PM's Panel Says Privatization Hurts Workers
Times News Network
May 27, 2003

NEW DELHI: The high-powered committee tasked by Prime Minister Vajpayee to look into the privatisation of Balco and Modern Foods (MFIL) has found that the interest of workers has been overlooked by the new owners, Sterlite and Hindustan Lever (HLL) respectively. The report will be submitted in July.

The committee - comprising one joint secretary each from the disinvestment and labour ministries, RSS-affiliated Bharatiya Mazdoor Sangh president Hasubhai Dave and Employers Federation secretary-general Sharad Patil - was set up by the Prime Minister's Office last year and has visited Balco and MFIL units.

According to a highly placed source, "though the new managements followed the share-purchase agreement by not doing anything to employees in the first year, they began voluntary retirement and even compulsory retirement schemes within days of the stipulated period ending. The spirit of fulfilling a promise is missing."

In Balco, committee sources say, Sterlite "forced VRS on employees and decided to pay the amount in five instalments. This is against all norms. Those who refused are being troubled through transfers."

Asked by TNN for its reaction to these charges, Sterlite did not reply.

In MFIL, the committee report will allege that HLL has also "flouted norms". Says a source, "It is unbelievable that in just over two years, HLL has cut staff strength from 1,650 to 850 and is in the process of shifting its Delhi machinery to Jaipur. The Faridabad unit has already been closed. Their only interest is in the land."

An HLL spokesman justified the staff strength cut. MFIL's "critical shortcoming was a large workforce and relatively low productivity", he said. As for VRS, it has been "implemented in a proper, humane manner with far better terms and benefits to employees" than before privatisation.

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