In an effort to ensure faster procurement of specific procurements that are needed for operational preparedness, the Ministry of Defence has increased the financial powers of the Vice Chiefs of the Army, Navy and the Air Force by five times. Sources confirmed to FE Online, that “There has been increase in the financial powers for the Vice Chiefs from the existing Rs 100 crore to Rs 500 crore now.”
The financial enhancement has been approved of the three chiefs to make certain categories of procurement, as this ensure that the armed forces are able ensure a high degree of serviceability of the in-service equipment, procurement of stores including ammunition. Earlier this year, the defence minister Nirmala Sithraman had approved “substantial’’ an enhancement of the financial powers of the three chiefs.
According to sources, it was raised upto Rs 100 crore in the segment of revenue procurement. The ministry said the enhancement of powers of the vice chiefs is for cases under ‘Single Tender Enquiry’ (STE) and the Proprietary Article Certificate (PAC) categories
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In 2017, the then defence minister Arun Jaitley had enhanced the financial powers of the armed forces in an unprecedented move. It was done primarily to expedite the decision making process involved in the modernisation of the security apparatus of airbases and defence installations.
This empowered the three Vice-Chiefs of the three Services to place orders, procure equipment and carry out civil works without further seeking approvals of the MoD. A strict time line was fixed in 2017 to ensure that the works are undertaken on priority and in a time-bound manner to ensure full security of country’s critical defence assets.
According to an earlier MoD statement so far, powers for procurement of articles under Proprietary Article Certificate (PAC) and Single Tender Enquiry (STE) were restricted to 50 and 5 per cent, respectively, of normal powers delegated for revenue procurements. Wherever full powers had been delegated with respect to PAC and STE, a cap of Rs 50 crore and Rs 5 crore, respectively, were made applicable.
With this delegation, the powers of the Vice Chiefs in respect of PAC cases, restricted to 50 per cent of competitive bidding cases, had been increased and made equal to the powers delegated in competitive bidding cases. The financial delegation represents a significant jump in the powers currently exercised by the Services.