Government brings Public Enterprises Direction Board (Formation and Working Procedure) Directive
The government is going to evaluate the current situation of privatised public entities to get the clear picture of privatisation and its impact, The government has brought the Public Enterprises Direction Board (Formation and Working Procedure) Directive released today.
However, lawmakers are not clear whether it is a major economic policy departure of Maoist-led government or ambiguous clause to 'please' donor communities.
"It is too early to comment either the Maoist-led government is back tracking the free market economy or is really committed to privatisation," Public Accounts Committee member Deep Kumar Upadhyay said, adding that it will, however, show whether Maoists wants restructuring of Public Enterprises or not.
Another lawmaker and former finance minister Dr Prakash Chandra Lohani said that the government should clarify its stand on privatisation through its economic principles.Appearing before Public Accounts Committee (PAC) under Legislature Parliament today, Prime Minister Dr Baburam Bhattarai, said that the government will start a fresh appointment of executive chives in all the Public Enterprises, according to the Board that has been brought to manage public enterprises in an effective way.
The Directives of the Board will be effective from today.
"The new Directives has clearly mentioned that the government will form a Executive Chief Appointment Recommendation Committee — led by chairman of Public Service Commission or its member — under the Board.
However, experts said that the motive behind introducing new Directives is not clear enough. "Implementing the Directives will be difficult,” Upadhyay said, adding that the government should show readiness to end political interference at first.
Formation of compatible laws according to new Directives is a big challenge to the government for its implementation, according to Lohani.
However, Prime Minister pledged to amend laws according to the new Directives. The government is also preparing to formulate new Act to make it compatible to the new Director, he informed the PAC.
The new Directives has introduced the provision of Performance Evaluation Committee to assess performance of executive chives. "The evaluation committee will be led by vice-chair at the National Planning Commission,” it said, adding that there will be a five-member board for policy formation, restructuring, monitoring and evaluation of public entities.
The government, in its budget for the current fiscal year and last one too, had pledged to form a separate High Level Public Enterprises Management Board.
A committee led by PAC member Upadhyay had earlier recommended the government for liquidation of three public enterprises, merger of some nine public companies and adopt Public Private Partnership (PPP) model in some cases. The new Directives has mandated the board to study and recommend the government on the restructuring, merger or liquidation.
Political bickering, incompetent human resources, over staffing and corruption have hit the public enterprises.
Public Procurement Act creating problem
KATHMANDU: Existing Public Procurement Act is much problematic for Public Enterprises to enhance their competitiveness, according to Prime Minister Dr Baburam Bhattarai. "Public Procurement Act is not conducive for public entities,” he said, adding that Gorakhkali Rubber Udhyog was closed due to adverse effect of Public Procurement Act. Public Enterprises have to face hurdles even to purchase raw materials, he informed. "The government has seriously internalised the problems and will amend the Act soon."