In recent times, an idea has caught on in Nepal too. The government has emphasised enlisting public participation in its undertakings. This is part of the policy of privatisation and economic liberalisation adopted since about the start of the 1990s, of course, encouraged by the donors. Consequently, the post-1990 governments have handed over the ownership of several public enterprises (PEs) to private investors by tender, or floated shares, and given part of the ownership to employees. The concept is sound, as it utilises the funds people have, make them stakeholders in big corporations, and give the employees an added sense of belongingness. This process is also expected to contribute to better management and greater performance of those business entities. But the pace of this change has been rather slow. In the past nearly two decades, it has gone on in fits and starts.

This concept is becoming popular even in new ventures, for instance, in hydropower projects undertaken by the Nepal Electricity Authority (NEA), a government entity. But some fair ground rules for ownership need to formulated. Seeking public participation implies involving the general public to the maximum extent possible. In the Chilime hydel project, the NEA holds 51 per cent equity, the NEA staff 25 per cent, and the general public 24 per cent. The project operates as a limited company, and has been in the business several years, having distributed cash dividend three years, yet no shares have been floated in public so far. This is a case of putting the cart before the horse. Secondly, by far the largest portion of the equity available for divestment should be offered to the general public. The employees, just because they happen to be working in the organisation concerned, cannot claim any right to the detriment of the interest of the general people. The privilege of separate share allocation for them should not entitle the staff to more than a small part of total equity, 10 per cent at a maximum.

The government, the management and the employees are merely the trustees for the public property that lies with the government undertakings. In the upcoming Tamakoshi hydropower project, however, the local people are reportedly likely to be given, wisely, a certain per cent equity ownership. Thirdly, the selling companies should not be allowed to charge the staff and the general public widely differing rates of shares, as in the case of the Nepal Telecom, which sold to the employees below par (Rs.90 per share of Rs.100 par value) but extracted from the general public Rs.600 apiece. This grossly unfair decision cost the Nepali people several billion rupees. Fourthly, the definition of an employee should not, unlike in the Telecom case, include outsiders who are on the boards, such as government secretaries and members of the public. The rules regarding share allocation should be fair and strict, without providing room for selfish manoeuvre. The next government should see to these aspects, as well as to the importance of floating the shares of many government undertakings, such the NAC, the NOC, the Gorkhapatra Corporation, for more reasons than one.