Friday, January 15, 2016

Government Takes Initiative For Timely Wage Revision

In last past five decades, trade union leaders of   public sector banks used to make appeal after appeal to Indian Bank Association to start Negotiation for Bipartite Settlement for wage revision for bank staff. Bank staff used to use the tool of strike even to build pressure for beginning of negotiation. After wasting more or less one year , IBA used to say that the will talk to Ministry of Finance and then time used to be given for beginning of process for negotiation. Bipartite Settlement could take final shape and could become effective only after lapse of 2 to 3 years.  

Keeping this trend , even leaders of various unions associated with bank staff used to submit even Charter of Demand after lapse of few months after due date for beginning of revised wage scale. In this way, wastage of time even in preparation of  Chartered of  Demand had become a normal culture. Bank staff used to cry for early settlement and leaders used to pacify them by submitting lame excuses.

In the history of trade union movement , I think it is the first time that Ministry of Finance has taken an initiative to awaken sleeping trader union leaders from their deep slumber . It is the first time that Ministry of  Finance has written a letter to Chiefs of all banks to begin talks for next Bipartite Settlement which is due in November 2017, i.e . almost two years in advance.  

Though I have been writing in my blogs since long to submit Chartered of Demand adequately in advance so that final signature on Bipartite Settlement can take place in time and bank staff may not suffer loss of interest and may not be required to suffer loss of pay in using the coercive tools like strike. But our so called militant leaders turned deaf year and blind eyes towards all voices raised by bank staff. Now on advice of FM, it is the turn of trade union leaders  to respond quickly . Let us see how much time they take in submission of Chartered of Demand.

I submit hereunder copy of letter written by ministry of finance which is genuine and confirmed.


In this way Ministry of Finance has put pressure on Chiefs of Public Sector Banks to initiate process of next settlement and ensure that it concludes before  due date for next wage revision.

 Now chiefs of banks will speak to trade union leaders to submit charter of demands for next bipartite settlement. Really , now you may say 'sun rises in west'. Water has started flowing in reverse direction. This is charismatic Modi government. Now back management may threaten trade union leaders of punitive action if they delay in process.

However I am unable to understand why MOF has thought it fit to ignore Indian Bank Association. Perhaps this is because , IBA is also a body which is manned by same gang of casual and ineffective officers. Fate of PSBs is bad only because large scale corruption and bad culture in top officials. 

As a matter of fact it is only bad officers who are generally and mostly picked up for top posts at all level . These officials have damaged health of banks and they will damage the organisation wherever they have been posted even after retirement. I therefore do not have much hope from committee which has been constituted to select talented officers in bank.

Culture of flattery has become permanent at all levels. When top officials meet Finance Ministers and RBI Officials during various top level meetings, they do not have courage to put before them the problems banks are facing and frustration bank staff are facing due to delayed wage revision or PSBs are suffering losses due to vote bank politics. 

This is why health of PSBs is worsening quarter after quarter though all top bankers, Top RBI officials  and ministers and Ministers used to make promise to take care of banks and promise to make all possible efforts to contain rising trend of bad debts in these banks.

Ever quarter , there is rise in volume and ratio of bad debts and stressed assets in these banks compared to private banks , but these top responsible officers do not feel shame that they always fail and they are unable to find out the reason as to why they have been failing to achieve the goal of cleaning banks even after lapse of a decade.

Finance Minister and RBI officials perhaps do not understand the actual reason of bank growing in sickness and this is why they usually prescribe wrong medicine which instead of curing the health worsen its health. This is why despite all efforts made by Government and despite several circulars and guidelines issued by RBI and GOI to cure sick banks and to reduce NPA, volume of NPA is continuously increasing and every year  GOI is forced to infuse additional capital to save banks.

Root cause of growing sickness in public banks is that Flatterers, Yesman and Corrupt officers are getting priority in all matters. It may be promotion or for posting a person as Branch Head or Regional Head or Zonal Head. Even auditors and inspecting officers or vigilance officers are those who are ready to act as per whims and fancies of their bosses. It is always beneficial for a junior officer to take care of his or her bosses than to take care of his organization.

As a matter of fact majority of top officials prefer picking up officers of their choice for promotion irrespective of merit or demerit of the candidate appearing for promotion. It is undeniable truth in public sector bank that Promotion of an officer to higher scale  depends not on his experience or degrees or his performance but largely depends on the quality and perception of the Member in panel constituted for conducting Interview for promoting an officer from one scale to higher scale.

These quality are

a. Caste and community of the Member in panel constituted for Interview.

A member of a particular caste or region will like to pick officer of his caste or region for promotion. A officer from South India will give more value to South Indian officer. Similarly an officer of Bihar or Bengal or Gujarat will give preferred treatment to a Bihari or Bengal or Gujrati officer. This is human nature barring a few exception.

b. Honesty and Integrity of Member.

If the member is corrupt , he will definitely like to give more weightage and more preference to a candidate who knows the art of earning bribe in various ways and who honestly share the ill-earned money with his bosses. If the member is dry honest, then only he will reject dishonest officers in process of promotion.

c. Member who like Flattery.

In such cases only Flatterer and Yesman are given priority. Officers who are rigid on working as per rules and who only take care to protect his organisation even at the cost of his own family life and that of his bosses are given little weightage. Officers who do not dance as puppet of higher officials are denied promotion by interview panel despite all good record of performance.

d. Members who believe in degrees.

Such officers will give value to those candidates who are having more degrees . Even if candidate perform worst in practical banking, such officers are given more weightage in interview. Banking is such type of service industry where importance of relation with customers and knowledge of work he is assigned to perform is more important than his educational degrees. Business of bank grows by quality of customer service not by persons possessing high degrees. Marketing of banking products depend not on degrees but on selling skills one possesses.

e. Members who believe blindly in achievement of target given to a candidate.

In such case officers who are working in administrative officers are ignored and officers who achieve target in branches are given priority. Officers who do not achieve targets due to genuine reason are also rejected. Not only this , it is a truth that undue pressure for achievement of targets forces a greedy officer to compromise with quality.

An officers who earn in sanctioning of loan has the capacity to buy deposits from government departments and buy business from private companies too by offering costly gifts to dealing persons.

 An officers posted in towns and cities get ample opportunity to garner good business for the branch he or she is posted whereas an officer who is posted in remote rural areas or in critical areas, in naxal affected areas, in flood and draught affected areas, in special areas, in backward area or in  an area where no big companies are existing, is not able to give a good growth of business as his colleague sitting in Industrial area can give. Again there is injustice to an officer without any of his fault.

f. Members of Interview in panel who give value to profit will pick those officers who earn profit for the bank and who create less and less bad assets. But there are very few such officers. 

 Even in such cases, officers who are posted in big and old branches have to face a lot of litigation, lot of militant politicians, local mafias who build pressure for loan, and where a lot of works are such which cannot be measured but the officer has to face them. They get good opportunity for business too but they may not have adequate manpower. These officers will seldom get time in mobilising business as per expectation of higher bosses. On the contrary officers posted in new branches or comparatively less older branches will get ample time to move in the market to garner business.

There are many such branches where Branch Head is constrained to  kill entire time in dealing with crowd of customers which are non profitable. There are occasions where officers have to waste time in executing non-profitable tasks assigned to them under pressure from State Governments or by central government. There are officers who have to waste time more in doing non-banking business like insurance or demat account or portfolio management. These officers suffer for none of their faults.

As a matter of fact there is no such yardstick in the almirah of any bank which can measure true and real  output of an officer judiciously and uniformly.

 If top official  of any bank want to favour any officer X working as Branch Head in a branch  in promotion , he will provide all support of manpower X  and to his or her  branch and on the other hand if top officer  do not want to promote a Branch Manager Y , his branch will be given less and less manpower and good officer will be replaced by bad officers. This is called silent killing of goodness and awarding and promotion of badness. This results in culture of flattery and bribery.

Obviously potential of all branches of any banks are not having same quality of business and same scope of business growth.  In such position giving value to profit or business growth is totally unjustified and it gives ample opportunity to non-performers to rise and punishes to those who are unable to achieve the target by doing honestly business.

Officers who are crazy for promotion indulges in bad practices, sanction bad quality loans, open accounts of fake persons to attract black money, promotes money laundering, make finance to fake companies , indulges in window dressing, manipulates figures of bad companies to make them fit for sanction of loan etc. He can do all right or wrong things to get illegal money and unethical promotion in the name of merit.

 It is this class of officers who are adding more and more stressed assets to their bank and it is they who get quicker promotion and choice posting . But such officers are never good for the organisation.

In this way it becomes clear that quality of bank asset depends not on the post of an officer , but on the real quality of officers who is handling the business of a branch or a bank.

If a flatterer officers is promoted to higher scale or posted at powerful post superseding many experienced and senior officers, one officer getting promotion will become loyal to his bosses who help him in promotion but hundreds of senior officers who are ignored face humiliation . As a result , one bad officers get elevated and he goes on adding more and more stressed assets whereas hundreds of frustrated and humiliated officers who are real jewel for banks  become dormant  and silent spectator of what is happening to their beloved organisation. 

Lastly it is the bank which has to suffer whereas corrupt officers get quicker and quicker promotion and get safe retirement.  Top officials promoting bad lending are never taken to task whereas officers who are forced to process bad proposal are taken to task. This bad culture in Public bank is unchallengeable and unstoppable.

Some people who get quick promotion at the cost of senior and experienced officers start talking of merit oriented promotion  policy . It is a fact that each public bank has Merit Oriented Promotion Policy in place and in action for last three decades and more.  Officers found to be meritorious in eyes of Interview panel got three or four promotions in ten years. But they could not ensure good quality of assets.

Management of banks also recruited so called talented boys and girls from educational campuses and gave them higher salary of higher scale. Banks recruited several credit officers orcmarketing officers from market or from campus and paid double salary to attract talent. But in practice, these so called credit officers caused much loss to bank and created more stressed assets than an experienced officer in lower scale normally creates.

Banks are said to be managed by meritorious officers for last three decades and more . Still health of bank is found to be worst and going from bad to worse and worse to worst. Stressed assets in public bank has gone up from 2 -3 percent to 25-30 percent. Stressed assets in public banks have gone up beyond control whereas asset quality of private banks face no pain and profit of private banks increase every quarter.

Last but not the least, even leaders of trade unions who are supposed to be protectors of their colleagues and that of organisations are victim of same evil culture of bribery, flattery and yesmanship.

Munsi Premchand said,

" Jab Rakshak Hi Bhakshak Ban Jaye to Vinas Nishchit Hai".

It means when protectors including higher bosses and trade union leaders start looting bank in their own style, there is none on this earth who can save banks from disaster.

Finance Minister can change bottle or rename it, but he has to do a lot to change wine.  It is a Himalayan task for any Government to change evil culture prevailing in public sector banks or in PSUs or in government departments.






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