The legislature’s Economics Committee yesterday declined to review Taiwan Power Co’s (Taipower, 台電) budget proposal for this year, with a majority of lawmakers demanding that the state-run electricity company submit a new budget that includes planned electricity rate increases.
Lawmakers from across party lines decided to delay the review because Taipower submitted the proposal before new Taipower chairman Hwang Jung-chiou (黃重球) took office last Tuesday.
A majority of the committee members said the company should submit a new budget proposal that takes into account recent developments and incorporates future reforms.
The company’s operations have come under close public scrutiny since the government announced last month that electricity prices would be increased substantially to help the company offset mounting losses.
Some critics have said that at least some of the company’s losses are caused by poor management and bloated pay scales, adding that consumers and the private sector should not have to pay for Taipower’s waste and inefficiency.
The company is expected to post losses of NT$86.1 billion (US$2.91 billion) this year, which would push its accumulated losses to about NT$190 billion by the end of this year, according to the Ministry of Economic Affairs.
Minister of Economic Affairs Shih Yen-shiang (施顏祥) said Taipower was not asked to produce new budget proposals when electricity rates were increased in 2006 and 2008.
Taipower’s budget proposals were usually made one-and-a-half years ahead of the review, he added.
Taipower had also eliminated favorable electricity rates for its employees and had reviewed spending on company vehicles, Shih said.
Taipower had already cut its original budget proposal of NT$$130.6 billion to NT$113.3 -billion to take into consideration the changing operational situation, Hwang said.
However, lawmakers said that price increases in 2006 and 2008 were minimal compared with the planned raises this year, with some saying that the budget cut was minimal and insincere.
Democratic Progressive Party Legislator Lin Tai-hua (林岱樺) said the company’s proposed budget should be returned, but KMT Legislator Yang Chiung-ying (楊瓊瓔) disagreed, saying if it was sent back, there might not be enough time to review the proposal during the current legislative session because the session is scheduled to end soon.
Yang suggested Taipower submit a simpler revision of the full budget proposal.
DPP Legislator Huang Wei-cher (黃偉哲) said that even if the proposal were reviewed during the next legislative session, Taiwpower would still be able to operate, and only new projects would be affected by the lack of new funding.
After much discussion, the committee chairman, Chinese Nationalist Party (KMT) Legislator Liao Kuo-tung (廖國棟), announced that the review of the Taipower budget proposal would be suspended.
Additional reporting by CNA