Public-private partnership comes under RTI Act

Central Information Commissioner (CIC) and former activist Shailesh Gandhi’s path-breaking order in connection with the powerful Public Health Foundation of India (PHFI) is set to shed a great deal of sunlight on secretive public-private partnerships (PPPs) to build roads, airports and other sensitive infrastructure. Under the UPA government, PPPs have been the favourite vehicle to get public policy and infrastructure issues out of the purview of Central vigilance and audit agencies, through deals hidden from the public. They also stay out of the purview of the Right to Information (RTI) Act by claiming they are not ‘public authorities’.

Moneylife has written extensively on how PHFI, which will frame India’s public health policy, got massive land and funding from the government (Centre and states) and remained outside public scrutiny. Rajat Gupta headed PHFI until the US Securities Exchange Commission charged him with insider trading; NR Narayana Murthy now heads it. Like others, PHFI also argued that it wasn’t a ‘public authority’ under RTI but would voluntarily provide information to Kishan Lal, the Mumbai applicant. Yet, the matter reached Shailesh Gandhi, the CIC in appeal. Mr Gandhi’s order succinctly deals with two issues. He defines why a PPP would be considered a ‘public authority’ under the RTI Act. One reason was the presence of five powerful public servants, who, according to a parliamentary committee report, ‘represented the government’ on PHFI’s board and ensured its transparent functioning. Second, Mr Gandhi examined what constituted ‘substantial’ government contribution and decided that any grant of over Rs1 crore by the government is ‘substantial’ enough to deem a PPP a public authority. In PHFI’s case, the Central government contributed Rs65 crore or 30% of the funds required in the first year.

The PHFI order, if it is not challenged in court, will throw sunshine on all PPPs through RTI. Shockingly, some PPPs had even claimed in the past that their original agreements with government giving them rights over key resources were not available. Mr Gandhi’s order exposes this attitude by pointing to the “emergence of a multitude of PPPs in different sectors,” which are envisaged as “an arrangement between the Government and private entities with clearly laid down rights and obligations.” The PPPs, by their very nature, stipulate both monetary and non-monetary contributions from the government and a degree of government control in their functioning as partners. Hence, he rules, “PPPs would come within the ambit of ‘public authorities’ as defined in the RTI Act thereby enabling citizens to know/obtain information about them.” Mr Gandhi underlines the seriousness of his stance by ordering PHFI to pay a compensation of Rs3,000 to the applicant for “loss and detriment suffered by him in pursuing the complaint.” This alone is a source of enormous encouragement to the RTI community.