VietNamNet Bridge – The managers of the state owned air carriers, power, petroleum and food corporations still can receive VND1 billion a year despite the bad business performance.
In May 2012, Vietnam Airlines Corporation, after repeatedly complained about difficulties, proposed the Ministry of Finance to allow it to enjoy the preferential tax on air fuel. At that time, the corporation estimated that the expenses on fuel would be VND303 billion higher than usual because of the fuel price increase.
The national flag air carrier, which makes up 30 percent of the total turnover of the domestic aviation market, then warned that if the difficulties could not be eased in the last months of the year and the input cost continued increasing, it may not fulfill the business plan.
The air carrier later reported the profit decrease in 2012, which was just equal to 1/3 of the year before.
However, the reports by state management agencies showed that in 2012, the managers of the corporations still could earn VND1.1 billion, or VND90 million a month.
The same thing happened with the Electricity of Vietnam (EVN). In 2011, the economic group reported the heavy loss of VND5.3 trillion from electricity trade. However, EVN’s workers still could receive relatively high wage of VND7.3 billion a month.
At that time, Deputy General Director of EVN Dinh Quang Tri said on local newspapers that the average income of EVN manager was a little over VND30 million a month.
Nevertheless, the reports by state management agencies showed other figures. The income that an EVN leader received in 2011, or the year when EVN incurred big loss, was VND840 billion, ranking the 27th among the 62 SOEs’ highest income earners.
The Vietnam Coal and Mineral Industries Group (Vinacomin) has repeatedly asked for the tax cut so far this year to help ease the current difficulties. However, the managers of the group still can earn big money. The leader of the group ranks the 16th with the income of over VND1 billion in 2011 and VND850 million in 2012.
As such, the managers of the big SOEs had the income of VND80-90 million, which is much higher than the average income of VND7 million for every worker of EVN and Vinacomin.
The noteworthy thing is that the managers of the state owned groups still pocket big money even though they made a lot of mistakes in the corporate governance and their enterprises’ business performance is unsatisfactory.
The State Audit, for example, has discovered a lot of problems in the investments made by the Northern Food Corporation (Vinafood 1) and the Southern Food Corporation (Vinafood 2). However, the leaders of the corporations still had sky high incomes.
In 2011, Vinafood 2’s ratio of post tax profit on the stockholder equity was 18.23 percent, while the post tax profit of the year was VND113 billion lower than in 2010. In 2012, its ratio of post tax profit on the stockholder equity was 4.49 percent.
The corporation incurred loss in a lot of investment deals, including the loss of VND59.5 billion from the investment in a shipping firm’s securities. The ratio of accounts payable on capital of the southern food corporation was high at 65 percent.
Meanwhile, Vinafood 2’s leaders still earned VND900 million – 1.5 billion in 2011 and VND980 million – 1 billion in 2012.
US1 = VND21,000