Hire and fire policy sets us apart from a govt body, says GSTN CEO

If the rates change, they have no impact on the system as they have been kept out, says Prakash Kumar

The private technology backbone of nine-month-old goods and services tax — GST Network — has been able to deliver to a great extent the performance that the government expected from it, says CEO Prakash Kumar. While there’s a strong buzz that GSTN is being turned into a government body, Kumar tells Dilasha Seth it is the government’s prerogative to decide the structure of the network. Edited excerpts:

How would you describe the last one year?

The GST portal has completed one year and five months. It has been both exciting and challenging.

Did you anticipate the scale of changes in rates and law that we have already seen?

If I say we were not aware, that will be wrong. We were aware and were ready to deliver. For any new law that’s been drafted has rough edges that are smoothened during execution, and also by orders of court and adjudicating authority. So, GST was a completely new concept for a federal country like ours, where all the indirect taxes that were administered by either the Centre or states were brought together. 

Did the frequency of changes mean a setback for you?

If the rates change, they have no impact on the system as they have been kept out. We knew from past experience that rate adjustment takes place. And like any new law, it takes time to stabilise. Therefore, we kept it out. However, other things like the change in forms had an impact.

The government has always supported the idea of a private GSTN. Why is there a move to turn it into a government body?

I have no idea about that. The government created the GSTN as a private body and now it may want to change it to a government body. That is fine. It is the government’s prerogative.

Have you had a talk with the finance ministry on this?

There hasn’t been any communication that it is being done. I could comment only if something comes to me. Besides, it’s not my prerogative. The government created the structure in a certain way and now if it wants to change the structure, 

it is fine.

What about procurement and salaries?

We follow the government procurement tool. We are audited by the Comptroller and Auditor General and come under the Right to Information Act . The only difference is our hiring and firing policy, which is like that of the private sector. Our salary structures are what you have in the private sector. But that bit gives us the competence to hire the right kind of people.

So is hiring and firing a faster process in GSTN?

Yes, the only difference between us and a government company is related to hire and fire policy. Hiring is done through a process including screening by the board. Firing is shorter. If you are not performing, we give a chance to improve. If the performance improvement programme doesn’t work, you are out.

Has there been any firing so far?

Yes, four in the last 18 months. But I’m reiterating that it is the government’s prerogative to decide the structure. It has asked us to perform and to a great extent we have been able to achieve that. Therefore, I do not think that 

the government will take a decision that will completely upset the GSTN body.

While simplification of return filing is expected, do you feel the current system is better as it has stabilised?

This is a policy matter only the Council can take a call on. But they will need to give us enough time to come up with the new system. The industry and GST suvidha providers also need time.