In the year 2000 a popular Tamil movie showed how a Government job was a necessary qualification to seek the hand of a girl in marriage.
This movie was such a super hit that it got remade in Hindi subsequently. It’s theme and popularity is such that on the day the new Government took oath in 2014 this movie was played over and over by different channels on television. It is but, only a movie by a Director with vivid imagination.
The provident fund is something that has captured the imagination of the average factory worker who makes it a precondition for choosing a factory to marry. (Iteration being an issue applicable to certain sections of business, to a large extent in India, even today).
The reasons for this choice are several.
- a) A job with a PF provision is perceived to be like a Government job by many workers.
- b) Some workers believe that the pay will actually be more if the organization is covered under PF.
- c) Some want it for its real intent of benefitting from its annuity payback.
PF is clearly part of the Cost To Company, both employer and employee contribution taken into consideration.
Thus PF is certainly a necessity. But it requires reforms to address on the ground realities such as below. Under unavoidable circumstances, some leeway should be provided.
Around 2009 global recession hits, small and medium industries are scrambling to make ends meet. Payments to the PF department cannot be delayed. They slap notices and attach bank accounts of those businesses delaying the payment. Letters of request to allow some time expressing difficulty to make PF payments on time go unheeded.
There is a provision for the factory to submit the list of creditors to the PF office along with relevant documents to prove the dues. The PF department in turn collects the dues of the factory in a matter of a couple of days. It is simple. The PF Department will intimate the factory’s clients that their bank accounts will be attached if the dues of the businessman is not paid directly to the PF department immediately. The PF due, interest and penalty having been collected, everything should be hunky dory and the title credits should roll right? Wrong. Picture abhi baki hei…
This whole fiasco from the date PF payments become due till it has been collected in the above story has taken about six months. In the process there is a Police Complaint filed by the PF department. On receipt of the dues by the PF department, the factory requests the PF department and a letter intimating the Police Station of the no due position of the factory is issued addressed to the said Police Station. At least now, is the movie going to end? Of course not. This is not an art movie. Spicy twists and turns are required before it can end…
The manufacturer has to go to The Court and prove that while there was a due to the PF Department long ago, the payment along with interest and penalty has been made, that the PF Department has written to the Police Department regarding the same, receipt of acknowledge of the said letter by the Police Department has to be produced, the Police officer who has received the complaint and subsequent no due letters has to appear in Court and testify, The PF Department officials have to appear in the Court and testify to having received all dues. In the meanwhile the businessman has to walk around with an anticipatory bail in the face of the accusation that he has cheated the public. A grave offence, mind you. If the fiasco at the PF office level took six months, the Court proceedings may well conclude in about six years.
And the real The End comes here. The beginning of the question, why did I make in India.
The New Beginning
India has great potential in the field of manufacturing and others as well. Make in India will happen and in a big way*. But will it happen without the ground realities being addressed, frustrating the makers in India in the process or will we make the reforms to help make in India an enjoyable experience, is the question.
*Please see reply to comments in the blog. manufactureinindiablog.wordpress.com