Left reforms PSEs with a human face

Employees at 18 public sector enterprises to get pink slips-and social security.

If you have ever wondered what the Left slogan of "reforms with a human face" meant in real life, here is an example "" West Bengal's ruling Left Front government will close down 18 state-owned public sector enterprises (PSEs) under a programme in which out-of-work jobbers will be retrained with new skills to become entrepreneurs.

Being implemented by the department of public enterprises and industrial reconstruction of the state government, the scheme, called social safety net programme (SSNP), is substantially funded by the UK Department for International Development.

There is minor budgetary support from the state Budget. The Ramakrishna Mission is the implementing agency for SSNP.

The Left 'reform with a human face' programme also rides on the credibility and wide reach of the Ramakrishna Mission network.

"The SSNP is a manifestation of the government's concern for the welfare of the employees of its loss-making PSUs that have to be restructured in the larger interest of the state's economic growth," says Nirupam Sen, the state industry minister.

Under the SSNP, retrenched employees are offered an early retirement scheme (ERS) which has a monetary and a social security aspect. The monetary part comprises normal retirement dues and ex-gratia related to the period of service rendered by the employee or remaining years of service.

The social security component consists of a medical and accidental/disability insurance coverage of Rs 50,000 each for the employee and his spouse for the residual period of the employee's service.

But most workers would have no idea how to manage the ERS funds or to put it to work to yield a decent income in the years to come. This is where the SSNP comes in, to provide re-skilling and training to the retrenched employee, or his nominee, in vocational courses or services through the RM.

They are also given in and post-training counselling, as well as help in the formation of group ventures. To provide additional funds if needed, the state government is negotiating with the Allahabad Bank for soft loans for such ventures.

So far, 1,700 workers with five units have availed of the ERS. Two units were shut, and three are being closed.

The SSNP is not compulsory either. If the workers want to go their own way, they are free to do so. But quite a large percentage have come forward to learn the vocational courses.

On offer are training modules in financial accounting, desk top publishing (DTP), servicing of two-wheelers and small vehicles, mobile handset service and maintenance, management of cyber cafes, air-conditioner manufacture in the unorganised sector, besides others.

The SSNP has a strong anti-poverty angle as it rehabilitates laid-off workers and this has made it eligible for the DFID funds, according to sources in the UK agency.

"Some degree of initial reluctance is normal since no government has ever taken up such a scheme. But I am confident that the SSNP will succeed as workers see the benefit," Sen points out.

So far, a sum of Rs 59.5 crore has been spent on ERS at the five units. The state chipped in with Rs 5.5 crore and the DFID paid Rs 54 crore.

The state's agenda for PSEs involves restructuring of 16 units at a cost of Rs 225 crore. The state will contribute Rs 25 crore and DFID, the balance.

Sen feels the first phase involving the five units has been a success. The government is eager to restructure all the sick units in the subsequent phases. The model is good for the country, he said. "I do not see why this cannot be implemented in the national level," he added.

Restructuring of the PSEs would encompass the closure of units declared 'non-viable' by specialist consulting firms through a transparent process of evaluation.

Left ideologues claim this model of economic reforms is unique as it is focused on improving people's lives while eliminating loss-making PSEs that drain budgetary resources.