Taiwan Power Co (Taipower, 台電) and the Ministry of Economic Affairs were censured by the government’s watchdog yesterday for paying bonuses to Taipower workers at a time when the state-run company’s losses were rising sharply.
Taipower paid out bonuses of up to 2.6 months of salary in 2009, 2010 and last year, despite recording losses of NT$1.3 billion (US$44.1 million), NT$18.1 billion and NT$43.2 billion for those three years respectively, the Control Yuan said.
The ministry, which supervises the power company, failed to properly monitor the company’s expenditure and performance, the Control Yuan said, adding that Taipower’s losses as of the end of May had exceeded NT$179.9 billion.
The Control Yuan also censured Taipower over irregularities in bonus payments at Taiwan Cogeneration Corp (TCC, 台灣汽電共生), a specialized cogeneration company in which Taipower holds a majority stake of 27.66 percent.
Since 2000, TCC has been paying bonuses to its staff for unjustifiable reasons, the government watchdog said.
In 2007, TCC paid out NT$25 million in staff bonuses, and NT$83.03 million in 2009 after setting up joint ventures, the Control Yuan said .
In so doing, TCC violated the Company Act (公司法) and other regulations, and Taipower failed to report the irregularities in time, the Control Yuan said.
The Control Yuan also said TCC’s board of directors had been receiving huge sums in bonuses.
In one case, a chairman of the company was being paid NT$5.6 million a year in bonuses, in addition to his regular annual salary of NT$3.1 million, and Taipower was unaware of it before the case reached the Control Yuan, the watchdog said.
The company was censured a day after the government decided to postpone implementation of a second round of electricity rate hikes.
The government earlier this year decided to raise electricity rates in three stages, saying the increases were necessary to meet rising global energy costs that are pushing Taipower deeper into the red.
However, the Control Yuan said yesterday that Taipower should also be overhauling its operations to find the cause of its losses, which have been accumulating since 2006.
A policy implemented from 2006 to last year that offered cheaper electricity rates to families of military personnel, schools and the agriculture sector also added to Taipower’s financial woes, the Control Yuan said.
The cost to the company from those reduced rates amounted to NT$30.1 billion, it said.