I am surprised to see some persons who still argue for the necessity of continuing the Bipartite Negotiation mechanism in banks, for improvement in wages, other benefits and the existing service conditions of staff.
The basic premises of such people are totally wrong. They have some imaginary fears about the composition, functions and limitations of a Pay Commission. They have a negative impression about the Commission and nurture a suspicion about its usefulness and effectiveness. They openly argue that a Pay Commission cannot satisfy the aspirations of the beneficiaries to the maximum possible extent.
To allay their fears and disprove their suspicions, I present my detailed views here.
A Pay Commission is usually headed by a retired justice of the Supreme Court/High Court. He is assisted by some eminent persons of immaculate calibre, with long experience and proven capabilities. They are from diverse backgrounds like Finance, HRD, Labour, Law, Accountancy, Secretarial Practice and the one relating to the field of the intended beneficiaries. Ideal size of the Commission will be 5 and it may go up to 7.
Unlike in the bipartite negotiation process, suggestions and proposals are openly invited from all, through the official website of the Commission, as soon as it is constituted and it starts functioning. Individuals can send their submissions directly to the Commission, through post and also in person. All submissions must be in writing. Such submissions may be in the form of a well drafted ‘Charter of Demands’ or simple views and proposals. If reasoning is also adduced alongside these proposals, they will carry more weight and have the prospect of being considered favourably.
Any individual or a group of individuals or a registered association of staff or the federation of multiple unions are permitted to submit their demands, views and proposals to the commission directly. It is very important that the identity of such individuals/groups is properly established, beyond any doubt. Their contact particulars like name, occupation/designation, full address, phone numbers, email ID etc. are furnished by them in all their communication.
If necessary, the individuals concerned or the representatives of the groups/associations/ federation are invited to depose before the Commission and present their submission in person, with supporting documents. They shall go prepared to answer the queries, if any, from the members of the Commission. Though it is not like a court like atmosphere, everything is recorded and the full text of the proceedings is signed by all concerned at the end of every day.
People who meet the Commission members need not have any fear or inhibition. They can talk freely, of course within the boundaries. Everything takes place in an open, democratic atmosphere.
The whole exercise is so simple, easy and transparent from the beginning to the end that nobody can find fault with.
One more beauty of the process is, the same person/group can send as many proposals as they like, provided each of them is supplementary to their other submissions and are not inconsistent and self-contradictory. Nobody is denied a second opportunity.
Every Pay Commission has a fixed tenure and it has to submit is report, with its detailed observations and recommendations within this time limit. This is a very important feature of this process.
Occasionally, an interim report is submitted by the Commission, if the process of preparing its final report takes a longer time than anticipated. If deemed necessary, extension of the Commission’s tenure is also sought and allowed.
If you want to know more about this, go through the voluminous reports of various pay commissions at the centre and in states. They are accompanied by a good number of exhibits and documentary evidences. Even in banking industry, you can go through the Sastry Award and Desai Award reports in full.
These reports are prepared with due diligence and extreme care, after going through a lot of inputs patiently and methodologically. Thus, the exercise is totally professional and scientific.
Besides the beneficiaries in service, the retired personnel are also encouraged to present their demands and views to the Commission. This provision is absent in the Bipartite Negotiation process. In the aftermath of introduction of pension in banks, the necessity of presenting an opportunity to the retired personnel is felt more, especially in the matters affecting their interests.
It is true that the final findings and recommendations of the Commission may not give 100% satisfaction to all. However, they will be the best possible in the prevailing circumstances.
Icing on the Cake:
Even after the report is submitted by the Commission, the government will give another opportunity to all the registered groups/associations of staff to present their comments and grievances by meeting the government officials, so that the government will be in a position to take a fair and balanced view. It has happened in many cases that the government has awarded better pay scales and more benefits to the beneficiaries than what was actually recommended by the Pay Commission, before notifying the report in the official gazette.
Now, you tell me honestly, do you still consider the Bipartite Mechanism as superior and the best?
In the present day's circumstances, the relevance and effectiveness of Bipartite Mechanism have died, as they are conducted in a totally closed and secret atmosphere, without taking the beneficiaries into confidence. The views and aspirations of the ground level staff are never taken into account by IBA nor the negotiating team from the registered Trade Unions.
Are we prepared to conduct a referendum on this issue - Bipartite Negotiation versus Pay Commission?
Date: 23-01-2016 pannvalan
What Is Role Of RBI in Keeping Bank Safe and Healthy and whether RBI has completely failed in performing its duty?
I have full expectation that Mr. Jaitley and Mr. Modi together will do all their best , far far better than past Finance Ministers Mr. Chidambram , Mr. Mukherjee and Mr. Manmohan Singh like persons who damaged fundamentals of banking during their rule of decades. Leaders of Congress Party has damaged not only banking culture but entire Indian culture. I put stress on fact that , it is they who perpetuated a culture of exploiting banks for vote bank and who injected bad blood in banks under public sector.
Malady is deep rooted and no power on earth can clean it overnight or in a year or two. I therefore always say that corruption flow from top and it is ministers of previous rule who promoted reckless lending , sometimes in the name of poor and sometimes in the name of development of infrastructure or power . I feel pleasure to observe that present RBI Governor Mr. Raghuram Rajan has taken few initiatives to improve the health of PSBs.
Mr. Chidambram left no stone unturned to use banks for enhancing vote bank of congress party. Now bankers are also cultured to lend without verifying quality of borrower and quality of project. During course of time and under the leadership of Congress Party bankers also learnt to sanction loan blindly to achieve target and to get quicker promotion. Bitter truth even now is that bankers are ready to say 'NO' to anyone who come for seeking loan from bank. Rather bankers are snatching business of other banks . PSBs are competing with each other and causing loss to public money. Unscrupulous persons get success in getting loans from many banks by offering gifts to top officials in cash and kind. Culture of bribery and flattery in PSB has taken deep roots and to add fuel to fire , even trade Union leaders who are supposed to be protectors of banks also started acting in tune with corrupt bankers .
It has become a culture in PSBs to lend quickly , declare the loan as NPA and then write it off or sacrifice huge amount in compromise settlement. Court cases have become ineffective in recovering loans from defaulters. Cases filed in various courts have been pending for decades undecided . Administrative offices and police do not take care to recover loan from defaulters. And so on..
Even now bankers are not ready to punish corrupt borrowers, corrupt bankers and corrupt politicians. Unless we learn and unless Government learn to punish erring officials in bank, erring officials in administrative and legal machinery and unless the get success in stopping politicians misusing banks for vote , we cannot dream of an improvement. neither in health of bank or in wage structure of bank staff. It will take a long time to change the culture .It is easy to preach sermons to banks for Mr. Modi but it is very difficult to change the deep rooted dirty culture of bankers and politicians he is associated with.
Modi and Jaitley have to first understand that PSBs are not profit making entity and hence there should not be imposed target or pressure for credit growth or profit growth at par with that in private banks. PSBs cannot be used for social welfare schemes and at the same time expect to earn greater profit too. Private banks in same economic condition earn huge profit and achieve large credit growth whereas PSBs fail in all respect , rather they are facing erosion in capital, erosion in profitability and erosion in credit quality and monitoring of assets. It will take long time when government will understand that managing banks is not as easy as they think for it.
Defaulters must not flaunt money: Raghuram Rajan-Times of India- 23.01.2016
Read Full Article in Times of India
Malady is deep rooted and no power on earth can clean it overnight or in a year or two. I therefore always say that corruption flow from top and it is ministers of previous rule who promoted reckless lending , sometimes in the name of poor and sometimes in the name of development of infrastructure or power . I feel pleasure to observe that present RBI Governor Mr. Raghuram Rajan has taken few initiatives to improve the health of PSBs.
Mr. Chidambram left no stone unturned to use banks for enhancing vote bank of congress party. Now bankers are also cultured to lend without verifying quality of borrower and quality of project. During course of time and under the leadership of Congress Party bankers also learnt to sanction loan blindly to achieve target and to get quicker promotion. Bitter truth even now is that bankers are ready to say 'NO' to anyone who come for seeking loan from bank. Rather bankers are snatching business of other banks . PSBs are competing with each other and causing loss to public money. Unscrupulous persons get success in getting loans from many banks by offering gifts to top officials in cash and kind. Culture of bribery and flattery in PSB has taken deep roots and to add fuel to fire , even trade Union leaders who are supposed to be protectors of banks also started acting in tune with corrupt bankers .
It has become a culture in PSBs to lend quickly , declare the loan as NPA and then write it off or sacrifice huge amount in compromise settlement. Court cases have become ineffective in recovering loans from defaulters. Cases filed in various courts have been pending for decades undecided . Administrative offices and police do not take care to recover loan from defaulters. And so on..
Even now bankers are not ready to punish corrupt borrowers, corrupt bankers and corrupt politicians. Unless we learn and unless Government learn to punish erring officials in bank, erring officials in administrative and legal machinery and unless the get success in stopping politicians misusing banks for vote , we cannot dream of an improvement. neither in health of bank or in wage structure of bank staff. It will take a long time to change the culture .It is easy to preach sermons to banks for Mr. Modi but it is very difficult to change the deep rooted dirty culture of bankers and politicians he is associated with.
Modi and Jaitley have to first understand that PSBs are not profit making entity and hence there should not be imposed target or pressure for credit growth or profit growth at par with that in private banks. PSBs cannot be used for social welfare schemes and at the same time expect to earn greater profit too. Private banks in same economic condition earn huge profit and achieve large credit growth whereas PSBs fail in all respect , rather they are facing erosion in capital, erosion in profitability and erosion in credit quality and monitoring of assets. It will take long time when government will understand that managing banks is not as easy as they think for it.
RBI has almost discontinued taking stock of what bankers are doing , they have completely stopped the work of inspection and they have no courage to tell anything to ruling politicians even if they give wrong dictation to bankers. Before 1991, RBI used to inspect various branches of all banks to find out quality of lending and quality of control and accounting in banks. But slowly they left this work. RBI during last three decades trusted certificates , right or wrong submitted by bank officials on various subjects. In the name of liberalisation , government to some extent ended license raj but introduced certificate raj.
Fact is that even Chartered Accountant who are supposed to certify correctness of accounting and write about actual health of bank's assets have become a commodity which top officials buy easily by paying handsome amount to them and by extending red carpet welcome to them . Even vigilance officials and auditors , internal or external , rating agencies , all are submitting reports and issuing certificate of health on the basis of illegal money they get in return.
It is therefore true to say that it is not easy for RBI and GOI to transform and reform public sector banks. Let us however have positivity in our mind at least from current government.
Defaulters must not flaunt money: Raghuram Rajan-Times of India- 23.01.2016
Lashing out against promoters of defaulting companies who continue with lavish lifestyles despite owing thousands of crores to banks, Reserve Bank of India governor Raghuram Rajan has said that these businessmen are sending a wrong message and pushing up the cost of borrowing for others.
"If you flaunt your birthday bashes even while owing the system a lot of money, it does seem to suggest to the public that you don't care. I think that is the wrong message to send. If you are in trouble, you should be cutting down your expenses," said Rajan in what appeared to be a veiled reference to Vijay Mallya, promoter of Kingfisher Airlines. Mallya had recently celebrated his 60th birthday in style in Goa despite his Kingfisher Airlines owing banks over Rs 7,500 crore.
In an interview to NDTV, the governor said that the clamour for lower interest rates should include efforts to get the banking house in order in respect of default recoveries. "The system has been geared to favouring those who have the ability to work the courts. The policy that you (large businessmen) follow is that during good times you take the upside but in bad times you go to banks and ask how much of a haircut are you going to take?" He said that while the bankruptcy law would be a powerful tool, it had some way to go. In his interview, Rajan said that this was not about being against big businesses or successful businessmen and neither was it a Robin Hood issue. "This is an issue about the wrongdoers among the community who raised the cost of borrowing for everybody."
"If you flaunt your birthday bashes even while owing the system a lot of money, it does seem to suggest to the public that you don't care. I think that is the wrong message to send. If you are in trouble, you should be cutting down your expenses," said Rajan in what appeared to be a veiled reference to Vijay Mallya, promoter of Kingfisher Airlines. Mallya had recently celebrated his 60th birthday in style in Goa despite his Kingfisher Airlines owing banks over Rs 7,500 crore.
In an interview to NDTV, the governor said that the clamour for lower interest rates should include efforts to get the banking house in order in respect of default recoveries. "The system has been geared to favouring those who have the ability to work the courts. The policy that you (large businessmen) follow is that during good times you take the upside but in bad times you go to banks and ask how much of a haircut are you going to take?" He said that while the bankruptcy law would be a powerful tool, it had some way to go. In his interview, Rajan said that this was not about being against big businesses or successful businessmen and neither was it a Robin Hood issue. "This is an issue about the wrongdoers among the community who raised the cost of borrowing for everybody."
Read Full Article in Times of India
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