A K Bhattacharya: My ministry, my chief

RAISINA HILL

The attempt to remove favouritism in PSU appointments has failed.

One of the areas where the Manmohan Singh government had promised to bring in reforms was the public sector. And indeed work on this had begun rather well. Sensing that many problems in public sector have their genesis in the way a particular undertaking's chief executive was appointed, the Prime Minister's Office (PMO) under Manmohan Singh had decreed that all recommendations for appointment of chief executives by the Public Enterprises Selection Board (PESB) should have only one name. The Appointments Committee of the Cabinet (ACC), that includes the prime minister, the home minister and the Cabinet minister in charge of the ministry under whose administrative control the PSU concerned functions, should either agree to this name or send the recommendation back for PESB to identify and send a fresh name.

Earlier, PESB would send a panel of three names. And that would be the start of all politicking and lobbying. This system, in vogue for years, suited almost everyone. PESB could follow the norms of recommending the best candidate for a job and keep his or her name at the top of the panel. And when political pressures and lobbying for some other candidates increased, it would allow such names to be inserted at number two or three in the panel. This meant the ACC could take the final call. If political pressures were too strong, the second or the third candidate on the panel got the nod. And when no politician had any candidate or no bureaucrat was interested in a certain post, PESB's candidate, who usually topped the panel, got the job.

But this major reform got stuck even before it could be implemented. The idea met with stiff resistance from ministers, who soon realised how difficult it would become to get their candidates in if the system of PESB recommending only one name was enforced. First, the ACC (or more appropriately, the ministers) had to produce or invent a really strong reason to reject the candidature of the person selected by PESB. And second, even if one found a good reason to reject the candidate, sufficient time was lost and there was no assurance that their preferred candidate would be on the panel the next time.

So, what was the compromise? The government settled for the "middle path". Instead of three names, PESB was advised to send in two shortlisted names of candidates for appointment of PSU chiefs and directors. As a result, the whole purpose of the reform move was defeated. Thus, when PESB sends in its recommendations for succeeding Subir Raha, whose tenure as the chairman and managing director of ONGC came to an end last week, there will be two names, not one, as originally planned. And Murli Deora (the minister for petroleum and natural gas) can make sure that the candidate he wants to be the next ONGC chief is one of the two names PESB sends in.

This brings us to the point on why the government took so long in making up its mind on not extending Raha's tenure as ONGC chief. There are many stories explaining the last minute decision, which in themselves are a sad comment on the shabby manner in which the government continues to deal with PSUs. One such story suggests that both Deora and the petroleum secretary had actually cleared Raha's extension for three months but the PMO shot that down on advice it received from various quarters. Whatever be the reason, there was no reason why a decision on who should head ONGC should be taken at the last minute.

Perhaps, the manner in which the finance ministry is moving on appointing SBI chief, A K Purwar's successor, should serve as an example. The exercise to identify the right candidate to take charge from Purwar had begun weeks ago. A final shortlist has been made for the ACC to clear the name, well before Purwar's last day in office. Not a day will pass when SBI will be without a full-fledged chief executive at the helm with a clear tenure. Recently, Sunil Arora waited till the last day of his tenure before learning that he will not be given an extension as the chief executive of Indian Airlines. Several months went by before a successor with a full tenure was identified and appointed. The same fate awaits ONGC. And this is no good news for PSUs in a government that is supported by the Left which swears by a stronger and a more autonomous public sector.