Division of Public Sector Enterprises (PSEs)
The division of the PSEs of the existing state of Andhra Pradesh
will be done according to the location of production facilities
With the exception of a few PSEs, the headquarters of most of
them are located in Hyderabad. However, it is the location of
the production facility that will determine whether an enterprise
will be included in new Andhra Pradesh or Telangana. The
headquarters may continue to remain in Hyderabad for the
period in which it will serve as the common capital. After this,
enterprises that are allocated to the new Andhra Pradesh would
have to reallocate their headquarters to the new capital city. If
these enterprises are contributing significantly to state revenues,
new Andhra Pradesh may relocate their headquarters at the
earliest to a location within new Andhra Pradesh.
Division of government employees
In relation to the Indian Administrative Services, Indian Police
Services and Indian Forest Services, two separate cadres will
be created: one for new Andhra Pradesh and the other for
Telangana. From the day of bifurcation, the employees of
public sector undertakings, corporations and other autonomous
bodies will continue to function in such undertaking, corporation
or autonomous bodies for one year. During this period, the
concerned corporate body will have to determine the modalities
for distributing the personnel between the two new States.
The Public Service Commission for the existing state of Andhra
Pradesh will also become the Public Service Commission for the
new Andhra Pradesh. Furthermore, it will serve as the Public
Service Commission for Telangana until the new Public Service
Commission is constituted there.
Division of pensioners
The Reorganization Act has made detailed provisions for the
division of pension liabilities of the existing state between the two
new States. This has been elucidated on in the Act. The focus on
pension comes from the experience of the division of other states
that have indicated unresolved issues pertaining to the division of
pension liabilities.
The provision states that the pension liabilities of the existing state will be divided between the two new States in the population ratio. The actual liabilities would differ from this ratio. In such acase, the state that has to pay more than its share in population would be reimbursed by the other one.
State Undertakings & Institutions
Section 68 catalogues eighty-nine (89) State Undertakings have been specified in the Ninth Schedule of the Act. Section 53 of Andhra Pradesh Reorganisation Act that deals with the apportionment of assets and liabilities relating to the State undertakings is as follows:
(1 The assets and liabilities relating to any commercial or industrial undertaking of the existing State of Andhra Pradesh, where such undertaking or part thereof is exclusively located in, or its operations are confined to, a local area, shall pass to the State in which that area is included on the appointed day, irrespective of the location of its headquarters.
(2 Provided that where the operation of such undertaking becomes interState by virtue of the provisions of Part II, the assets and liabilities of––
(a) the operational units of the undertaking shall be apportioned between the two successor States on location basis;and (b) the headquarters of such undertaking shall be apportioned between the two successor States on the basis of population ratio.
- Though eighty-nine state undertakings were included in the Ninth Schedule, only seventy are incorporated societies or companies, rest being subsidiary entities. The previous central government has not paid adequate attention to the principles and the methodology for reorganisation of state enterprises and apportionment of assets and liabilities between the two states while formulating the Act. Though subsequently the undivided Andhra Pradesh government has constituted an expert committee for apportionment of assets and liabilities of the state undertakings, including the staff, it is far from completing its task. This has created uncertainty in the management of the state undertakings during the interregnum.
- The Section 75 of the Act, cited below, has provided for the continuation of facilities in one hundred seven (107) institutions specified in the Tenth Schedule to the Act.
- A careful analysis of the institutions listed in the Schedule-X indicate that twenty-two are government departments, ten are statutory bodies, seventeen are societies and two are categorised as board / council. All these fifty-five entities are required by both States in their entirety and not amenable to sharing between the two States. Further, four of the hundred seven institutions are not functional, nine are universities and sixteen others are integral part of government departments.
- Consequently, the Act has created a curious situation by including the heads of departments (HOD) and regulatory agencies that are integral to the governance of every State in the Schedule-X, while excluding several other entities that have been established under the central and state statutes. Further, the Act has remained silent on the apportionment of staff, assets, etc., of these institutions between the two States. Above all, since majority of the institutions included in the Tenth Schedule are headquartered inHyderabad, the residuary Andhra Pradesh would take a long time to replicate them. The Act has not provided any provision to replicate these valuable institutions in the residuary State.
- several institutions established under the statute, like the Information Commission, State Election Commission, Lokayuktha, Human Rights Commission, etc., have not found place anywhere in the Act. Therefore, it is crystal clear that the Act was designed without adequate attention to the details
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