The Hindu : Karnataka News : ESCOMs seen as white elephants

Online edition of India's National Newspaper
Wednesday, Aug 18, 2004

Karnataka

Karnataka

ESCOMs seen as white elephants

By T.S. Ranganna

BANGALORE, AUG. 17. Encouraged by the State Cabinet approving the establishment of the Chamundeshwari Electricity Supply Company to cater for consumers of Mysore and neighbouring districts, political leaders in Davangere have demanded the establishment of a similar company for Davangere and surrounding districts.

According to sources, the demand is likely to be conceded. With the introduction of power sector reforms, four electricity supply companies (ESCOMs) were set up with headquarters in Bangalore (BESCOM), Mangalore (MESCOM, which now covers Mysore district), Gulbarga (GESCOM) and Hubli (HESCOM).

Drain on finances

But experts in the field consider the ESCOMs as white elephants and a drain on finances. Just two years ago, the only organisations dealing with power were Karnataka Power Corporation Ltd. (KPCL) and Karnataka Power Transmission Corporation Ltd. (formerly Karnataka Electricity Board). Under pressure from the Union Government since 1992 for carrying out reforms in the power sector, the State Government established the four ESCOMs. The erstwhile KEB functioned with one chairman and seven directors. The new companies have created posts for the State's large pool of IAS officers. About half a dozen of them are now working in KPTCL, BESCOM, GESCOM, HESCOM and MESCOM.

Top heavy

In addition, there are 26 chief engineers and an equal number of controllers of accounts working in the companies. The Government, sources say, is going to approve the decision of the KPTCL to appoint a controller of accounts (CA) for its planning and monitoring cell, which, the experts say, is unheard of in any other State. The senior-most deputy controller of accounts is likely to be made controller of accounts shortly. The controllers are being placed above the executive engineers, who are at least ten years senior to them in service.

According to a trade union leader, the controllers of accounts have become a parallel power centre in the organisation and are reportedly working against the technical staff, who were till now the backbone of the electricity undertakings.

The Janata Dal (Secular), which is sharing power with the Congress in the coalition Government in the State, has assured the people that it will cut down unnecessary expenditure. The Deputy Chief Minister, Siddaramaiah, who holds the Finance portfolio, echoed the party's objective in his budget speech and declared that he would give top priority to "right-sizing" the civil service. "High costs of public service delivery are a premium on the poor. My effort will be to fashion responsive and responsible governance," he said.

"Right-sizing the bureaucracy will be [given] top priority. Functional reviews of all departments will be completed and redeployment and voluntary retirement scheme operationalised. Recruitment freeze will continue. In tandem with compression of the number of Ministries, a reverse merger of departments will be implemented. A contributory pension scheme operated through an investible fund will be introduced on the Government of India pattern. The recommendations of the committee constituted by the Reserve Bank of India on pension reforms will be fully implemented," he said in his budget speech.

`Unwanted expenditure'

The trade union leader, who has been associated with the reform process in KPTCL, said the creation of the four ESCOMs had only increased unnecessary expenditure and, except for BESCOM, the performance of the others were not up to the mark, and some were making losses.

`Merge ESCOMs'

According to an IAS officer who had served in one of the organisations, the State Government should follow the Tamil Nadu pattern and have one organisation each for generation, trading and distribution or power. All the ESCOMs should be merged into one. Otherwise, consumers and taxpayers, who are already paying for subsidies, transmission and distribution losses and power theft, will be further burdened.

Technocrat chairmen of KEB such as V.N. Kalgal, P.V. Ramaiah, B.G. Rudrappa, P. Narasimha Murthy and Visvesvaraya, who started their service as assistant engineers, did very well since they rose from the grassroots, he said.

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