These are engaged in execution of policies formulated by the secretariat. These are headed by an executive head like director, inspector general, commissioner etc. There are two types of executive offices:

  1. Attached office: They provide executive direction needed in policy implementation laid down by ministry to which they are attached. They also furnish technical data to ministry to which they are attached.
  2. Subordinate office: Agencies responsible for execution of decisions of government. They work under direction of attached offices.

Pattern of relationships

  1. Complete separation
  2. Complete merger
  3. Link officer merger: A senior secretariat officer is head of executive agency.
  4. Common file patterns
  5. Common office patterns
  6. Ex officio secretariat: The head of agency is member of secretariat.

Second administrative reforms commission recommended that agencies involved in development functions should be integrated with secretariat.

Public Enterprises

These are also executive agencies and of the following types: Departmental undertakings, public corporations, government companies and holding companies.

Departmental undertaking: Entire investment is by government. Private players are barred. It is financed by the treasury and entire revenue earned is credited to treasury. Auditing on lines of a government department, permanent staff is civil servant. Recruitment and service conditions are same as any other government department. It is accountable to parliament by a minister and possesses sovereign immunity of government.

Advantage Disadvantage
provides maximum degree of control by minister lacks autonomy
has clear responsibility of government department excess control and low initiative and flexibility
enables government to have better control rigid, financial control
standard patterns and rules of government. high centralization
suitable for strategic sectors of country like defence, railways bureaucratic structure so inefficiency and no incentive to provide better service. Monopoly in country makes it free from improvement.

Public Corporations: Corporate body created by public authority with defined powers, functions and financial independence. It is wholly owned by state. But no immunity from suits. It is independently financed with limited autonomy. It isn't subject to financial controls of parliament. Board of directors are appointed by government and Public undertakings committee examines its matters.

Advantage Disadvantage
Autonomy in day to day administration rigid structure can be amended by statutes
free from political interference problems are seen when government tries to control it through board of directors
synthesis of commercial efficiency of private company with accountability of government interference by ministers who can force them to follow directions.
financial flexibility and personnel autonomy seen Comes under ambit of agencies like CVC, CAG and CBI that hinders decision making

Government Company: These are established under the companies act.Government prefers private limited companies and keeps majority share holding with itself. This is outside the ambit of government rules and other controls. It has operational flexibility and financial autonomy.

Features: Government controls them through board of directors so autonomy is limited. Government can force it to declare dividends, buy shares etc. Easy, expansion, allows equity from private sector too. So management is diverse. Suitable for non strategic, commercial functions.

Holding Company: Integrates all companies operating in same management if they are working in same area. Facilitates coordination and execution of policies. Directors can be appointed by government as per the share holding. Proxy control and interference possible. Shall remain subject to CVC, CAG and CBI till government control is majority. RTI Act also remains applicable. All above factors hinder decision making.

  1. An MoU can be signed between government and management to provide greater autonomy and reduce interference in day to day administrative matters.
  2. Make PSU management responsible and accountable for results but give them sufficient autonomy.
  3. Define obligations of both parties to improve performance.
  4. Reduce government share holding to below 51% wherever possible like non strategic sectors.
  5. Government should practise management by exception.
  6. Block interference of courts in public enterprises.