Karnataka shuts down Dept of Public Enterprises

The Karnataka government has issued an order repealing the Department of Public Enterprises (DPE) as part of an ongoing attempt to rationalise expenditure and shed administrative weight.

The decision to shut down the DPE is based on a recommendation by a Cabinet sub-committee that was constituted to suggest merging or repealing departments, offices and posts.

All matters that were handled by the DPE will be given to the Finance Department, according to the government order. The other option before the government was to merge DPE with the Infrastructure Development Department, sources said.

The DPE had jurisdiction over 60 public sector undertakings in Karnataka such as the Mysore Sales International Ltd and Karnataka Soaps and Detergents Ltd.

Of the 60 PSUs, 34 are profit-making and 21 are under losses. Five are social sector enterprises that are not measured in terms of earnings or gains.

In 1980, the government set up the Karnataka State Bureau of Public Enterprises (KSBPE). In 2002, this was converted and renamed as the Department of Disinvestment and Public Enterprise Reforms (DDPER) under the Department of Personnel & Administrative Reforms. In 2005, the DDPER was converted into a full-fledged, independent DPE with a secretariat.

Over the years, the DPE became a white elephant and its work was confined to providing training, conducting the annual Chief Minister’s Ratna Award for the best-performing PSUs and evaluating the functioning of the state-run companies.