Power ministry to spend more, rely less on PSUs

Power ministry to spend more, rely less on PSUs
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First Published: Tue, Oct 20 2009. 09 06 PM IST

Tight control: Power secretary H.S. Brahma. The public sector is tapped for resources such as drivers and laptops and even for organizing events.
Tight control: Power secretary H.S. Brahma. The public sector is tapped for resources such as drivers and laptops and even for organizing events.
Updated: Tue, Oct 20 2009. 09 06 PM IST
New Delhi: To reduce the use of facilities and resources of state-owned companies by ministry officials, the power ministry plans to raise budgetary allocations and hire more staff.
The ministry is likely to increase the allocation for this purpose to Rs4.5 crore from Rs1.5 crore and hire 100 people.
While the additional money will provide for laptops, mobile phones and vehicles, recruiting drivers and office assistants will also help.
Tight control: Power secretary H.S. Brahma. The public sector is tapped for resources such as drivers and laptops and even for organizing events.
“Though we have not finalized our budgetary allocation, this will curtail the dependence on the PSUs (public sector units),” said power secretary H.S. Brahma.
The Prime Minister’s Office had recently voiced concerns about ministries and departments using facilities and resources provided by PSUs.
“While directives have already been issued by the government, how much of this is implemented remains to be seen,” said a top executive of a power sector firm on condition of anonymity. “There are times when PSUs are under pressure from the administrative ministries.”
Currently, around 100 officials of state-owned power firms are deputed to the ministry and ministry bureaucrats are using resources such as vehicles of these companies for official purposes. There have also been instances when PSUs have been asked to organize meetings, workshops and conferences.
“Unlike in the US and Europe, where corporate governance issues relate more to management discipline and accountability, the problem in the Indian corporate sector... is that of disciplining the dominant shareholder and protecting the minority shareholders,” said Monish Chatrath, executive director at consultancy company Mazars India. “Regulators in India face a difficult dilemma in the correction of governance abuses, which are perpetrated by a dominant shareholder, particularly in cases where there is excessive micro-management of routine business decisions.”
The firms managed by the power ministry include NTPC Ltd, NHPC Ltd, Rural Electrification Corp. Ltd and Power Finance Corp. Ltd.
Agencies such as the Central Power Research Institute, the National Power Training Institute and the Bureau of Energy Efficiency are also under the ministry’s control.
The ministry is also responsible for a state programme to upgrade the electricity distribution system to minimize transmission and distribution losses. It is also implementing a rural electrification programme.
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First Published: Tue, Oct 20 2009. 09 06 PM IST
More Topics: Power | Electricity | PSU | Funds | Money |