E-Paper
DPE back with FinMin for better coordination, effective asset mgt
The department came into existence in 1965 as the Bureau of Public Enterprises in the finance ministry as a centralised coordinating unit appraising performance of public enterprises, two officials aware of the development said requesting anonymity
The government has carved out the department of public enterprises (DPE) from the ministry of heavy industries and put it under the umbrella of the finance ministry to monitor performance of state-run firms, monetise their assets, and direct their procurements policies to boost local industries.
DPE has come full circle now. It came into existence in 1965 as the Bureau of Public Enterprises (BPE) in the Union ministry of finance as a centralised coordinating unit appraising performance of public enterprises, two officials aware of the development said, requesting anonymity. In 1985, BPE was shifted to the ministry of industry. Five years later, it was made a department, and subsequently put under the ministry of heavy industries & public enterprises.
“DPE is brought to the finance ministry for direct and better coordination. The purpose is to improve efficiency of CPSEs [central public sector enterprises], effective monetisation of their resources that are lying idle and nudge them to promote ‘Aatmnirbhar Bharat’ [Self-reliant India] by procuring goods and services from within the country, particularly from MSMEs [micro, small and medium enterprises],” one official said.
The change should be seen in the context of this year’s budget announcement, where the finance minister had put special emphasis on asset monetisation, a second official said. Delivering her budget speech on February 1, finance minister Nirmala Sitharaman said, “A ‘National Monetisation Pipeline’ of potential brownfield infrastructure assets will be launched.”
“CPSEs have idle or underutilised assets. For example, 156 of them have over 4,000 acres of prime land in various parts of the country, which could be made productive assets. Besides, the change will also facilitate government’s disinvestment programme,” said the second official cited above.
The budget on February 1 proposed monetising of land through a Special Purpose Vehicle (SPV) and closure of sick or loss-making CPSEs. The government has budgeted for ₹1.75 lakh crore as receipts from disinvestment in 2021-22.
The change in ministerial control of DPE was effected through a notification issued by the Cabinet Secretariat on July 6. Accordingly, the finance ministry will now have six departments – the department of economic affairs (DEA), the department of revenue (DoR), the department of expenditure (DoE), the department of financial services (DFS), the department of investment and public asset management (Dipam), and the DPE. The ministry of heavy industries and public enterprises is now renamed as the ministry of heavy industries (MHI).
The ministerial restructuring was, however, made public on Wednesday, hours before a cabinet expansion. The gazette notification said that the changes “shall come into force at once.”
According to the notification, DPE will coordinate matters of general policy affecting all public sector enterprises (PSEs), evaluate and monitor their performances, and review their capital expenditure plans. It will also undertake the “residual work relating to erstwhile Bureau of Public Enterprises [BPE] including Industrial Management Pool [of talented managers],” the notification said.
Other functions of DPE include counselling, training and rehabilitation of employees in CPSEs under voluntary retirement scheme, rendering advice relating to revival, restructuring or closure of a state-run firm and conferring them ‘Ratna’ status.
The MHI will continue to administer the capital goods industries. As per the notification, 44 CPSEs and industrial sectors are listed under it. They include Heavy Engineering Corporation Ltd, Bharat Heavy Electricals Ltd, HMT Ltd, Scooters India Ltd, Cement Corporation of India Ltd, Hindustan Newsprint Ltd, Bharat Bhari Udyog Nigam, the manufacture of heavy engineering equipment, machinery industries, and auto industries.
