Andhra cancels GO on PSU reforms

The Andhra Pradesh government today scrapped the GO No 5 pertaining to reforms in about 30 public sector enterprises on account of widespread apprehensions over the possible retrenchment of employees.

Earlier, the government kept the GO, which was issued last month, in abeyance in the face of pressure from the Left and opposition parties as well as employees' organisations to completely withdraw the order.

Announcing the decision, state finance minister K Rosaiah said the government had decided to cancel the GO considering the fears expressed by the public sector employees over their future and political parties, though the government had never intended to resort to retrenchment.

While the state cabinet last month had approved the third phase reform programme in public enterprises spanning a period of three years starting from 2006, the subsequent orders issued in the same month had touched the sensitive issue of removal of employees in organisations like the Andhra Pradesh State Road Transport Corporation (APSRTC) leading to a hue and cry from the Left and Telugu Desam Party.

The issue became a matter of embarrassment for the government as the Left parties alleged that the order was issued to please the World Bank.

Replying to queries, Rosaiah, however, clarified that the reform process would continue even after scrapping of the controversial order.

"Reforms in the state public enterprises were initiated long back and they are in no way linked to the GO. So the question of the reform process getting derailed does not arise. By cancelling the order, we only wanted to reinforce the confidence of employees in the government, which never intended to do any harm," the minister told the media.

Meanwhile, the finance department denied having given its concurrence to the GO as claimed by the public enterprises department, raising further questions about the manner in which the order was issued. The finance department circulated a note saying that the claim made by the PE reforms wing was inappropriate.

Sources in the government said the government had never intended any retrenchment in organisations like APSRTC, which are running short of technical personnel, though the GO wrongly mentioned the need for pruning the staff based on an action plan prepared 10 years back during the previous government.

"The government may at best redeploy the workforce or offer voluntary retirement option but never thought of removing them from their jobs," a finance department official pointed out.

Chief minister Y S Rajasekhara Reddy, who held a review meeting on the GO before deciding to scrap the order, is learnt to have taken the PE reforms officials to task for the volte face forced on the government.