Action, action

Successive governments have formed too many commissions and committees to look into the long-ailing public corporations (PEs) and suggest measures for turning them into cost-effective or profitable ventures. But not much concrete action has been taken to that end. If all those reports were put together, they would fill many shelves. The latest report, an interim one, has come from the five-month-old Corporation Reform Suggestions Committee headed by former industry secretary Dr Bhola Chalise. Unsurprisingly, it has concluded that most of the PEs are in an unenviable state. It has categorised them as bad and very bad, and added that both the privatisation and reform process for the PEs have stalled. Therefore, it has recommended the formation of a corporation reform commission to adopt policy for reform. Though the existing privatisation committee has representation from the political parties and the private sector, little has come of it.

The justification for this commission and for reform, according to the report, comes from the belief that in the present fluid political atmosphere, full-scale privatisation cannot move forward. As the interim government represents eight parties with different views on how to pull the PEs out of red, a consensus on the PEs’ outright privatisation may indeed be difficult to achieve at this juncture. However, even the Maoists may not be averse to the idea of starting the process of selling the shares to the general public. The symptoms of the disease are more or less common to all PEs, and the disease was diagnosed long ago. What is really needed now is not more committees or commissions, but concrete remedial action to bring the ailing PEs back to health. In this context, the great majority of the corporations have no option but to privatise. The government and bureaucrats, who cannot run the ministries and departments properly, cannot be expected to run commercial, industrial or financial enterprises professionally.

In the past, many reform measures were announced to revitalise the PEs but none worked. It is therefore hard to believe that any new reform measure without changing their ownership structure will now be effective at turning the PEs around. One or two governments also sought to put vigour into the PEs by hiring their chief executives on performance contracts, but that came to almost nothing. Poor performance of the PEs has a lot to do with the failure to exact accountability. For instance, government bureaucrats who occupy important positions as chairmen or members of the boards of the PEs or members of recruitment committees are not held accountable for their performance there. There has not been a consensus among the political parties either on exactly what to do with the PEs. Any government that came to power lacked clear vision and willpower to introduce far-reaching reforms. It treated the PEs as employment mills. The interim government can no longer afford to waste time on commissions or reports. The need of the hour is action.

Source: The Himalayan Times, July 5, 2007