Odisha shifts focus from external consultants to in-house capacity building, mandating prior approvals for future engagements to strengthen internal governance systems
OdishaPlus Bureau
The Government of Odisha has issued a significant directive aimed at curbing the extensive reliance on external consultants, Project Management Units (PMUs), and Technical Support Units (TSUs) across its departments and subordinate agencies.
In an Office Memorandum (No. 22296/F., FIN-COD-MISC-0009-2019) dated July 31, 2025, the Chief Secretary, Manoj Ahuja, mandated that all future engagements of consultants and similar entities will require prior approval from a high-power committee, with proposals routed through the Finance Department.
This move signals a strategic shift towards leveraging internal government capabilities and fostering institutional memory within the state administration. The latest order highlights a growing concern within the government regarding the “indiscreet engagement of consultants”.
The memorandum points out that State Government Departments and subordinate organizations have become overly dependent on external expertise, leading to underutilization of existing internal manpower and a decline in in-house capacity building. The Chief Secretary emphasized that the purpose of bringing in external expertise was to foster a collaborative ecosystem, enhance efficiency, and build institutional memory, ultimately to improve the efficiency of State Government employees.
The latest order by Chief Secretary Manoj Ahuja reinforces the principles of making it mandatory for State Government Departments to assess their actual need for consultants and propose the optimum number to the Finance Department.
The Finance Department will then present the matter to a committee under chairmanship of the Chief Secretary with Development Commissioner-cum-ACS, Secretary of GA & PG Department, Secretary of Finance Department, and Secretary of the Department concerned as members. This committee will decide on the appropriate number of consultants to be engaged. Crucially, the order states that “Without prior approval of the above-said Committee, remuneration shall not be paid to any consultant (engaged in whatever name and form) after 01.04.2026”.
This new directive builds upon a previous instruction issued by the then Chief Secretary on September 12, 2019, vide FD Letter No. 31162/F.
The 2019 letter, addressed to all Additional Chief Secretaries, Principal Secretaries, and Commissioner-cum-Secretaries of all Departments, acknowledged that PMUs, TSUs, and external consultants were initially permitted due to manpower shortages in critical areas. It noted that guidelines were previously issued by the Finance Department in 2011 and 2012, with a comprehensive circular released in 2018.
However, the 2019 communication also observed that many consultants were engaged for routine work, failing to contribute to institutional memory and capacity building. It explicitly stated a concern that departments were becoming increasingly dependent on outside resources, neglecting the utilization of available internal manpower.
The letter highlighted substantial recent recruitments in various cadres, bringing in talented individuals with experience and expertise, whose services need to be effectively utilized and groomed for greater responsibilities.
The 2019 letter further stressed that the notion of PMUs/TSUs necessarily requiring external consultants is a “misnomer”. It advocated for strategies to ensure that such units contribute to in-house capacity building, enabling regular officers to eventually take over these responsibilities. It explicitly discouraged the creation of new PMUs/TSUs with external resources, allowing it only in “rarest of the rare cases” for short durations with minimal outside support. Renewals of engagement were to be reviewed at the highest departmental level based on need, not as routine.