The reform proposal, seeking statutory powers to the public enterprises selection board (PESB) is under serious consideration by the government, says Rajiv Rai, secretary at the board. The PESB functions as the selection body for appointing PSU executives

To restrict the role of political executive in the appointment of top-level executives in central public sector enterprises (CPSEs), PESB had last year sent a proposal seeking statutory powers to the board. The department of personnel and training gave final shape to the proposal and the department of public enterprises also supported it. 

“It involves several processes before it becomes the bill. Opinions of other ministries are also being considered on this matter and simultaneously our views are also taken. Out of the many policy reviews undertaken by the new government, they are pleased with the changes proposed in the structure of PESB. Nothing has happened in terms of notification though,” Rai told Governance Now.

Though Rai did not agree on any political intervention during the selection process of the CPSE executives, he pointed out on the need to give PESB a more robust status. He said that the appointment of CMDs and other executives at CPSEs is done by the board in a very fair and objective manner and generally their recommendations are accepted.

“We have our own process of calling for appointments and selecting the final candidates. The proposal is just to further strengthen the process of selection,” he said.

While it identifies executives for filling vacancies, conducts interviews and finalises suitable candidates, the process is completed only after the name is approved by the administrative ministry and a final clearance is taken from the appointments committee of cabinet (ACC) headed by the prime minister. And most delays in filling of vacancies takes place at the stage of getting the approval of the administrative ministry and the minister. The proposal seeks for a change where PSEB's decisions on such appointments are final without any need for formal approval from the administrative ministry.

“Though just bringing a statutory status won’t bring much difference in the functioning and the structure of the board. The idea is to bring in reforms and to further strengthen the board. UPSC is a constitutional body. Still, at times the recommendations made by them are rejected by the government.”