PSUs THE HEAVEN OF CORRUPTION

by Pritam Singh

It is well understood that open market economy cannot ensure growth with social justice. Therefore state intervention in developing economies becomes imperative. In order to encourage economic development in those sectors which normally do not attract private investment, the state has to provide social and economic overheads to accelerates econorhic development. In the interest of sectoral development and balanced regional economic growth, the state has to float a number- of companies which are business oriented. For providing expert advice, upgraded technology and for regulatory functions parastatal agencies are also established. Lot of decisional autonomy is granted to the public sector undertakings to insulate them from bureaucratic hassles which often adversely affect the working efficiency. But this is all in the realm of theory. A systematic empirical enquiry shows that investment in the public sector is fetching very poor return on the capital invested. There are about fifty companies in the public sector in the Punjab but the reports of the Comptroller and Auditor General of india year after year show that the accounts of more than 40 companies have been in arrears from one year to 20 years. Autonomy has in no way helped these PSUs

Most of the PSUs are headed or controlled by bureaucrats. There is a nexus between bureaucrats in the governments and those managing the PSUs In order tq curry favour with the politicians these public sector managers also establish nexus with politicians. They by pass the rules and regulations and find ways and means to show efficiency and profitability on paper. Their accounts are audited by the auditors appointed by these public managers themselves therefore there is lot of cover up. This lack of transparency results in very Jow accountability. A small surveys reveals a very dismal picture.

Punjab Housing Development Board (PUDA) was set up under the Punjab Housing Board Act, 1972 to check unregulated construction. 1972 Act has now been replaced with The Punjab Regional and Town planning Act, 1995 to control unplanned colonisation and massive building in and around cities of the Punjab and along with highways, resulting in slums, uncongenial environments, lack of civic amenities and encroachment on public lands and congested highways. 1995 Act also provides for the constitution of a State Urban planning and Development Authority (SUPDA) for undertaking development of urban areas, housing programmes and schemes of establishment of newtowns. These are very laudable objectives. Thus PUDA has taken over the functions of PHDB. But strangely enough Punjab Housing Development Board and now its successor PUDA is engaged in the activity which is quite contrary to what it was created for.

In view of the acute shortage of houses for ministers and senior officers of the Punjab Goverment a project costing Rs 20 crores was approved for construction of 46 houses. The construction of these houses in Sector 39, of Chandigarh was undertaken by the pHDB though according to the provision of the P.W.D. code, all construction works of the government departments are to be entrusted only to the P.W.D. for execution, except in cases where the works are assigned to other agencies specifically by the Governor, Financial rules also require that construction works, the estimated cost of which exceeds Rs. 10,000 should not be entrusted by the departments for execution to outside firms or contractors other than the PWD without obtaining the advice of the former. In the audit conducted by C.A.G. (Works) serious objections were pointed out regarding undue financial favour shown to the contractors. The audit report further pointed out serious defects in the execution of the works. "There were leakages, seepages and dampness in all the houses".

Again in violation of the provisions of the PWD code PUDA constructed government houses in Sector 42 of Chandigarh.

The Punjab Water Supply and Sewerage Board was established for executi-on of water supply and sewerage works in the municipal areas. Over the years it has acquired invaluable technical expertise in its special field of activity. But it has no expertise In the execution of building works. But strangely enough Privar Kalyan Bhawan in Sector 34, Chandigarh is being constructed by the Punjab Water Supply & Sewerage Board. Similarly a 25 bed Hospital was also got constructed by Deputy Commissioner, Ropar by the same organisation.

Promotional efforts of the Punjab Government for the Industrial sector are mainly channeled through Punjab State Industrial Development Corporation Ltd. (PSIDC). The CAG of lndia in his Annual Report for the year 1987-88 observed "in the field of promotion of industrial units, the Company's performance was poor." Since this report there is not such improvement in the performance of PSIDC. But PSIDC is also engaged in execution of government buildings. Punjab State Institute of public Ad ministration's building project costing Rs. 20 Crores is being constructed by PSIDC. Under the rules the drawings and designs of all government buildings are required to be prepared by the Chief .Architect, Punjab. But in the instant case a private architect has been engaged at the rate of 3.5 % of the total cost of the project. Directorate of Technical Education building has also been constructed by PSIDC. This shows that PSIDC is deviating in its activity for which it was created.

MARKFED is an apex co- operative organisation. lts major function is to ensure remunerative prices to the agriculturist and also to arrange essential inputs to the farming sector. But this organisation is also engaged in construction activity of government works. The Govt. polytechnics at Ropar and Ferozepur have been got constructed by MARKFED.

These are few instances of serious aberrations in the working of the public sector. But a thorough enquiry can reveal the rot with which it is reeking at the moment. The Finance Minister, Punjab in his budget speech for the year 1997-98 announced the intention to establish Golden Adarsh State. He further announced that, "Our , government is committed to eradicate corruption and introduce austerity in public life." lt is hoped that he would take steps to honour his commitment and cleanse the public Sector.