Extend current oil PSU chiefs term: Moily

Seeks tweak in cabinet proposal to increase the retirement age of board members,directors; writes to PM.

In an attempt to extend the service tenure of the current chiefs of his oil and gas PSUs,Petroleum Minister Veerappa Moily has asked the Prime Minister to alter a Cabinet proposal to give three more years to the existing board members.

I would like to stress the need for considering the proposal of fixed tenure for CMD/Directors in central public sector enterprises for five years or allowed to serve until the age of 63 years,whichever is earlier, Moily wrote to Prime Minister Manmohan Singh on March 26.

Last August,the Cabinet note from the Department of Public Enterprises provided time until 63 years for board members directors and CMDs who would be selected after the new policy was announced.

All executives who do not attain the age of superannuation on the date of the vacancy may be considered eligible in regard to age qualification. Those selected will be given a fixed tenure of five years or allowed to serve until the age of 63 years,whichever is earlier, said the Cabinet note.

But Moilys letter pushes for increasing the retirement age of the serving functional board members after Minister of Heavy Industries and Public Enterprises Praful Patel announced he was proposing that over a period of time public sector CMDs would get a fixed tenure of three years.

Most of our chief executives are offered employment,after superannuation,in the private sector where they continue to contribute for the next 5-10 years. The experience they acquire during their service should rightfully be utilised in the respective PSU themselves, Moily wrote to the PM.

His argument is that frequent changes over 2-3 years were detrimental for the organisation. Since programmes related to modernisation and expansion of CPSEs have a high gestation period,the proposal for fixed tenure for CMDs/functional directors merits favourable consideration.

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If agreed to,it would extend the tenure of the current CMDs at Bharat Petroleum,Hindustan Petroleum,Oil amp; Natural Gas Corp,Engineers India Ltd and Indian Oil Corp,who are due to retire in the next one year on turning 60.

At present,there is no fixed tenure for CMDs and directors of CPSEs who retire at 60. A key eligibility criterion for executives to become CMD is that they should have minimum two years of service remaining on the date of vacancy.

The S K Roongta Committee on public sector reforms recommended in November 2011 that the tenure of CMDs/Directors in CPSEs be fixed at minimum three years at the time of first appointment. To allow this,it suggested removing the criterion of minimum two years of remaining service at the time of vacancy. The recommendations were circulated through the DPE Cabinet note. It is being considered by a GoM.