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Goa's VRS may pull it out of fiscal quagmire

Sandesh Prabhudesai in Panaji

The voluntary retirement scheme, or VRS, introduced for the first time in the country by Goa, may help in pulling out the tiny tourist state from the financial crisis only if the entire government workforce is reorganised in a planned manner.

"The prime objective of the scheme is to downsize the government so as to control revenue deficit," said Vijay Madan, the state finance secretary. He has issued a detailed memorandum in this regard on 15 May, according to which government employees have to opt for the VRS within three months.

Unlike the regular scheme for voluntary retirement after 15 years of service, the recent scheme allows to seek voluntary retirement after 10 years of service. Those who will benefit the most are the ones who have five years of service left. These employees have been offered 30 per cent of the balance salary by calculating average salary of the last 10 months and calculating eight years of service for pension benefits.

Employees left with 25 years of service, however, would get 480 days plus 12 days' salary per completed year of service.

It is not only the employees working in government departments or the police force, but also those working in autonomous state-run corporations and teachers in the aided schools and colleges are allowed to seek the benefit.

"Our first target group is around 300-surplus teachers," disclosed one official.

With government service still being considered a status symbol in the Goan society, the number of government employees is rising every year. Despite imposing a moratorium on fresh recruitment without cabinet approval a decade ago, the numbers are rising.

Statistics show that every 30th Goan is employed by the government. The state shells out 58 per cent of its revenue expenditure (over Rs 4 billion) on salaries. In order to appease the 'vote bank', no political party ever opposed the total implementation of the Fifth Pay Commission recommendations.

Bharatiya Janata Party leader Manohar Parrikar, however, succeeded in pushing the idea of the VRS. The plan seemed to catch Chief Minister Francisco Sardinha's fancy.

With a plan to abolish 40 per cent posts through VRS, the chief minister has proposed a 'leaner government, younger government' scheme.

Before recruitment, the young brigade will have to undergo an 18-month course at the Staff Recruitment and Training School learning all aspects of government administration, laws, governance and management as well as computer training. They shall get a monthly stipend of Rs 1,500 during training.

"It all depends on the response we get," said Rajib Sen, joint secretary in the state finance ministry.

The state expects an expenditure of around Rs 200 million for an estimated 1,000 employees, who it believes will opt for the VRS. The state is planning to take a loan to implement the VRS.

However, the government expects to repay the loan in five years, after which it would be an annual saving of at least Rs 60 million. "The state would definitely benefit in the long run though the amount of the VRS payment will initially outweigh the salary amount," clarified Sen.

However, it remains to be seen how successful would the scheme be considering that vacant posts are sought to be filled up by politicians themselves, who are out to appease party workers, relatives and friends.

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