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Ministry weighing options on SAIL retirement age

G. Rambabu

NEW DELHI, Dec. 14

THE Ministry of Steel is unlikely to pressure the Steel Authority of India Ltd (SAIL) to roll back the retirement age for its executives from 60 years to 58 years.

According to highly placed sources, although the Minister for Steel, Mr B.K. Tripathi, was keen on the proposal, as it would result in savings for the ailing PSU, he did not want to antagonise the Navratna company board, which had at its recent meeting r ejected the proposal.

The sources said the Government had already taken a decision not to revoke any of the powers delegated to SAIL under the `Navratna' package which provided autonomy to select blue-chip public sector enterprise, despite their heavy losses.

``The question of revoking the autonomy and interfering in the decisions of the board would only arise if it is found that the company's finances have gone completely off track, making it chronically sick. But now that the restructuring package is being implemented and brighter days are foreseen for the company, the Ministry wants to keep its hands off,'' the sources said.

However, a final decision was yet to be taken, the sources pointed out. The Ministry also has the option to overrule the board decision and make it binding on the company to reduce the retirement age.

The Government, being the major shareholder in the company, can overturn any decision of the board and place the issue before the Union Cabinet for final approval.

Quite a few PSUs including Air India, Indian Airlines and ITDC and Hindustan Steel Construction Ltd have rolled back the retirement age, and it is felt that SAIL should not be made an exception.

The company board has in its communication to the Ministry argued that by reducing the retirement age to 58 years, it would have to bear a bigger burden of paying retirement benefits, which could put a strain on its finances.

The Ministry, however, felt that if these employees opted for the Voluntary Retirement Scheme and the long overdue wage revision, the resource outgo would be much greater.

As it is, the wage revision is due since 1997. The company has to decide on the timing and the capacity to absorb the incremental increase which will be brought about by the revision.

The present financial position is not strong enough to absorb this, unless resource generation takes place. So it makes more financial sense to roll back the retirement age.