4.13-Ministries And Departments

• In India, as in Great Britain, reorganization of ministries and department is an executive prerogative. There is hardly any parliamentary control over such reorganizations, except through a normal channel of control like that of the budget.
• Conversely, in the United States, such pragmatism and flexibility are lacking. Therefore the creation of a new department or 
• for the transfer of a subject from one department to another, specific legislative sanction is required, which is always difficult to obtain.

Ministry of Home Affairs

• Most Significant and influential
• Home department-one of the oldest dept.
• Home dpt.-result of reorganization of EIC 1843-when the Secretariat of supreme government was separated from that of the government of Bengal.
• The department then encompassed an exhaustive list of functions not related to other departments .viz-military, finance and foreign affairs.
• New subjects kept on being added to its substantially broad jurisdiction and a few were taken away from it from time to time.
• The number of subjects dealt with by the department then was not static.
• March 1964-new department of Administrative reforms –in the Home min.
• 1970-personnel and civil services taken away from the ministry of home and transferred to the Department of Personnel created in the same year.
• It continued to function as part of home ministry but in 1985 it was put under the newly created Ministry of Personnel, Public Grievances and Pensions.
• In 1973 the department of administrative reforms was merged with the Department of personnel which was located in the cabinet secretariat.
• In 1977 with the formation of the Janta government at the centre both these departments were shifted back to the home ministry
• This arrangement continued till January 1985 when the Department of Personnel and Administrative Reforms was separated from it and put under a different ministry-Ministry of Personnel, Public Grievances and Pensions.
• In September 1985, the subjects related to scheduled caste and scheduled tribes were taken from Ministry of home and made part of Ministry of welfare.
• Later in 1994, a new department , Department of Jammu and Kashmir Affairs, was created. It deals with the constitutional provisions and other matters related to the state of Jammu and Kashmir. The latest addition is the department of Border Management that was created in 2004.Thus, from the beginning of 2012,the ministry of Home affairs has six departments -

1. Department of official language, 
2. Department of J&K Affairs and
3. Department of Border Management,
4. Department of Internal Security,
5. Department of States,
6. Department of Home affairs.

• The Home Ministry is headed by the Home minister who is of cabinet rank.He is in turn is assisted by two ministers of state.The division of functions among the minister and minister of state for Home affairs is decided by the Home minister.there are certain matters which are disposed of at the level of the ministers of state.
• Nevertheless all sensitive issues , particularly those of internal security do reach the Home Ministers level and sometimes even the prime ministers level.The most critical issues are discussed at the level of the Political Affairs Committee of the cabinet and even in the entire cabinet.
• In recent years,with serious threats to internal security and peace visible everywhere, the home ministry's functioning has assumed crucial significance.
• Ironically,the years 1993 and 1994 witnessed intra-ministerial differences at the level of the ministries of state and the home minster. The violation of the principle of unity of command forced a union home secretary to seek premature retirement.
• The administrative head of the ministry is the Home secretary, who is a senior member of the IAS.
• Most of the senior positions in the Home Ministry are manned by members of IAS and IPS. The ministry also had attached and subordinate offices, a reference to which is made at appropriate places in the following section.
• The Home ministry also has a consultative committee of the members of parliament attached to it. It meets under the chairmanship of the home minister to discuss affairs relating to the ministry, but as the name suggests, it has a purely consultative role.
• As mentioned earlier, the work of the ministry is divided into six departments . The functions of each department are discussed briefly below-

DEPARTMENT OF HOME

• Department of home is the nodal department for overall policy making in the Ministry of Home Affairs.
• However,the actual implementation of any individual policy decision is the responsibility of the concerned department.
• The Home Department issues notifications on the assumptions of office,resignation and removal of the President,the vice president, the prime minister, other ministers, parliamentary secretaries, Governor of states ,Lieutenant governors,Chief commissioners and administrative officers in the union territories. 
• It also deals with their personnel problems.Besides ,it is concerned with matters relating to financial emergency,also come within its purview.
• It deals with several other matters like awards and decorations,the national anthem,the national flag,the national emblem,national festivals , official dresses a,linguistic minorities,political and freedom fighters pensions, census of population and important statistics including registration of births and deaths.
• It is the duty of the department to obtain the prior approval of the president on the promulgation of ordinances by the governor of states. 
• It deals with the bills passed by the legislators of states which are reserved by the governors of states.
• It deals with the bills passed by the legislatures of states which are reserved by the governors for the consideration of president and with consultation between the central and the state governments in regard to state legislation,grants of pardons, remissions, suspension or commutation of death sentences and petitions for remission of sentences excluding death sentences are also dealt by it.
• Issues such as citizenship , naturalization,immigration from foreign and common wealth countries, conventions with foreign and commonwealth countries in judicial matters and questions relating to the International Court of Justice are the concern of department.
• Certain other functions of the departments include looking after the central and state lotteries,warrant of precedence, formalities to be observed on the death of high dignitaries and allowances and relief to be provided on compassionate grounds to persons who served the nation in political , social or other fields.

DEPARTMENT OF INTERNAL SECURITY

• The maintenance of overall law and order in the country is the chief responsibility of the Home Ministry.
• The task assumes great significance,since the internal security challenges before the nation become the prime concern of the minsitery. 
• Since the late 1980s,the ministry has been under mounting pressure because of the steady deterioration of law and order in several spheres.there is multiplicity of tensions based on communal and caste cleavages, secessionist and terrorist activities, naxalism, extremist violence,agrarian unrest and religious fundamental movements. Every time the governments limps back to normalcy after a crisis .
•  pressure emanates again from certain unanticipated quarters.
• It may be noted that under the constitution , 'public order' and 'police' are the primary responsibilities of the state governments .
• The ministry of Home Affairs, however acts as the overall in charge and co-coordinating agency on matters relating to internal security.
• It keeps an eye on the developments in the law and order situation along with provides guidance and assistance to the states as and when necessary.
• It remains in constant touch with the state governments and ensures that the administration in the states is carried on in accordance with the provision of the constitution.
• The major task of the departments of internal security relate to public security,police and prisons administration. 
• In this context , it administers and controls various paramilitary forces like Assam rifles, BSF,ITBP,CRPF,CISF(Central Industrial Security Force) and National Security Guard. The Assam Rifles operates chiefly in North-East to counter insurgency. 
• The BSF and Indo-Tibetan Border Police are engaged in policing and protecting the northern border.The Central Reserve Police Force is meant to reinforce the state police force to counter terrorism,while the central industrial Security Force is deployed in the public sector undertakings to perform protective and preventive duties.
• The Home ministry is the cadre controlling authority for the Indian Police Services which had as of 2011 a cadre strength of 4270.
• Accordingly ,the department of Internal security looks after all service matters of the IPS,like training,promotion,pay etc.
• The ministry is also responsible for administering the National Crime Records Bureau,Directorate of Coordination,Bureau of Police research and development,Institute of criminology and forensic Science,central Forensic Science Laboratory and Sardar Vallabhbhai Patel National police Academy.
• The department is concerned with all other important matters of the Police administration such as National Police Commission reports,police reforms, police medals and conferences of IPS officers and maintains close links with they international criminal police organisations(INTERPOL), Since the main burden of enforcing law and order rests on the police,the Home Ministry has been laying increased emphasis on the modernization of the police force.
• Prisons are again state subject .The ministry ,however renders advice and provides financial assistance to the state governments and union territories in bringing about improvements and modernization of prison administration.
• The scheme of "Modernization of prison" was brought under the plan during 1992-93.Yet another notable function of the ministry is civil defense.
•  Civil defense aims at saving lives and minimizing damage to property in times of foreign aggression.With this aim,the ministry provides guidance and training to and effects co-ordination for the fire services and Home guards.
• The Home guards is a voluntary force which assists the civil administration in times of need.
• The Home ministry is also responsible for the implementation of several important Acts such as the erstwhile

1. Terrorist and Disruptive Activities (prevention) Act 1985(TADA); 
2. The terrorist affected areas (Special Courts) Acts 1984,enforcement of official secrets Act,1923.
3. The essential services Maintenance Act 1981,
4.  the Unlawful Activities (Prevention)Act 1967,
5. the Arms, Fire Arms,Ammunition and the Explosive substances Act 1908,
6.  and the criminal law of the land.

• It keeps a watch over all foreigners in India,deportation of foreign nationals from India and reparation to Pakistan of released Pakistani soldiers.
• Lastly, the rehabilitation Division of Home Department is responsible for the formulation of programmes and schemes of the Home department is responsible for the formulation of programmes and schemes for relief and rehabilitation of displaced persons from Pakistan,PoK,repatriates from Burma,Srilanka and Uganda and refugees from Tibet and Pakistani nationals who had entered Rajasthan and Gujarat during the Indo-Pak Conflict of 1971.
• One such relief and rehabilitation scheme is the Dandkaryanaya Project. 
• It was set up in 1958 for the resettlement of displaced persons from the former East Pakistan fro the resettlement of displaced persons from the former East Pakistan and for the integrated development of the Tribal population of the area.

DEPARTMENT OF STATES

• The Department of states of the home ministry is primarily entrusted with the task of maintaining centre-state relations and centre union territories relations.
• It looks after the establishment and formation of new states and alteration of states , boundariesm and names of existing states and union territories and alteration of areas,boundaries and names of the existing states and union territories and all matters concerned with the rulers of former Indian states.
• It manages the functioning of the Inter-state council set up in May 1990 on the recommendations of the Sarkaria Commission. 
• The council comprises the PM as the chairman, Chief Ministers of all states and union territories with legislatures , administrators of the union territories with legislatures and six Union cabinet Ministers including Home minister, nominated by the PM as its members. 
• The council is a re-commendatory body.It examines , discusses and deliberates on issues relating to centre-state and centre-UT relations.
• The Department of states is responsible for the functioning of inquiry commissions set up to investigate various cases in the states and implementation of accords signed with the states. 
• Committees may also be formed to search for viable solutions to problems confronting various states.The ministry also keeps close liaison with the state governments and gives them directions, whenever necessary , for promoting communal harmony and national integration.For this purpose , the national Integration Council need to be held more often.
• The Second ARC has recommended that the meetings of ISC should be organised more frequently.
• In 2010 The commission on centre state relations under the chairmanship of Justice MM punchii, had recommended that the council should have a permanent secretariat and its meetings should be held more frequently.
• The Department of states also supervises the extension of union laws to the union territories and in respect of few UTs , it looks after affairs such as police, prisons, reformatories,public order and questions relating to public services.
• Lastly,the department supervises are in the field of water supply, power, industries, agriculture, fisheries, education,health, social welfare, rural development, tourism and transport.

DEPARTMENT OF OFFICIAL LANGUAGE

• The department of Official language deals with all matters concerning the central translation bureau, the kendriya Hindi samiti and the Hindi salahkar samitis set up by the various ministries and departments .
• It is responsible for the constitution and cadre management of the central secretariat Official Language Service.
• It implements the provision of the constitution concerning the official language and the official languages Act 1963 and obtains the prior approval of the President of India for authorizing the limited use of languages other than English in the proceedings at the High Court of a state.
• Besides it has the nodal responsibility for all matters concerning the regular and gradual use of Hindi as the Official languages of the union.
• Lastly,it coordinates all matters relating to the progressive use of Hindi as the official language of India.

DEPARTMENT OF JAMMU AND KASHMIR AFFAIRS

• Created in November ,1994 this department deals with constitutional provisions (including Article 370) in respect of the state of Jammu and Kashmir and all other matters related to the state , 
• excluding those with which the Ministry of External Affairs is concerned.
• Thus, a holistic view becomes possible on all matters pertaining to regulatory as well as development administration in Jammu and Kashmir.
• Matters related to terrorism and militancy in the state also fall within this department's purview.
• The department is also responsible for the implementation of the Prime Minister's package on Jammu and Kashmir.

DEPARTMENT OF BORDER MANAGEMENT

• This department deals with the management of Indian borders ,including coastal borders.
• It focuses on matter related to coordination of administrative , diplomatic,security,intelligence,legal ,regulatory and economic agencies 
• engaged in the management of internal borders,creation of infrastructure like roads,fencing,and floor lightning of borders etc.

DIVISIONS

As of 2011,the ministry of Home affairs has the following divisions
1. Administration Division
2.Border Management division
3. Centre-State Division
4. Coordination Division
5. Disaster Management Division
6. Foreigners Division
7. Freedom Fighters and Rehabilitation Division
8. Human Rights Division
9. Internal Security Divisions-two(1 & 2)
10. Jammu and Kashmir Division
11.Judicial Division
12. Naxal Divisions
13.North Eastern Division
14.Police divisions-two(1 & 2)
15.Police Modernization division
16.Police Planning divisions
17.Union territories division.

MINISTRY OF PERSONNEL,PUBLIC GRIEVANCES AND PENSIONS

• One of the important recommendations of the first Administrative Reforms Commissions was about the creation of a separate Department of Personnel, to be placed directly under the Prime minister.
• The commissions , in its report on the Machinery of government of India and its procedures of work had further suggested that this newly created government of should work under the general guidance of cabinet Secretary. 
• In fact,the commission had gone to extent of suggesting that the cabinet secretary should be , by convention, be regarded as the secretary General of this department , without being so designated formally.
• The Departments of Personnel was expected to deal with matters concerning the formulation and implementation of personnel policies concerning All-India and Central Services; Talent hunting,development of personnel for "senior management" and processing of appointments to senior posts;
• Manpower planning,training and career development,foreign assistance programmes in personnel administration;research in personnel administration;discipline and welfare of staff and machinery for redress of their grievances;liaison with UPSC,state governments and professional institutions etc. and staffing of the middle level positions in the central secretariat (of under secretaries and deputy secretaries).
• The government of India accepted the recommendation of the First ARC , with some modifications. 
• It was explained by the government that it would not be possible for the cabinet secretary to act as the Secretary General of the newly created department,though his broad guidance would always be available for its functioning .
• More particularly, the cabinet secretary was expected to carry a special responsibility for management tasks concerning senior management ie..joint secretaries and above in the secretariat and their equivalent positions outside.
• Since 1970, when the department of Personnel was created , there have been a few important structural changes affecting the department.
• In 1973, the department of administrative reforms,till then with the Ministry of Home affairs, was amalgamated with the department of Personnel and the newly created department was christened the Department of Personnel and administrative Reforms.
• Four years later in 1977,during the Janata Government ,. this department was transferred to the Home minsitry.
• Another change was introduced in 1985, when the Congress Government separated the department from the Home Ministry and carved out a new ministry called the Ministry of Personnel , Public grievances and Pensions.
• This was the upshot of a new emphasis given by the late Prime minister,Rajiv Gandhi ,to expeditious redressal of citizen's grievances and quick and effective disposal of pension cases of the government employees.

ORGANISATION

The Ministry of Personnel, Public Grievances and Pensions consists of three departments,namely,

• the Department of Personnel and Training.
• The Department of administrative reforms and public grievances and
•  the department of pensions and pensionary welfare.

• It is under the overall charge of the prime minister, assisted by a minister of state.
• There are two secretaries in the ministries. The secretary(Personnel)has under him additional Secretary (Service and vigilance), establishment officer cum additional secretary(Administrative Tribunals and administration, RTI,Central Services and Welfare),joint secretary (establishment) and joint secretary(training).
• The secretary(administrative Reforms, public grievances and pensions) is assisted by an additional secretary(administrative reforms and public grievances ).
• Besides there is a special secretary and financial adviser on the pattern of other ministries of the government of India.
• The ministry has four Joint secretaries, 31 directors , one joint and 10 deputy secretaries posted in various departments.

FUNCTIONAL AREAS

• The major functional areas of the ministry of Personnel , Public grievances and Pensions are discussed below under the headings of its respective departments.
• A glance at the vision and mission of the departments will provide us an inkling of its priorities and concerns.

Vision
To develop an enabling environment for the development and management of human resources of the government for efficient functioning of the government.

Mission

1.Providing a dynamic framework of personnel policies and procedures for the effective functioning of the government.

2.Developing competence and innovation in government.
3.Building capacity of human resources at all levels of government for efficient delivery of public services.
4.Inculcating and supporting a culture of transparency, accountability and zero tolerance to corruption in public affairs.
5. Institutionalizing a system for a constructive ongoing engagement with the stakeholders.

DEPARTMENT OF PERSONNEL AND TRAINING

The functions performed by the department of personnel and training relate to the following subject areas

Service Rules

The Department of Personnel and Training is responsible for the operation of the rules and regulations under the

•  All India Services Act 1951,
• Central civil services (conduct) Rules 1964, 
• The central civil services (CCA) Rules 1965, 
• Leave rules, 
• Rules relating to honorarium, 
• Night duty allowance and 
• Children's education allowance. 

It also has a central (surplus staff) cell which looks after adjustment and deployment of surplus staff.

Recruitment

For purpose of recruitment , the two main agencies are the 

• UPSC and
•  SSC, 

the former for groups 'A' and 'B' services, the latter for non technical group 'C' posts. 

The two conduct open as well as department examinations for the various services. Besides, the public enterprises selection board(PSEB) is entrusted with the responsibility of making recommendations for appointment to the full time board level posts of 

• chief executives,
•  functional directors and
•  part time chairman public enterprises.

All the three organisations, referred to above, are autonomous in decision making.The department of Personnel and training, however is the administrative department for these agencies, thus, facilitating their functioning and coordination of their operations with the rest of the government.

Reservation in central government services

Reservations for SC/ST in the civil service is made on the basis of the total number of vacancies occurring in each recruitment year.

Placement

• All posts in the central secretariat at the level of under secretary and above in the various ministries, departments and other offices of the government of India(except in the ministries of railway and external affairs) are filled up on the basis of tenure linked deputation under the central staffing schemes.
• The establishment officer of the department obtains the names of eligible staffing schemes.
• The Establishment Officer of the department obtains the names of eligible officer from the state governments and cadre controlling authorities and a list of the officers is drawn up, keeping in view of the eligibility of the officers to serve in the government of India. 
• Approval of the appointment committee of the cabinet(ACC) is required for all important appointments.
• The department plans for the career development of officers belonging to the Indian administrative Service. For this purpose , these officers are sent to field at appropriate stages of their careers.
• The officer are also sent on foreign assignments to developing countries, to the UN and other international agencies and programmes like the Indian Technical and Economic Cooperation Programme. 

Cadre Management

• Cadre management includes determining the strength of the central services-the number of candidates allotted to the IAS, IFS, IPS, central services group 'A" and Group 'B' and the allotment of probationer of each batch to various states /joint cadres.
• The authorized strength of the IAS cadre of all the states and UTs put together was 6077 as on 1 January 2011 and the number officers in position on the same date was 4356.

Cadre review

• Periodical review of the cadre strength of a regularly constituted service/cadre is an important element of cadre management, aiming at rationalization of the existing cadre structure based on man power projections.
• For cadre review, statistical information about the number of posts at various levels is compiled twice a year, on 1st January and 1st July.

Training

• The department has been instrumental in identifying functional areas of training as well as designing and implementing large number of training programmes for officers involved in the priority development sectors.
• It designs training policies and programmes for the All India and Central services, prepares material , maintains liaison with all training institutes at home and abroad and serves as the nodal agency of the central government for training activities.
• It is responsible for the administration of two prime training institutes like lbsnna, Mussorie and the institute of secretariat training and management, New Delhi. 
• Together with pre-entry training,it is responsible for organisation refresher programmes etc, for in-service employments department also gives grants in id to the Indian institute of public administration,New Delhi for undertaking specific training programmes.
•  It assigns every year a large number of training programmes to state level training institutions and provides grants for their conduct.these courses are organised for the capacity building of state level officers. 

Administrative Vigilance

• The department co-ordinates the work of various ministries/departments for maintenance of discipline and eradication of corruption in their respective operational areas.
• It handles all policies and administrative matters pertaining to the central bureau of investigation and the central vigilance commission.
• It handles all policy and administrative matters pertaining to the central bureau of investigation and central vigilance commission.
•  It formulates vigilance and anti-corruption measures and is responsible for the examination of disciplinary cases against officers(Grade I and higher level of the service).

Administrative Tribunals

• The central administrative Tribunal(CAT) was set up in 1985 to provide speedy and inexpensive justice to central government employees in respect of their service matters.
• The CAT has been adjudicating a large numbers of pending cases transferred to it from high High courts and sub-ordinate courts as well as cases instituted afresh.
• The Department of Personnel and training is the administrative department for CAT.

Joint Consultation and Compulsory Arbitration

• The government of India had introduced in 1966, a scheme for joint consultation and compulsory arbitration for the central government employees on the pattern of Whitley councils in great Britain. This is a non-statutory voluntary schemes. 
• The scheme of joint consultative Machinery (JCM) applies to all the regular employees of the central Government , except the group 'A' services , most group 'B' services, senior personnel of industrial establishments, UT employees and police personnel.
• The three tier machinery of JCM is the provision for compulsory arbitration in cases of disagreement , either in the national council or in the department council, between the official and staff on matters related to pay and allowances, hours of work and leave.
• For this purpose , a board of arbitration functions under the administrative control of the Ministry of labor.
• The Department of personnel and training , however is the catalyst to the functioning of the machinery for joint consultation and compulsory arbitration.

DEPARTMENT OF ADMINISTRATIVE REFORMS AND PUBLIC GRIEVANCES

The two functions of the department deals with 

• initiating and monitoring administrative reforms in the central government and
•  ensuring that citizens grievances against government organisations are redressed effectively.

Administrative Reforms

• The department conducts management studies, provides management services and undertakes research on general issues of administrative reforms.
• It provides management consultancy services to various central government ministries, particularly in relation to issues pertaining to organisational structure and methods as well as procedures prevailing in department/ministries. 
• The organisation and methods (O & M) activities include modernization of government offices through modern office aids, reduction in paper work, records management and minimizing levels of consideration in the disposal of work.
• From 2005-09, the department of administrative reforms and public Grievances was coordinating the work of the second ARC which was headed by Veerappa Moily. 
• The commission presented 15 reports, a reference to which has been made elsewhere in this volume.
• After the commission presented its final report , the Department of administrative reforms and public grievances has been examined by the government of India and the action taken reports have been brought out for almost all reports.Now, The department should ensure that the recommendations that have been accepted or are under the favorable consideration of the government are implemented effectively.

Public grievances

• Most pf the ministries or departments in the GOI have designated an officer each as director of grievances.Each such director is vested with powers to call for files/papers connected with a grievance pending for more than three months and do take a decision , with the approval of the head of the organisation.
• Meetings of such directors of various minsters or departments are held at regular intervals under the auspices of the department of administrative reforms and public grievances. 
• An Independent grievance redressal authority, in the form of directorate of public grievances has also been functioning in the cabinet secretariat since 1988. 
• Attempts are made to coordinate its functions with those of the department of administrative reforms and public grievances.

DEPARTMENT OF PENSIONS AND PENSIONERS' WELFARE

• This is the nodal agency for pension policy and is also concerned with the redressal of the grievances related to retirement benefits and welfare of pensioners.
• It formulates policies and design procedures for the grater convenience of retired and retiring employees.
•  With the setting up of central Pension Accounting office on 1 January 1990 the task of issuing pension payment orders is now being done by the concerned pay and accounts office through the central pension accounting office.
• Since its inception , the ministry of personnel , public grievances and pensions has been following a series of progressive measure and ensuing effective implementation of personnel policies.
• This has led to greater rationality, effectiveness and responsiveness in the public personnel system, administrative reforms and employees(including pensioner) welfare.
• Yet,the need is always there to remain constantly proactive rather than merely reactive in the dynamic world of goal oriented administrative change and management of human resources.

MINISTRY OF FINANCE

• The Ministry of finance traces its origin to the year 1810 , when a separate department of finance was first set up in what was then called the supreme government of India. 
• In 1843, with the reorganization of the supreme government , finance was one of the four departments , the other three being military , foreign and Home.
• With the achievement of independence , the fiance department was given the status of ministry organised into three major wings -expenditure, economic affairs and revenue.
• The number of departments in the minsitry has undergone changes several times with as many as five departments (revenue, expenditure, economic affairs , coordination and company law and insurance) in 1963, but as of the beginning of 2012, there were five departments in the ministry.
• The Ministry of finance is responsible for the administration of the finances of the central government.
• It manages the economy and finances of the entire nation and regulates and monitors the expenditure of the central government.
•  It is responsible for collection of revenues and besides, it mobilizes resources for development and other purposes. 
• Control over public expenditure is an important responsibility of the finance ministry as the interests of the taxpayer are not always safe in the hands of the spending unit which can protect them. 
• As the ministry of finance is extremely important and influential, it is always a senior cabinet minister who heads it. 
• In UPA-2 government , the second most powerful minister who is next to the PM, has held the portfolio of Finance
• He is assisted by two minister of state (though there may be variations in this combination from time to time).The division of functions among the minsters is made by the finance minister.
• The administrative head of the minstery of finance is the finance secretary who has under him a large staff. Generally , all senior posts in the ministry are held by officers belonging to the IAS. The post of finance secretary , however has become a subject of discussion since 1980s .
• This is so particularly in relation to the appointment of non-IAS officers to the post.
• Controversy arose when VP Singh appointed Bimal Jalan (replacing Gopi Arora) as the finance secretary. Jalan though a distinguished economist was not an IAS cadre officer. 
• In march 1993 , Montek Singh Ahulwalia was appointed the finance secretary.
• He too like Jalan was an economist and did not belong to any cadre.
• Before this appointment, Ahulwalia was working as the secretary in the economic affairs department of the ministry of Finance and was regarded as the alter ego of the finance minister.
• Media reports pointed out the immense resentment among the IAS circles over the appointment since the point of finance secretary is a crucial one and carries wit it an informal 'veto' power over the proposals for expenditure emanating from other ministries and departments.
• The Ministry of Finance also draws officers from other services such as the Indian Audit and accounts service, the central revenue service the central customs and excise service and the Indian railway accounts service and the central secretariat services.
• The Economic Intelligence Bureau was created in 1985 in the minsitry under the charge of a director general with the rank of additional secretary.
• It is designed to coordinate the intelligence, investigation and enforcement activities of agencies dealing withe economic offences and the enforcement of economic laws.
• The functions of the finance ministry are described below within the framework of the departments under which it is organised.

DEPARTMENT OF ECONOMIC AFFAIRS

The department of economic affairs (DEA) works under the overall supervision of the Secretary , Economic affairs who , in turn is assisted by a special secretary two additional secretaries , six joint secretaries and a number of directors.

This department comprises the following divisions-
1.Aid, accounts and audit division
2.Administrative Divisions
3.Bilateral Co-operation Division
4.Budget Division
5.Capital Market Division
6.Economic Division
7.Integrated Finance Division
8.Multilateral Relation Division
9.Indian Economic Service Division
10.Infrastructure And Investment Division
11.Multilateral Institution Division

• Besides, the department has a directorate of currency , Middle Office (Debt Management) and office of the chief controller of accounts.
• The Apartment has also a chief economic adviser who has a team of one principal adviser, a senior economic adviser, four advisers and five additional economic advisers.
• The economic division examines and analyses economic trends and advises the government on all matters regarding internal and external financial management.It advises the government on policy changes to accelerate growth and control inflation.
• The budget division is responsible for the preparation of the budget of the union government as well as those states which are under the president's rule, and presenting these before parliament. The capital market division accords recognition to stock exchanges.
• This division ensures that the transactions in stock exchanges take place in accordance with rules and laws and that holds the public faith in the investment system is maintained.
• The objective of various directions given by the divisions in this respect are systematic development of the capital market and the protection of the investors interests.
• The administrative division looks after the administrative and vigilance aspects concerning the department of economic affairs as well a its attached and subordinate offices.
• Aid, accounts and audit division is responsible for disbursement of loans and grants from multilateral or bilateral donors agencies, debt servicing of loans to these agencies, accounting of external assistance and export promotions audit.Bilateral cooperation division deals with bilateral development assistance form all G-8 countries.
• It also administers all short term foreign training programmes.
• Integrated finance division is responsible for tendering financial advice on all matters involving government expenditures of the department of economic affairs and the department of financial service. 
• Multilateral Relations division renders advice and deals with all matters related to G-20,G-24,G-8,OECD,EC,ASEM,WTO,UNDP,SAARC, Colombo Plan and International Technical Co-operation, Multilateral Investment Guarantee agency. 
• The Indian economic service division deals with the matter of cadre management of IES. Infrastructure and Investment Division handles the sectoral responsibilities pf infrastructure including the railways, telecommunications ,roads, ports, shipping, civil aviation , power, coal, no-conventional energy resources and inland water transport.

Functions

• The Department of Economic Affairs deals with several important matters such as internal finance,import and export of gold and silver,fixation of interest rates for the central government's borrowing and lending , and accounting and audit procedures.

• It controls foreign exchange, budgeting , foreign and non resident Indian investment and foreign exchange resources.
• The department also prepares the central budget excluding the railway Budget and also prepares the budget of sate where President's rule is in operation.
• It is also responsible for the management of financial emergencies under article 360 of the constitution.
• An important aspect of national economies is the borrowing and loaning that the government does with foreign states.In this context , this department maintains contact several institutions such as IBRD, European economic community , the ford foundation, the Rockefeller Foundation, the commonwealth foundation, the commonwealth fund for technical co-operation, The India Consortium and agencies of the UN.
• It also handles the aid govern by India to the members of the Colombo Plan , to African countries under the special Commonwealth African Assistance Plan Programmers and to any other country excluding Nepal,Bhutan and Bangladesh.
• Regarding the field of investment ,it performs functions functions like control over the issues of capital by joint stock companies, regulation, and development of stock exchange, investment policies including that of LIC of India,Unit Trust of India and General Insurance Corporation of India,flotation of market loans by the central government and new investments and securities for mobilizing resources from the capital markets.
• It fixes the interest rates for the central government borrowings and lending.
• The Department of Economic affairs manages the Indian Economic Service in terms of its personnel matters and regulates the duties and powers of the CAG. 
• It deals with the administration and control of government funds such as the contingency fund of India, institutions such as the Finance Commission and national schemes such as the Public Provident Fund Schemes, National Deposit Scheme and compulsory Deposit schemes. 
• It is also responsible for the administration of National savings Organisation and small savings. Besides ,it renders economic advice to the government on matters relating to the internal and external aspects of economic management , including prices.

Department of Expenditure

The Department of Expenditure of the ministry of Finance controls the entire expenditure of the central government. It is headed by secretary who is assisted by one special Secretary, One chief Adviser , an additional Chief Adviser and a number of Joint secretaries.the department comprises six units-
1.Establishment Division
2.State Finance Commission
3.State Finance Division(Plan Finance III)
4.Public Procurement Cell
5.Staff Inspection Unit.
6.Pay Research Unit

The Department of Expenditure is the administrative department of

• Controller General of Accounts , 
• Office of the Chief Controller of Accounts,
• Central Pension Accounting office,
• Office of Chief Adviser Cost, and 
• National Institute of Financial Management.

Functions

• The department of Expenditure administers all financial rules, regulations and delegation of financial rules, regulations and delegation of financial powers and deals with financial sanctions concerning all state legislation having financial and economic implications.
• It releases grants and loans for the state plans, state finance, plan budget and advance plan assistance for expenditure on relief measures at the event of natural calamities.
• It is the administrative authority for the Indian Audit and accounts Department , the comptroller General of Accounts , the cadre management authority for Group 'A'(Indian Civil Accounts service) and Group 'B' officers of the central civil accounts. Besides it organises training and examination for the central civil accounts staff belonging to groups 'C' and 'D'.
• The Department of Expenditure determines the general principles of government accounting concerning the central and state governments, forms of accounts and framing or revision of rules and manuals.
• It oversees the maintenance of adequate standards of accounting by the central civil accounts offices.It also responsible for the consolidation of monthly accounts , preparation of annual accounts showing the annual receipts and disbursements for the purposes of the Union government under the respective heads.
• It enforces the central treasury rules and assists the ministry and departments in the introduction of management with the reserve bank in general, and reserve deposits pertaining to civil ministries or departments in particular.

DEPARTMENT OF REVENUE

The Department of revenue functions under the overall supervision of the secretary (Revenue) who is assisted by an additional secretary (revenue), Special secretary cum Director council, central Economic Intelligence Bureau(CEIB), Director (Enforcement), and a number of secretaries and other officers.The Department of Revenue controls revenue matters relating to direct and indirect union taxes.It exercises this control through two statutory boards :

• The Central Board of Direct taxes and 
• central board of excise and Customs.

Through the medium of tax laws and their administration , the department achieves three main objectives, viz

1)to build an atmosphere of trust between the tax collector and the tax-payer,
2)to tackle the problem of tax evasion, recover and reduce tax arrears, and
3)to give incentive by suitable legislation in furtherance of the socio-economic policies of the government .

• As already mentioned , in 1985, the central Economic Intelligence Bureau was set up in the department of revenue under the overall supervision and charge f a Director-General , who is an officer of the rank of a special secretary.
• The bureau coordinates and controls the intelligence and investigate activities of enforcement agencies concerned with economic offences and the enforcement of economic laws.
• It also responsible for monitoring the activities of the state under the Conservation of Foreign Exchange and prevention of smuggling Activities Act. (COFEPOSA).

Functions:

• The revenue Department is the controlling and administrative authority for several departments , chiefly the Income tax department , the Narcotics Department . 
• The central Board of Direct taxes and the Central board of excise and customs.It handles all questions concerning income tax and taxes such as corporation tax, capital gains tax, excess profit tax, business profit tax, estate duty, wealth tax, expenditure tax and gift tax.It is responsible for the supply and distribution of all kinds of revenue stamps , duties on bills of exchange , cheques, promissory notes , policies of insurance , transfer of share, debentures, proxies and receipts and administration of excise of the union territories.
• The department has a preventive role to play regarding narcotics and liquor.
• It controls the cultivation , manufacture sale and export of opium and the administration of the Narcotics Drugs and Psychotropic Substance Act, 1985.
• All matters relating to the Act 1975 come within the purview of the department.Matters relating to custom(sea,air and land) and duties on imported or exported goods and prohibitions and restrictions on imports and exports also fall within its ambit. 
• Value added tax(VAT) is another important subject which falls within the jurisdiction of the department.Other subjects under its jurisdiction include levy of tax on inter state trade or commerce, all questions relating to replacement of sales tax by additional excise duty, all bills etc. relating to sales tax levy in states coming up for the prior institutions, recommendations or assent of the president of India, and legislative matters in the union territories concerning VAT.the on-going consultations on Goods and Service Tax also come under its purview.
• Lastly,it has an important role to play in controlling illegal economic activities.It is responsible for preventive detention for the purpose of conservation of foreign exchange,prevention of smuggling activities, all matters relating to economic intelligence and investigation and adjudication and prosecution of cases arising out of breaches under the foreign Exchange Regulation Act 1973.
• Searches are also conducted by the income tax department and in this process , undeclared assets are confiscated.

DEPARTMENT OF FINANCIAL SERVICES

• The erstwhile banking and insurance Division of the department of economic affairs, Ministry of finance became a separate department of financial services on 28 June 2007.
• The department is mandated to look after issues related to public sector insurance companies and pension reforms.

The Department is headed by a secretary who is assisted by an additional secretary,five joint secretaries, one economic adviser and eleven directors /deputy secretaries.It has three divisions

1)Banking divisions
2)Insurance Division
3)Pension Reforms Division

DEPARTMENT OF DISINVESTMENT

• The vision of the department is to promote people's ownership of central public sector enterprise in order to share their prosperity through disinvestment. 
• Its mission is to list all profitable central public sector enterprise on stock exchanges with an objective of promoting corporate governance,transparency and accountability and to push forward a disinvestment process to facilitate unlocking the true value of the central public sector enterprise for all stakeholders-investors, employees, company and the government.
• The Department of Disinvestment is headed by a secretary who is assisted by an additional secretary , two joint secretaries, several directors, deputy secretaries and under secretaries.
• Besides,it is assisted by an advisory board, a few consultants and Chief executive officer, NIF(Joint Secretary level officer). The department functions on the desk officer pattern and the disinvestment work is handled at the minimum level of Under-Secretary.

APPRAISAL

• Since 1991 , the role of Ministry of Finance has expanded significantly.
• The phenomena of globalization , privatization , disinvestment in the public sector etc. have entrusted the ministry with additional responsibilities.
• With the Indian economic ideology taking a 'U' turn, the expectations of the people and the attendant criticisms of the detractors have focused attention on the working of the finance Ministry. 
• De-regulation of the private sector and de-bureaucratization of the economic system have brought in their wake newer challenges and opportunities, for which , until recently , the Indian economy was not mentally prepared.
• yet,it must be said to the credit of the fiance Ministry that it has launched the movement of a 'free' economy with rigor and is taking every step with marked precision in that direction.there are no doubt setbacks now and then , as for instance the double figure inflation and instability of the rupee towards the end of 2001-but the determination to change the structure of the economy appears to be unswerving.
• On the other hand , a series of measure for encouraging portfolio investment, global depository receipts and direct foreign investment have been taken.
• Reforms have been introduced in regulating the banking industry, simplifying tax procedures and expanding the tax phase and a challenging one too.
• One must not, however miss the conventional criticisms of the ministry of Finance regarding its tendency of over controls in regard to the government expenditure and its essentially conservative approach to budget implementation. 
• From Paul Appleby to the administrative reforms commission and onwards, a general feeling against the negative centralizing role of finance ministry has persisted.It os hoped however that a liberal approach, in the true sense, will percolate the ministry's functioning as the global vision gradually envelops the ministry's perspectives.
• Regarding the financial adviser , the second ARC IInd in its report on strengthening financial management system has recommended that the role of the financial adviser as the chief finance officer of the ministry of finance or department who is accountable and responsible to the secretary of the Ministry/Department should be recognized and the trend of dual accountability should be dispensed with.
• Yes it is to be ensured that only those officers should be posted as Financial Advisers who have sufficient training and experience in the modern financial management system.
• The past few years have been a difficult phase for the ministry of Finance.In the UPA-I government , the pressure from CPM obstructed the process of second generation economic reforms.Ironically,the same fate awaited the UPA-2 government , though the actors had changed.
• India has bitterly experienced slow down of the growth rate, a double digit inflation, devolution of the rupee, quiet recession, a halt on disinvestmnet of public enterprises, impediments to industrialisation on account of land ownership disputes, opposition to FDI in multi brand retail trade, whopping black money in the country and abroad, a spate of scams, including in the corporate sector (Satyam being one) and a general climate of policy paralysis.
• The leader who was the finance minister during unfolding of a new era of liberalization in the early 1990s, finds himself handicapped at a time when he is at the helm.these are paradoxes of time individuals should not be blamed; 
• Only transformed situations have to understood and confronted rationally.Still one cannot dispute the fact that fundamentals of the Indian economy have been right, though they need a corrective action incessantly.

The SARC Perspective

The Second Administrative reforms commission in its Report of organisational structure of government of India has made a few recommendations which deserves attention:

• The concept of a ministry should involve a group of departments whose functions and subjects are closely related and are assigned to a first or coordinating minister for the purpose of providing overall leadership and coordination. As a consequence of this, rationalization of the secretary level post , wherever required, may also need to be carried out.
• By grouping together closely related subjects, the number of ministries in the government of India should be reduced to 20-25
• Attached and subordinate officers should serve as the executive agencies of the ministries and concentrate on the implementation of government policies and programmes.
•  Decentralization and delegation of functions should become the core values of organisational functioning in the government.
• The number of levels through which a file passes should not exceed three.

This is not of the catalogues of reforms needed in the structuring of ministries and departments.In fact , only a rigorous research in the functioning of various agencies will reveal the areas of improvements desirable in each government organisation and at macro level as well.