While the Pension Fund Regulatory and Development Authority (PFRDA) is getting ready to play a larger role after PFRDA Act is in place, an unusual selection process is going on to appoint its two whole-time members.
PFRDA chairman Yogesh Agarwal, is apparently not taken into confidence and not included in the selection committee to appoint the two members. The panel includes the chairman of the Insurance Regulatory and Development Authority (Irda), TS Vijayan.
“It is strange that the selection of whole-time members of PFRDA is decided by a panel that includes the insurance regulator. At the same time, PFRDA chairman has no clue about the appointment of two members who will assist him in running the regulatory body,” said a person who is familiar with the development.
When contacted, Agarwal said, “I don’t know why I am not there in the panel. You should ask the finance ministry. I have no comments.”
In addition to Vijayan, the other members of the panel are financial services secretary Rajiv Takru and the secretary, Department of Personnel and Training.
It has been a practice or rather the prerogative of a regulator in the financial sector like the Governor of the RBI, chairman of the Sebi and chairman of the Irda to be part of the panel along with other top government officials to select the immediate deputies of that regulatory institution.
Ministry sources point out that there is a view that Agarwal was appointed for five years as the PFRDA chairman since June 7, 2010, during the term of then finance minister Pranab Mukherjee, when it was not a statutory body.
The question is whether same appointment can be valid since the institution is now a statutory body. However, it is unlikely that the government may look for another chairman when Agarwal has another 20 months to go.
The PFRDA Bill was passed by Parliament on September 6.
Before assuming charge at PFRDA, Agarwal was the chairman and managing director of IDBI Bank.
The job of whole-time member at PFRDA is being eyed by bureaucrats and senior officials of other regulatory bodies like the RBI, Sebi and Irda. The government is yet to announce the names selected by the panel.
As per the government notification, the applicant for the position of whole-time member should have a minimum of two years of residual service on the last date of submission of application and the age not to exceed 60 years.
Government and PSU employees can also apply but would need to resign before taking charge. The appointment would be for five years with a provision of reappointment subject to the maximum age of 62 years.
The pay and allowances of the whole-time member will be Rs 3.125 lakh per month without the facility of house and car.