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E.P.C defends decision

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E.P.C. Project Manager, Perelini Fonoti Perelini and Afoa Uelese Va’ai. Photo: Chris ThorogoodThe Electric Power Corporation’s Project Manager, Perelini Fonoti Perelini, has defended the government’s decision to make 62 employees of the Corporation redundant.

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He has also revealed that more jobs could be on the line as part of what he referred to as “right sizing” the Corporation.

According to him Perelini, the redundancy will save the Corporation $900,000 on the payroll.

Fonoti revealed the figure during a stakeholder consultation on E.P.C's proposed multi-year tariff held at the Millennia Hotel.

During the E.P.C’s presentation, a member of the Chamber of Commerce, who had seen an advertisement by E.P.C. tendering 15 new vehicles, posed a question.

“I saw in the paper that ad tendering for new vehicles,” he said. “So if you get 15 new vehicles [at] $100,000 per vehicle, [that’s] $1.5 million injected into replacing the 62 people that you already laid off.

“My question is, will you get away with 15 vehicles and ... all the vehicles probably sitting at the yard now?”

Perelini assured no one wanted to buy new vehicles. However, some of the vehicles the Corporation has are more than 10 years old and they cost more to maintain.

“They’re going through the fleet now and they will replace what they can.”

He said that E.P.C. is restructuring at present and are doing many things.

“One of them is downsizing or is it more like right sizing E.P.C. in terms of the number of employees,” he said.

Where there were 400 employees, there are now 357 employees.

“I know there were redundancy packages paid to them so there is a net saving on E.P.C., by going forward, you have $900,000 you don’t need to spend on payroll.”

In response to another question on whether the user charge can increase every three years instead of annually, Perelini said that the user charge includes payroll costs, materials and engine costs.

E.P.C. has no control over the latter as it is bought from outside.

What they can control is some of the local costs such as the payroll.

“Normally E.P.C.’s payroll is about $12 million... From a $125million operation, 12 percent or less... I thought is pretty good.”

“We laid off 62 people two days ago, that’s 900,000 in savings so E.P.C. is looking at reducing that cost, because these are costs that are within your control.”

Another major cost for E.P.C is insurance which is $800,000. This is to protect against natural disasters.

Perelini said that the depreciation is not recovered in the tariff.

“Unfortunately laying people off is not a very good thing to do but they had to bite the bullet and do these things in order to continue to lower the costs,” he said.

“EPC is also evaluating about... further downsizing, by outsourcing some of things they do.”

These involve powerlines, digging holes, pulling wires, putting up wires, trimming trees away from powerlines and running power stations. This would impact the operations side of E.P.C. and the number of mechanics and whether it would be cheaper to outsource.

Perelini stressed that it was all about lowering costs.

Earlier this week, employees that were made redundant were in tears and spoke of their struggles, frustrations and disappointment.

They spoke out as they exited the workplace they have served faithfully for many years with tears and sadness.

More than sixty men and women who were linesmen, drivers, cashiers, clearance officers and fault service workers received their redundancy packages during a meeting with E.P.C’s management.

While some were happy with amounts of $3,000 and $5000 each, the majority shrugged their shoulders and kept their heads low when they left the meeting.

 

 

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