Divestment panel to get back full powers

Among other things being considered by the GOM was giving a Sebi-like role to the commission to make the disinvestment process more credible and acceptable.

Sinha also pointed out that there were a lot of contradictions in the industry ministry8217;s 1996 resolution appointing the commission. He added the quot;commission cannot advise, implement and supervise atthe same time.quot; Later the same United Front government had curtailed the commission8217;s powers, restricting it to an advisory body. He further said a group of ministers were working out a mechanism under which the commission8217;s role could be enlarged within the framework of parliamentary responsibility. He added the finance minister will ultimately have to reply to questions in the parliament. quot;The intention will be to have the best resultsquot;, he stressed.

The minister also pointed out earlier governments were unclear about the policy and the purpose behind the divestment. The BJP government8217;s policy, he said, was to reduce government stake in non-core PSUs to 26 per cent.

This, he added, would also mean change of management. To make the process more acceptable to the people, the government was working out a mechanism through which the budget would establish a co-relation between the proceeds of disinvestment and social-sector programmes, he said. This would mean that one asset was being converted intoanother.

The minister also said that PSUs, which cannot be revived, will be closed down. quot;The PSUs cannot continue to be burden on the budget and people,quot; he said. He, however, added that the government will come out with a credible and acceptable voluntary-retirement scheme for rehabilitation of the displaced work force. Thereafter, the closed company8217;s assets will be disposed of.

Referring to the fact that the commission had recommended strategic sale for 24 PSUs but no action had been taken in case of 21 PSUs, the minister said that there was a resistance from the bureaucracy against privatisation of the public sector. He added that a mechanism had to be evolved to prevent delay in decision making.

Taking a dig at bureaucracy, the finance minister said bureaucrats have vested interests in opposing PSUs8217; privatisation. quot;PSUs, for some bureaucrats, are something which they can feast on. This mindset has to change,quot; he said. Similarly, chief exceutives of quite a few PSUs create quot;impedimentsquot; in the wayof privatisation in fear of losing their powers.

quot;My government is aware of these problems and is determined to go ahead with privatisation of PSUs in the larger interests of the people,quot; he said.

Earlier, presiding over the function, Ramakrishna raised various issues concerning the commission8217;s powers. He made a case for strategic sale and added that if at all it was necessary to divest, domestic investors will be allowed to participate in the process. Referring to Concor, he reminded the FM that the commission had recommended sale of shares to institutions and public at large.