The All-India Syndicate Bank Staff Association (an affiliate of NOBW and BMS) denounced the views expressed recently that RBI relief to banks was hit by new pension and gratuity policies.

“It is not correct to say that on account of wage revision, hike in gratuity ceiling and pension, banks' profits will decrease”, Mr K. S. Bhat, Secretary of the Association, said.

After five long years the employees got a 17.5 per cent increase in wages (including pension cost and other superannuation benefits), whereas the Central Government employees got a 40 per cent increase, he told Business Line . Employees of the insurance sector also got a hike higher than bank employees, he pointed out.

“Nobody will dispute that the employees of the public sector banks are toiling in branches due to keen competition, reduced manpower and sky-high expectations of the customers,” Mr Bhat said.

According to RBI data, from 2005 to 2010, the manpower has decreased from 4,73,725 to 4,67,262, whereas the business per employee has increased from Rs 3.8 crore to Rs 9.47 crore and profit per employee from Rs 2.23 crore to Rs 5.74 crore, Mr Bhat said.

With the frequent changes in the rate of interest, the cost of funds and interest expended have increased considerably. “This fact cannot be ignored while assessing the situation”. During the same period, the interest expended has increased from Rs 52,464 crore to Rs 1,45,712 crore.

Contrary to this, though the business of public sector banks has increased, the wages as a percentage of total expenses have decreased during 2005 to 2010.

From this, he says, one can infer that even as the businesses of banks are increasing, the workload of employees has been rising with no commensurate increase in salaries. .

Under these circumstances, Mr Bhat asks why see the increase in gratuity and the pension paid to the employees are seen are the sole reason for any future fall in profits of banks.

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