State-owned enterprises ordered to freeze hiring and promotions following pre-election surge in appointments

The Privatization and Corporatization Board (PCB) has instructed state-owned enterprises to significantly reduce spending on employee salaries and benefits and to suspend all staff promotions. This directive comes as part of a broader fiscal austerity measure aimed at mitigating the economic impact of ongoing instability in the Middle East.

In a letter sent to state-owned enterprises (SOEs) on Wednesday, the Privatization and Corporatization Board (PCB) directed companies to take all necessary measures to significantly reduce expenditures on employee salaries and benefits. The PCB further instructed SOEs to freeze all staff promotions and halt recruitment for any non-essential positions, even if those roles are included in the company's approved administrative structure, provided their absence does not disrupt core operations.

These measures were ordered following a surge in recruitment by various state-owned enterprises leading up to the Local Council Elections held on April 4. Companies involved in this large-scale hiring included MTCC, RDC, and WAMCO.

Additional measures mandated by the Privatization and Corporatization Board (PCB) include streamlining operations to ensure tasks are completed within official working hours and restricting overtime work to essential tasks only. The directive further instructed state-owned enterprises to implement all necessary measures to manage payroll expenses effectively in order to maintain sustainable cash flow.

The Privatization and Corporatization Board (PCB) has instructed state-owned enterprises to implement measures ensuring that expenditures are restricted solely to those essential for fulfilling the mandates outlined in their respective articles and memorandums of association. Furthermore, the Board directed companies to analyze the potential economic impacts of the ongoing conflicts in the Middle East and to take necessary precautions. It also emphasized the importance of considering the financial burden on the public when implementing such measures.

The PCB has also instructed companies to refrain from holding non-essential ceremonies and events. In cases where such events are necessary, companies with the required resources are encouraged to share them with others, while ensuring that overall expenditures are kept to a minimum.

Last Monday, the Privatization and Corporatization Board (PCB) also instructed state-owned enterprises to implement a series of cost-cutting measures. However, these measures do not include reductions in employee salaries and benefits, nor do they involve a freeze on granting promotions.

The measures announced on Monday include the suspension of all non-essential official travel and a reduction in overseas trips, with instructions to conduct meetings with foreign customers and suppliers online. Furthermore, officials have been directed to refrain from traveling in business class for essential overseas trips. The directive also mandates the immediate suspension of overseas training programs, requiring participants to join such sessions virtually instead.