Faced with a manpower crisis due to neglect of human resource issues, the committee led by Dr AK Khandelwal has called for an urgent realignment of HR practices in public sector banks
The committee tasked with looking into the human resource (HR) issues of public sector banks (PSBs), led by the ex-chairman of Bank of Baroda, Dr AK Khandelwal, has proposed some sweeping changes in the way PSBs recruit, compensate, incentivise and plan for succession of employees under their fold.
Identifying certain gaping holes in the way HR issues are administered by PSBs, the Committee has made several recommendations to bring the banking system back on track in terms of manpower. PSBs seem to be facing a crisis of sorts, with almost half the top management cadre retiring in the next couple of years, with no identifiable talent to replace them. The system faces a high degree of attrition, with new recruits jumping on to better opportunities elsewhere for want of adequate compensation. On the whole, this situation has arisen out of the years of neglect in strengthening HR policies and practices.
Taking this into account, the Committee has sought to create a robust HR framework within PSBs. Informed sources told Moneylife, "If you allow a problem to accumulate, it shows up in a variety of ways. Since a lot of people are retiring at the same time and attrition is high, it has created a vacuum and a skill gap in the system in key areas like risk management, treasury and international banking. Therefore, HR issues have suddenly come to the centre-stage. I do believe that HR issues have become the new risk factor in the banking industry."
As the first step, the Committee is understood to have proposed that a board committee on HR should be formed in each bank. Banks having business worth Rs3 lakh crore and a staff of 30,000 will be required to appoint an executive director-HR on their board. The Committee has also recommended a monitoring committee in the ministry of finance, headed by the secretary, joint secretary and two HR experts to draw up the HR record of each bank and initiate a bank-wise reform process.
Among other things, the Committee wants banks to do away with the present practice of an industry-wide wage settlement. Instead, it has called for having wage settlement at the individual bank level, with each bank deciding its own wage structure depending on its profitability and capacity to pay. Our source says, "There are unique bank-specific problems that cannot be addressed with an industry-wide settlement. There is no linkage with capacity to pay. Since the settlement is done at the industry level, most of the initiative at the bank level gets lost."
The Committee has also suggested changes to the archaic recruitment criteria of PSBs. For clerical staff, the Committee has proposed that the minimum qualification should be graduation, instead of the current SSC requirement. Also, for the officer cadre, it has suggested that they should hold a banking diploma, apart from graduation. It has also recommended some changes to the test structure of PSBs, taking into account modern skills sets required for the banking function.
To ensure that banks have a proper succession framework in place, the Committee has proposed that a bank's board should do succession planning for each key leadership position by identifying three potential successors. The Committee has also provided for the setting up of a national level Banker's Leadership Development Institute, a greenfield project, which will be a big academy for developing leaders for the banking industry.
Apart from this, the Committee has sought changes in the welfare and reward provisions of PSBs. The Committee has asked that the ceiling for welfare contribution be raised to Rs40 crore from the present Rs15 crore and that 25% of the welfare contribution be directed towards retired staff.
To strengthen the presence of banks in rural and semi-urban areas, the Committee has provided that new recruits, especially clerks, be posted in rural areas for three years and in order to encourage them to move to rural areas, banks should provide them incentives in the form of faster promotion.
Money is a topic rarely spoken about in Indian households. The only time you may have heard the...
Savita Narayan reports on an NGO that is trying to give the handicapped child opportunities for a full life and be well integrated with society
Nineteen years ago, when Dr Madhumita Puri was working with All India Institute of Medical Sciences (AIIMS), New Delhi, she came across many children with physical and mental disabilities. What struck her was how worried parents were regarding their future and their ability to fend for themselves. These special children needed opportunities to lead full lives. Dr Puri, a PhD in psychology from Delhi University and a practising child psychologist, worked with the department of paediatrics at AIIMS.
The Society for Child Development (SFCD) was founded as a non-profit organisation to establish programmes and initiatives in 1992 to create a world of equal opportunities for people with disabilities. Under this initiative, Prabhat (which means dawn) was launched as a school for children with learning difficulties. Dr Puri says, “I started Prabhat because there was a need for such a facility here. Institutions for disabled children exist in other parts of Delhi for which the students needed to travel across the city. I began with my savings, increasing facilities and programmes as and when the need cropped up.” Today, Prabhat’s 70 students range from 3 to 18 years. The school offers learning with specially-designed workbooks and toolkits for basic academic concepts. Physiotherapy, speech and drama therapy are employed. Also included are outdoor activities, social-skill training and behaviour modification techniques.
SFCD has several market-oriented programmes that offer training to students over 18 years at its Vocational Training and Production Centre. The students produce high quality acid-free handmade art paper used by artists under the “Art for Prabhat” initiative started in 2001. An annual art exhibition highlights how beauty and creativity emerge from the efforts of handicapped children once they are made aware of their potential.
Clean Yamuna Temple Flower Project of SFCD converts flowers offered in temples into eco-friendly, herbal, coloured powders for Holi. These flowers were being dumped into the river Yamuna or left to fester in garbage dumps. Nearly 100 schools and 50,000 children from special, government and private schools have participated in cleaning the Yamuna. Eco-Tarang is a newsletter in which students of special schools report about their work on the environment. Trash-2-Cash produces coasters and fabric used for conference bags, curtains and pouches from discarded floppies, audio tapes, video tapes and other waste materials. A traditional weaver’s loom is used to manufacture durries, stoles, shawls and table mats.
SFCD has a holistic approach to disabled children. Disability India Network, a unique online resource, was started in 1999 to disseminate information on disability issues. Then came the pro-bono counsel for the disabled and their families—Online Legal Aid Cell. Both have provided much-needed information and support on schooling, employment, family law issues, property and financial matters concerning the disabled. The cell handles an average of 15 cases a month. It has also produced legal multimedia modules.
Awareness and sensitisation programmes with equal participation of disabled and non-disabled children together help build awareness and empathy. These have been sponsored by the National Green Corps of the ministry of environment and forests.
The Parent Support Network is a forum to provide support and education to parents on issues pertaining to the disabled. Many parents are disheartened only due to lack of awareness of therapy and opportunities for improvement of their children’s lives. The group conducts workshops on child rearing, raises awareness on employment and sexual health, rolls out micro-credit programmes for self-employment of the disabled, peer support, guidance and social interaction.
Dr Puri believes that the disabled Indian child does not need a handout, just a hand. SFCD’s aim is changing attitudes of parents and society at large in order to give the handicapped child all opportunities to lead a full life and be a well-integrated member of society. All donations are exempt from Income-Tax under Section 80G.