank of Bhutan.”

A government official, however, said it is only because of the huge social mandates of some of these companies that they might not fit under DHI’s umbrella, which is the investment arm of the government.

It is up to the government to decide on this, said the CEO of Bhutan Postal Corporation (BPC), Tseten Geltsen. He said that as long as it remains a corporation, be it as a SoE or under DHI, it doesn’t really matter.

He looks at the issue rather differently. He said under DHI, the companies will become profit makers and not service providers.

The CEO said BPC has a different mandate of providing service to people. Still it is able to sustain with the revenue it generates with a little profit.

The CEO of Construction Development Corporation Limited, Phuntsho Gyeltshen, said it doesn’t matter if they work under DHI or not. “The decision rests with the government,” he said.

Tseten Geltsen suggested that instead of categorizing the companies into A and B, all should be placed at an equal footing. He said, “There shouldn’t be any categorization but if at all there should be, the position should be reversed.”

Companies with bigger social mandates but fewer avenues to generate revenue should be placed under category A and their employees paid more instead of placing them under category B.

He said if they are to focus on generating revenue and forget the social mandate, they can do so and reduce the number of staff from about 250 at present to less than 100, and charge customers the way the company wants. Today, they have many outlets that are not making any profit at all. “But we can’t do this, we have a huge social obligation to fulfil,” the CEO said.

The recently appointed managing director of BBS, Thinley Dorji, said the governemt should take the decision on this. “Our mandate is not to make money but to inform and educate public,” he said.

Rather than juggling the issue of functioning under DHI, he said there should be a clear guideline on BBS’s functions.

Although most feel that DHI companies are better privileged in terms of pays and perks, the BBS MD said the mandate of BBS is totally different.

Given the social mandate to fulfil, BDFC general manager for finance said they would not be in a position to contribute enough income like other companies to DHI. He said they are better off being an independent organization.

Meanwhile, the DHI CEO, Karma Yonten, said they submitted a proposal to the government last year to discuss the issue of taking other corporations under them. DHI is still awaiting a government directive. “It’s not that we don’t want them under DHI. We don’t decide on this matter,” he said.

By Sonam Pelden