Staff protest hits RBI activity in morning, normalcy later

Employees' stir against Centre's intervention in RBI's autonomy and pension-related issues

About 17,000 employees of the Reserve Bank of India (RBI) went on mass casual leave on Thursday, affecting dealings in the bond markets in the morning. The operations were back to nornal by the end of the day.

The RBI employees and officers were protesting against the Centre's intervention in the autonomy of the central bank and to sort pension-related issues.

Banking sources said the activity in early morning in segments such as Real Time Gross Settlement (RTGS) was affected by the agitation. But later, the operations at RBI’s liquidity management facility (LAF) went through smoothly with volume of about Rs 20,000 crore.  

The volumes in the government market were higher at Rs 13,240 crore, compared with Rs 9,340 crore on Wednesday, according to Clearing Corporation of India (CCIL) data.  Volumes in bond markets had dipped on Wednesday as traders had turned cautious ahead of the agitation.

Suryakant Mahadik, leader of the United Forum of Reserve Bank Officers and Employees, said the agitation was successful. But after 11 am, clearing operations were done in a normal manner to ensure least inconvenience to public, he said. As a step to further agitation, the employees will approach members of Parliament to garner support for their pension demands, Mahadik said.

RBI in a statement said there were some interruptions to clearing and settlement operations of the bank during opening hours of the day. But the management engaged with representatives of the United Forum and persuaded them in largely restoring normalcy, including in the operations relating to RTGS and National Electronic Funds Transfer (NEFT) systems. A majority of the employees were on mass casual leave responding to a call given by the United Forum of Reserve Bank Officers and Employees. This led to thin attendance across various offices of the central bank, RBI said.

Samir Ghosh, general secretary of All India Reserve Bank Employees Association (AIRBEA), said employees do not want to cause any inconvenience to the market, or to common people. They were just sharing resentment by going on a silent mass casual leave for a day. The resentment could turn into a strike in future if their demands continued to remain unmet, Ghosh said.

One long-pending issue RBI has been trying to sort with the government is pensions.  RBI wants periodic revision of the pensions for its retired employees, as is the system in other central government organisations. The government does not want to play ball.

The size of the pension corpus was pegged at Rs 1,400 crore which is built internally. The demand for improvement in terms and conditions did not have any implication on government finances, RBI officials had said.

In 2003, then governor Bimal Jalan had allowed pension updation, a system similar to that enjoyed by central government employees, effective for those who formally retired prior to November 1, 1997. However, the government objected citing it couldn't be implemented without suitably amending the RBI Pension Regulation Act.

The central board of RBI withdrew the scheme in 2008, leading employees to go on strike.  It is to be noted that the pension is paid from RBI’s own corpus for employees and the central government’s finances remain unaffected.

RBI Governor Raghuram Rajan said in the central bank's annual report in August that satisfied staff was a key factor in RBI’s success and earlier there was no problem attracting junior officers to the central bank. Union leaders allege RBI officials have repeatedly told the government that the central bank has adequate funds to take care of pension updation, and in no way will the central government be burdened, but the finance ministry is not ready to listen.

“RBI’s central board in 2011 was in favour of the updation and the board decided they will give an advisory to the government that we have sufficient corpus, but the government is just standing in the way, saying it is not sustainable,” said Ghosh of AIRBEA.