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Home--News
Delhi Government Broke Rules for Privatization
Sujay Mehdudia
The Hindu
September 22, 2005
NEW DELHI: In a severe indictment of the Delhi Government led by Chief
Minister Sheila Dikshit over the whole process of privatisation of
the power distribution network in the Capital, the Public Accounts
Committee of the Delhi Legislative Assembly has accused the powers
that be of bending all rules and colluding with business houses to
"accrue monetary benefits'' to them.
It has alleged possible involvement of one or more members of the
Core Committee set up by the Delhi Government for power privatisation
in favouring the conditional bidders for "monetary consideration''
by effecting major modifications in the transfer scheme.
The report carries a highly damaging indictment of the Delhi Government,
its Power Department, and senior bureaucrats who handled the whole
process of privatisation three years ago. Sheila Dikshit loyalists
did not allow the report to be adopted at the PAC meeting on Tuesday.
The PAC, headed by ruling Congress Party MLA S. C. Vats, has recommended
that the Government now approach the Central Bureau of Investigation
(CBI) for an enquiry to ascertain the circumstances that led the members
of the Core Committee to go against the interest of the public exchequer
in favouring the conditional bidders. .
"The PAC is of the opinion that members of the Core Committee bent
all rules and, in blatant violation of the Request for Proposal (RFP)
clauses 19.5 and 19.8, colluded with the business houses who were
bidding for the power distribution business, and at their behest made
drastic changes in the transfer scheme so as to accrue monetary benefits
to the conditional bidders in the long run. The members of the Core
Committee also attempted to undermine the authority of the competent
authority (Lieutenant-Governor of Delhi) by seeking a doctored legal
opinion from the Law Department of the Delhi Government so as to alter
the definition of `Government','' the report says.
The report notes that the same Core Committee prior to fixing this
deal had opined to the Cabinet that bids being conditional in nature
"may not be accepted in their present form". And by saying that bids
may not be accepted in their present form, the members of the Committee
wanted to retain the handle with themselves and leave enough scope
for them to "manipulate'' things, it adds. In its most damaging portion,
the PAC states: "In this background, it is felt that all was not above
board and it does not rule out the involvement of one or more members
of the Core Committee in favouring the conditional bidders for monetary
considerations by accepting conditional bids and effecting major modifications
in the transfer scheme, policy directions and contract agreements
without the approval of the competent authority.''
According to the PAC report, the Core Committee agreed to all major
concessions sought by the bidders and instead of addressing the concerns
of the Government and the Capital's power consumers, it seemed more
concerned about the bidders' interests. "`The PAC is of the firm view
that had the revised conditions and liberal concessions been made
public at the time of issue of bids, more bidders would have entered
the fray and enabled the Government to strike a better deal in favour
of the consumers.''
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