GM Friend,
Public Sector Undertaking Meaning -PSUs Any industrial, commercial or Conomic - activity carried on by the Central Government or by a State Government or jointly by the Central Government and the State Governments with a selfcontained management out side the Government may be called a public sector undertaking or public sector enterprise.
Types Of Public Sector Undertaking
They are
(1) Central Government enterprises such as SAIL, State Bank of India etc. State Government undertakings like Electricity Boards, State Transport Corpora tions and
(ii) Enteriprises under joint ownership and managements of Central and State Governments, eg.
- Damodar Valley Corpora tion,
- Bakra Nangal Project.
Even joint sector enterprises which are controlled by the Govern ment may be considered as public under- takings.
Another classification of public enterprises may be made as follows:
- (1) Public utilities like water, gas, electricity etc.
- (ii) Transport and communication like railways, airlines, shipping, posts, telegraph, broadcasting etc.
- (iii) Banking and insurance like Reserve Bank of India, Life Insurance Corporation.
- (iv) Multi- purpose Projects.
- (v) Industries, including min- ing and minerals, e.g. Coal India Ltd., ONGC, HMT.
- (vi) Trading concerns like State Trading - Corporations.
- (vii) Cultural enterprises like Films Division, Film Corporation of India.
This is especially true when the Govern ment is committed to socialism with the basicval of providing various social services to the wople Since India does not have huge capital in the private sector, the Government has to take steps to invest on basic and heavy industries, in particular, in infrastructural cilities Gil A modern government is inter ested in getting as much funds for its activities as possible Industry and commerce are major sources of income for any institution in the modern world.
So it is natural for the Government to take up such activities.
Growth, Functioning, Performance and Problems: These aspects are treated elabora- tely in Indian Economy and Geography Part.
Parliamentary Control Of Public Sector Undertaking Example
Since the Parlia ment is the custodian of public finances and represents the ultimate share-holders, i.e. the tax-payers, a public undertaking-depart- mental concern or government company or public corporation-has to be accountable to the Parliament.
There are several ways in which the Parliament exercises control over- public undertakings of the Central Govern- ment. Some of them are:
(i) Parliamentary questions, (ii) Adjournment motion,
(iii) Parlia mentary debate about any enterprise,
(iv) Bud- get debate
(v) Debate on Bills and Resolutions relating to public undertakings
(vi) Discussion on annual and periodical reports, including Committee reports and reports of C.&.A.G.,
(vii) Parliamentary Committees, i.e. Public Accounts Committee, Estimates Committee and Committee on Public Undertakings, (viii) Debates on report of Inquiry Commissions on Undertakings.
In spite of such opportunities available to the Parliament, it is expected that the day-to-day administration and details of administration of a public undertaking should be outside the purview of Parliamentary
Control Of Public Undertaking Sector
Ministerial Control:
The Minister in charge of the public undertaking concerned is expected to have substantial control over the organisation.
In effect, the Minister may exercise powers more than the power exercised by the share-holders of a private commercial con cern.
However, each public undertaking the is expected to have a controlling body-Board of Directors or otherwise outside government.
While government officials may be the members of such boards, the boards are expected to function independently, not under the immediate directions of their depart ment.
The Minister or the government department concerned should not be directing the day-to day affairs of the public undertaking; nor should they be making decisions in the place of the Managers controlling the public undertakings.
There are several ways in which a Minister exercises control over a public corporation.
He is responsible for the appoint- ment of members of the Governing Board and the General Manager and decides on their service conditions.
He may issue general policy directions on matters including capital investment, personnel policies and other matters affecting national interest.
He may also issue specific directions to the Manage- ment. He may have to approve certain cate- gories of actions and policies.
Finally he may call for information and for periodical reports from the public undertakings. In all these aspects, the jurisdiction of the Parlia- ment should be co-extensive with that of the Minister concerned.
Public Sector Undertaking
Public Undertakings Committee:
This Committee was set up in 1963 after a debate in the Parliament.
It consists of 15 members- $ 10 from the House of the People and 5 from the Council of States. The members are elected f according to the principle of proportional 1 representation by means of the single transferrable vote.
The Committee is expected to examine reports and accounts of the enume- rated public undertakings of the Central Government, such as Indian Airlines, Air India, LIC, BEL, Mazagaon Docks and many other government companies.
The Committee may examine whether the undertakings are managed according to sound business principles.
It may also examine the reports of C&A.G. However, there are many limitations placed on the discussions in the Committee.
Autonomy:
In the context of the govern ment's control over the public enterprises, the issue of autonomy has been frequently debated.
Since many public enterprises are running at a loss, it has been pointed out that it is desirable to reorganise and change the working of several public secter undertakings so that they can become profitable concerns.
It is argued that investing the managements of public enterprises with autonomy or much more powers in decision-making will help in running these concerns along sound commer cial lines.
It is also argued that the latest management techniques may be profitably employed in improving the performance of public sector undertakings.
However, it is clear the ultimate control of the Parliament and the Ministry cannot be compromised There can be improvement in two important respects.
Firstly, the government may pay more attention to filling up the top managerial posts expeditiously and using objective criteria.
Secondly, the Government and the Minister may desist from interfering in the day-to-day working of the concerns.
Conclusion :-
It is also argued that the latest management techniques may be profitably employed in improving the performance of public sector undertakings.