Department of Public Enterprises likely to get more powers to regulate PSUs

NEW DELHI: The Department of Public Enterprises (DPE) may soon get additional powers to enforce regulations on all public sector units (PSUs), including navratnas and mini-ratnas. The government is considering a proposal under which DPE���s functional regulations for PSUs would be treated as government policy whose implementation would be mandatory.

The changes are being considered on the basis of recommendations of a Parliamentary standing committee, which has said that DPE guidelines must have the force of a government policy and not remain only an advisory where implementation is voluntary. However, to ensure the autonomous functioning of navratna and mini-ratna companies, the boards of these public sector units will continue to have the freedom of formulating their own policies.

Under existing provisions, boards of PSUs enjoy the power of not adopting DPE guidelines ��� provided they get approval of their administrative ministry and keep DPE in the loop. Therefore, a board resolution on the subject would have to be obtained and reasons for not adopting the DPE guidelines have to be given in writing.

According to the new proposal, the DPE will jointly monitor the implementation and performance of guidelines with the administrative ministry for the PSU. Currently, only those guidelines which are given in the form of a presidential directive are mandatory. The issuances of such presidential directives requires approval of the Union Cabinet.

���The changes are proposed in wake of the recommendations made by a Parliamentary standing committee on industry. The idea is to preserve the autonomy of the individual PSUs while enforcing common policies for all public sector companies,��� a DPE official said.

Currently, the department functions as a nodal agency to which all administrative ministries send the guidelines which they want to apply on PSUs under their control. The DPE reviews the guidelines before enforcing them so as to maintain a common policy for all public sector undertakings.

���We���ve constantly monitored the guidelines and in the past have removed several of them since they were no longer considered relevant in the changed economic situation. Also, some of them had been institutionalised over the years in various formats,��� the official said.

DPE has already initiated move to make PSU guidelines universally applicable by seeking details from administrative ministries and departments who exercise control over the PSUs. The DPE is preparing a action taken report on the recommendations of the standing committee that would also pave the way for PSU operations coming under a universal set of operational guidelines.