Fund to help restructure SEBs

New Delhi, May 6 (UNI) To make states help restructure their electricity boards, the Government is planning to set up a fund that will have fiscal contributions from both the Centre and states.

The fund, called Power Sector Reform Fund (PSRF), will help boost the reform process at the state level, Ministry sources said.

Also, the PSRF would help in providing consultancy support to new companies for institutional strengthening, capacity building and exceptional assistance to meet situations arising out of natural calamities.

The fund is also an outcome of a study conducted by the Indian Institute of Public Administration (IIPA) for restructuring of State Electricity Boards (SEBs). Also, the Expert Committee on State-Specific Reforms headed by Deepak Parekh in 2002 recommended setting up a power sector reform fund.

The IIPA has suggested that 50 per cent of the funds should be contributed by the Centre.

The Orissa Regulatory Commission had recommended the setting up of such a fund.

The Parekh committee had suggested that all existing liabilities of the sector should be transferred to the PSRF and the responsibility for servicing these liabilities would remain with the state government.

SEBs are facing a perpetual financial crunch and an expert group headed by Montek Singh Ahluwalia has suggested 'a one time settlement' along with 'a commitment to initiate the process of reforms'.

UNI