The state-run Bangladesh Power Development Board has left around Tk 7,734 crore idle in different short-term deposit accounts although the loss-ridden utility needs up to Tk 1,500 crore for balancing its three-month operational capital.
The entire money has been deposited under 14 heads as short-term deposits offering the power board merely 2.50 to 3 per cent interests when a long-term deposit could have earned more than double the rate, according to financial audit report of the board for 2016-17 fiscal finalised in January.
Of the idle amount, Tk 5,618 crore has been kept under the head ‘Central Bank Account’ operated by the power board’s head office while the rest has been distributed in 13 other heads, the report shows.
The power board’s finance and accounts controller Md Mizanur Rahman Sarker claimed that the money was kept in the STD accounts as it had been used frequently to meet the board’s day-to-day operational costs.
He told that the amount was needed for safe operation of a big utility like the power board.
A Power Division official, however, said that there was no scope for frequent uses of more than Tk 7,700 crore.
The audit report did not show frequent transactions in the accounts, he pointed out, adding that the amount of money could have earned more than double if the power board went for long-term deposits.
He said that the similar trend of keeping huge amount of money idle was also marked in previous audit reports.
Consumers Association of Bangladesh energy adviser M Shamsul Alam said that it was unacceptable that the power board had been keeping such a huge amount idle as the loss-incurring power utility could have used it in financing various projects, like construction of power plants that usually required the government to pay much higher interest rates for financing.
He apprehended that such bank deposits might have benefited some individuals.
He questioned the power division’s duty in overseeing such malpractices.
Mohammad Hossain, director general of Power Cell, government’s reform wing for power sector under the power division, said that he was unaware of the matter and would need to examine the audit reports before making any comment.
Officials alleged that there were syndicates involving officials of the power board and some banks who arrange such deposition of several hundred crores of taka in exchange for commission.
The power board earns Tk 2,100 crore to Tk 2,200 crore per month in revenue from sales of electricity while it needs up to Tk 2,500 crore a month as working capital leaving a shortfall of up to Tk 400 crore per month, said officials.
As per the standard operating procedure, an organisation like power board would require a three-month working capital, which means the board does not need to have more than Tk 1,500 crore before receiving subsidies in instalments, they said.
The power board’s inefficient financial management has already drawn criticisms from experts and the policymakers on different occasions.