Sarat Chandra IAS Academy

Department of Public Enterprises

  1. Department of Public Enterprises

#GS2 #Government policies and intervention

Context: Recently, the Government has integrated the Department of Public Enterprises (DPE) with the Finance Ministry from the ministry of Heavy industries.

About the Move:

  • Finance Minister Nirmala Sitharaman had announced about this change in her budget speech 2021-2022.
  • It has been brought under finance minister in a bid to ease coordination regarding future disinvestment plans.
  • The Finance Ministry will now have six departments while DPE’s parent ministry.
  • This also gives it a better control over key state-owned firms, review their capital expenditure plans and chalk out measures relating to revival as well as closure of CPSEs
  • Finance ministry already has a department dealing with Central Public Sector Enterprises (CPSE). So, inclusion of DPE would result into better coordination on issues like disinvestment.
  • The move comes ahead of the significant privatisation roadmap being pursued by the government, including strategic sale of Bharat Petroleum Corporation Ltd (BPCL), Shipping Corporation, Container Corporation, Neelachal Ispat Nigam Ltd, Pawan Hans, and Air India, which are expected to be completed in 2021-22.
  • Key government companies like BPCL, ONGC, IOC, HPCL, Power Grid Corporation, Coal India, among others, will now come under direct control of Finance Ministry.

About Department of Public Enterprises:

  • In their 52nd Report, the Estimates Committee of 3rd Lok Sabha (1962-67) stressed the need for setting up a centralized coordinating unit, which could also make continuous appraisal of the performance of public enterprises.
  • This led to the setting up of the Bureau of Public Enterprises (BPE) in 1965 in the Ministry of Finance.
  • In 1985, BPE was made part of Ministry of Industry.
  • It is the nodal department for all the Central Public Sector Enterprises (CPSEs).
  • DPE’s present functions includes, among others, review of capital projects and expenditure in CPSEs and measures aimed at improving their performance and capacity building.
  • It lays down, in particular, policy guidelines on performance improvement and evaluation, autonomy and financial delegation and personnel management in CPSEs.
  • It furthermore collects and maintains information in the form of a Public Enterprises Survey on several areas in respect of CPSEs.
  • Department of Public Enterprises is headed by Secretary to the Government of India.

Major Functions of DPE:

  • Coordination of matters of general policy affecting Public Sector Enterprises (PSEs).
  • Restructuring of PSEs including the mechanisms or closure’s when needed.
  • Giving out advice relating to revival.
  • Counselling, training and rehabilitation of employees in CPSEs under Voluntary Retirement Scheme.
  • Categorisation of CPSEs including conferring ‘Ratna’ status.
    • CPSEs are classified into 3 categories- Maharatna, Navratna and Miniratna. Presently, there are 10 Maharatna, 14 Navratna and 74 Miniratna CPSEs.

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