Drawing lessons from the observations of the Comptroller and Auditor General (CAG), Finance Department of Maharashtra Government has ‘reminded’ the public sector undertakings (PSUs) and corporations in the State to ‘operate in the framework of rules’. Interestingly, the CAG had made certain observations regarding the operations of PSUs in its report on functioning of Maharashtra Airport Development Company (MADC) and its project Multimodal International Airport and Hub at Nagpur (MIHAN). The CAG report had recorded some observations based on review of the functioning of MADC and its MIHAN project for the period 2008 and 2012.

 

However, according to sources, despite the Finance Department asking the PSUs and corporations about taking ample care to follow the rules and directions issued from time to time, some issues had come to the notice of the department. Though the sources did not reveal the specific issues, they said that the Finance Department has reminded the PSUs and corporations to ‘operate in the framework of rules’ and provisions under Memorandum and Articles of Association, Company Act of 1956 and 2013, Public Works Department’s rule book, Manual of Office Procedure for Purchase of Stores by the Government Department (1978) issued by Industries, Energy, and Labour Department. Besides, the PSUs and corporations have been asked to stick to the directions issued by Environment Department, Revenue Department, and also circulars and Government Resolutions issued by Finance Department on various occasions since 1992. The latest ‘reminder’ issued a few days ago by Manoj Saunik, Additional Chief Secretary (Finance), also mentions that the Managing Director/Chief Executive Officer of the respective PSU, corporation, board, or company shall be responsible for ensuring that rules are followed properly. Maharashtra Government has several PSUs, corporations, boards, and companies.

 

The PSUs in particular receive share capital, grant-in-aid, loan, guarantee etc as part of investment of State Government. However, different PSUs and corporations and boards and companies have been formed under different rules. There is variance in their objectives, area of operation, organisational structure, financial models, profit-making potential etc. Despite this, Finance Deparment has pointed out the need for having some kind of uniformity and same larger framework of rules for them. Hence, it has issued the latest ‘reminder’ to these bodies.