Thursday, February 15, 2001,
Chandigarh, India


M A I N   N E W S

Punjab draws up VRS
by P. P. S. Gill

Tribune News Service

CHANDIGARH, Feb 14 — In pursuant to the proposal made by the Finance Minister, Capt Kanwaljit Singh, in his Budget (2000-2001) speech in the Punjab Vidhan Sabha on March 22 last, a voluntary retirement scheme (VRS) has been approved by the Standing Committee of the State Renewal Fund that met here on Tuesday.

This is part of the efforts to compress non-essential and non-productive expenditure and reduce the growing size of the government.

Besides this, the Core Group for Public Sector Undertakings and Apex Cooperative Institutions, which also met on Tuesday, decided to refer the case of seven public sector undertakings (PSUs) and that of the Directorate of Institutional Finance and Banking and Public Enterprises to the Public Sector Disinvestment Commission for “winding up or liquidation” appraisal and study.

At the same time, the Core Group took cognizance of the fact that despite government decisions taken several years ago on the “closure” of six PSUs, these continued to function, technically and legally, with the skeleton staff still drawing salaries. At the next meeting of the group the administrative secretaries concerned will be called to explain and responsibility will be fixed for the delay in implementing the decisions.

Both meetings were chaired by the Chief Secretary, Mr N. K. Arora.

Informed sources told Tribune News Service today that the VRS would be placed before the Council of Ministers for formal approval at its next meeting. It would be notified before the presentation of next year’s Budget.

The three-member subcommittee on the VRS, appointed by the Standing Committee at its meeting on August 22 last, has recommended the following five broad parameters:

— Employees with over 10 years of service or over 40 years of age will be eligible

— Payment at the rate of 60 day’s emoluments for each completed year of service or monthly emoluments on the day of voluntary retirement for the remaining months of service left or five years, whichever is less

— Payment, 100 per cent, to be made in cash and 50 per cent of that to be in the General Provident Fund for a period of three years

— Travelling and dearness allowances to the place of settlement

— Statutory payments like provident fund, gratuity, leave encashment and application pension etc.

The sources said the VRS would be applicable to all government employees and those working in PSUs and apex cooperative institutions.

Insofar as funding of the VRS is concerned, the subcommittee, comprising of Mr D. S. Guru (Director, Industries), Mr Suresh Kumar (Registrar, Cooperative Societies) and Mr C. Roul (Director, Institutional Finance and Banking and Public Enterprises), has recommended that those PSUs and cooperative bodies that cannot bear the expenses should be advanced a loan by the government or should dispose of their assets. For this purpose, it was necessary to enhance the fund level of the State Renewal Fund.

The Standing Committee decided that against Rs 25 crore proposed in the Budget (2001-2002), a sum of Rs 50 crore should be earmarked. This committee consists of the Financial Commissioner, Cooperation, the Principal Secretary Finance, the Principal Secretary to the Chief Minister and the Secretary, Planning.

The details of the VRS relate to the general conditions (that will apply to those who avail themselves of the scheme), the procedure involved and the form required.

Capt Kanwaljit Singh had also announced in his Budget speech that leave of the kind due up to a maximum period of five years would be allowed for enabling government officials to start their own ventures. In the event of their being successful, they could seek retirement with due retirement benefits or opt for the VRS or serve for the remaining period. This scheme, however, is yet to be notified.

The Core Group has decided to forward to the Public Sector Disinvestment Commission, headed by a former Chief Secretary, Mr P. H. Vaishnav, the names of seven PSUs for appraisal before being closed down. These include the Punjab State Forest Development Corporation, the Land Development and Reclamation Corporation, the Seed Corporation, the Tourism Development Corporation, the Punjab Financial Corporation and the Water Supply and Sewerage Board.

The sources said the Financial Commissioner, Development, Mr C. L. Bains, raised the issue as to what was really meant by “disinvestment” in a PSU or apex cooperative institute. Mr Roul was asked to include an appropriate definition of “dis-investment” while forwarding the names of the PSUs to be closed down to the commission. In fact, one of the agenda items was the “Delineation of the role of the disinvestment Commission vis-a-vis the Core Group in the process of disinvestment”.

The Core Group meeting was attended by Mr K.R. Lakhanpal (Finance), Mr K.S. Janjua (Cooperation), Mr C.L. Bains (Development), Mr R.I. Singh (Industries and Principal Secretary to the Chief Minister), Mr Sudhir Mittal (Planning) and Mr Suresh Kumar (Registrar, Cooperative Societies).

The group, the sources said, took serious note of the fact that despite the government’s decision on the “closure” of the Punjab Film and News Corporation, the Handloom and Textile Development Corporation, the Leather Development Corporation, the Hosiery and Knitwear Development Corporation, Punwac (Punjab women and children corporation) and the Poultry Development Corporation, these continued to function, technically and legally, with the skeleton staff getting salaries. 


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