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Shedding flab at major ports.... -- A VRS with a different `wave'length

P. Manoj

HAVING signed a new wage agreement with the workers federations recently, the Ministry of Surface Transport is now focussing on sweetening the Voluntary Retirement Scheme (VRS) at major ports in a bid to attract more workers and slim the blo ated workforce to impart efficiency in port operations.

According to the proposal, the existing VRS is being improved upon by offering two months' salary for every completed year of service or the total emoluments he would have got if he had continued in service, whichever is lower, to those who avail of the scheme, Government sources said.

The identified surplus is in the range of about 10,000 workers (nearly 10 per cent of the total workforce at major ports), comprising mostly those who are involved in cargo handling operations. In the Ministry's view, these workers have become redundant with the introduction of automation and mechanisation of cargo-handling operations. But due to the out-dated system of gang-based employment rather than need-based one, these workers continue to exist on the rolls.

At major ports such as Paradip, Mumbai and Visakhapatnam, some of them work for hardly 10-12 days a month and are practically jobless for the balance period.

Similarly, the number of workers required for office work will be much less, owing to computerisation, rendering thousands of employees surplus.

The 11 major ports in the country will have to cough up about Rs. 500 crores for implementing the improved VRS, assuming that each employee opting for the scheme will have to be paid Rs. 4-5 lakhs, on an average, towards his salary and pensionary benefit s.

The sweetened VRS will be funded solely out of the internal resources of the 11 major ports, most of which are cash-rich. The majors ports -- Mumbai, Kandla, Chennai and Visakhapatnam -- have adequate surpluses to fund the new VRS, wherea s other major ports -- Paradip, Mormugao, New Mangalore, Jawaharlal Nehru and Tuticorin -- can comfortably fend for themselves.

The Ministry of Surface Transport anticipates a problem only in the case of Cochin and Calcutta ports which have marginal or no surplus for financing the Scheme. Officials say that the comfortable financial position of the Mumbai Port would enable it to support one or two ports for bankrolling the scheme.

According to plans, the Ministry will first ask the major ports to fund the VRS as much as they can on their own. If there are more applicants, it would permit inter-port transfer of funds from surplus to struggling ports. This would be in the form of so ft loans from cash-surplus ports to deficient ports at ``mutually-acceptable terms and conditions'', the officials said.

The improved efficiency in port operations arising out of a cut in labour force and savings in salary due to the VRS will more than nullify the burden of taking loans on soft terms for funding the scheme, the officials said.

Once the port efficiency improves with labour reduction, officials expect some of the transhipment traffic to shift from the Colombo port to the Indian ports, especially Chennai and Jawaharlal Nehru ports, which are being developed as hub ports to accomm odate large mainline vessels, saving millions of dollars in the process.

According to officials, this increased activity will bring in more employment opportunities for workers who are either illiterate or semi-skilled.

As per the existing VRS, the major ports were paying one-and-a-half months salary for every year of completed service or for every year of left-over service, whichever is lower. So far, about 10,000 workers have opted for the VRS introduced in 1992. This scheme is being improved upon to attract more workers by giving a more `handsome package'.

The improved VRS is basically aimed at the younger lot in the age group of 46-55 years. The Government plans to give more incentives for attracting this age group since the older lot will, in any case, soon leave through the natural process of attrition on attaining superannuation, the officials said.

The Surface Transport Ministry is yet to establish the optimum size of labour at major ports, which currently stands at a whopping 97,00O. Ports such as Paradip and Visakhapatnam have commissioned studies by National Institute of Port Management and Nati onal Productivity Council to know the optimum workforce required at the ports.

Some other ports are conducting their own internal studies to know the optimum strength to improve efficiency in operations.

The officials point out that both the workers and the management will stand to gain if the workforce is brought down to a more manageable level. Efficiency in operations will improve the long-term prosperity of workers. On the management side, it will im prove the competitive edge of Indian exports, benefiting the country in terms of trade. In all, it would be a win-win situation, they observe.