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Journalism of Courage
After reporting to the Labour Ministry for nearly five years, the Central Provident Fund Commissioner has been shown the door for proposing radical reforms in PF management, reforms that effectively call for taking PF out of the Labour Ministry and insulating it from politics and red tape.
Ajai Singh, who had just two months of tenure left, made a presentation to the Planning Commission earlier this month in which he suggested that either the Prime Minister’s Office or the Commission itself should take charge of the Employees’ Provident Fund Organisation.
He said that with the old-age security of 4 crore members at stake, PF should not be left to the whims of a ministry like Labour, with its narrow focus.
The shocked ministry learnt of Singh’s proposals only when the Planning Commission asked for its comments, an official spokesman confirmed.
Singh has headed EPFO for 4 years and 10 months and his term was nearing its end. His colleagues said that the suggestions he made were not for ‘‘his own benefit’’ but to ease the path for his successor. The ministry insists that the bureaucrat should have taken it into confidence. ‘‘How could he do that when the whole point is that he had no confidence in the ministry?’’ said a source close to Singh. Singh’s disagreements with the ministry had surfaced recently. He had taken the tough but politically unpopular line that EPFO must live within its means and not pay its members more than its earnings permitted. The trade unions and even the Labour Minister tried to lobby for a higher interest rate but were forced to slash it to 8.5 per cent as EPF rules supported Singh’s stand. But things really went downhill after Singh made a presentation to the Planning Commission on his pet project, Reinventing EPF India. The project, that he initiated in 2001, aims to make the working of EPFO completely transparent, while reducing the role of ministry officials. For example, it will do away with one-on-one relationships so that inspectors will not have the power to arbitrarily harass employers on PF matters.
It will reorganise the system in such a way that a member gets his cheque within 2-3 days of making a claim. If an official drags his feet on an assignment, the computer system will automatically signal that to his superiors. Taken to its logical end, this system would even make the EPF interest rates a mathematical exercise more than a political one as they would be determined purely by what EPFO has earned during the year, not by haggling among the board of trustees. Touching on the risks that this project entailed, Singh reportedly told the Planning Commission that “one needs a champion for this project and unfortunately even the Ministry of Labour does not appreciate just how important it is.” In this context, he suggested that another agency like the PMO should take over monitoring the EPFO. The words came back to haunt Singh. Ministry officials insisted that the strong-willed Commissioner was virtually revolting against the system—and that could not be condoned. Singh’s colleagues insisted that he had not personally criticised anyone. “With falling interest rates, the system faces entirely new challenges,” said one of them. “Singh was merely pointing out that the ministry cannot be ambivalent about what needs to be done.” In fact, the ministry was pretty clear-cut about its thoughts on Singh. The Revenue Service officer was given his marching orders yesterday.
