I wonder whether this has happened before in India’s public sector: the chairman of a public sector unit is demoted to managing director. As chairman of Life Insurance Corporation (LIC) T S Vijayan served a successful five-year term by more than doubling the balance sheet, fighting the onslaught from private insurance companies and computerising operations. Clients can feel the difference and efficiency in all segments of LIC’s functioning. To pay a premium now, you need to click only once after entering the LIC’s website.
A significantly large amount is being pumped every year into the secondary market by an efficient investment division in a well-orchestrated manner, which imparts stability in a volatile stock market. Shouldn’t all this go to his credit?
Now, it seems clearance from the Central Vigilance Commission has not been obtained for renewing his term for two years. Can this invoke a demotion?
His fault is that one executive under him who was running a subsidiary that is less than one-twentieth the size of LIC allegedly accepted some money for granting a loan. That executive is definitely an offender if he is proved guilty. But does that amount to a systemic failure? Media reports have pointed out that none of the loans for which bribes were purportedly taken have turned bad; they are adequately secured.
The government has also given tens of thousands of crores to domestic financial institutions and banks for re-capitalisation. Were these not largely needed due to bad assets? For the sake of promoting professionalism in the management of public sector organisations and a healthy environment, the government should reverse this demotion.
S C Saha, Kolkata
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