Advise Defence Ministry To Hold Decision To Convert Ordnance Factories Into Corporation

Implement our proposals - AIDEF, INDWF & BPMS approach Parliamentary Standing Committee on Defence

Posted : 01 April, 2021
Author : Admin
Advise Defence Ministry To Hold Decision To Convert Ordnance Factories Into Corporation

After lodging a statutory complaint against the Secretary(DP) for violation of the conciliation settlement with the Chief Labour Commissioner(C) the Federations of Defence Civilian Employees of Ordnance Factories have now approached the Defence Parliamentary Standing Committee. www.indianpsu.com had earlier reported that the Parliamentary Standing Committee have cautioned the  Ministry of Defence that it should weigh all the pros and cons in favour of OFB before arriving at any finality on the findings of the consultant appointed for  the conversion of OFB in to a Corporation/PSU. Taking advantage of the observations/recommendations made by the Parliamentary Standing Committee on Defence the Federations of the Defence Civilian Employees have decided to onceagain approach the Parliamentary Standing Committee. Already the Federations are running from Pillar to post to halt the government decision to Corporatise the Ordnance Factories. They have already approached the Prime Minister, the National Security Advisor, Chief of Defence Staff and the Defence Minister, who is the Chairman of the Empowered Group of Ministers Committee. However, there is no fruitful result from any corner. In their complaint to the CLC(C) they have stated that they will be forced to revivie the  indefinite strike which they have deferred after the conciliation settlement reached on 09/10/2020.

www.indianpsu.com has accessed a copy of the representation which the AIDEF, INDWF & BPMS have jointly submitted to Jual Oram, the Chairman of the Parliamentary Standing Committee on Defence through email. Copy of the representation is endorsed to all the MPs, who are members of the Parliamentary Standing Committee on Defence. Incidentally Congress leader Rahul Gandhi also is a member of the Parliamentary Standing Committee. The relevant portion of the representation submitted to the Parliamentary Standing Committee on Defence is reproduced here for the benefit of our readers. 

After the conciliation settlement two meetings were held with the Federations to discuss about the strike demands and in both the meetings the Secretary(DP) asked the Federations to submit an alternative proposal/robust proposal for continuing the Ordnance Factories as a Govt. organisation in the present setup itself. The Federations have submitted the following two proposals to Secretary(DP). 

1) Alternative and viable proposal for restructuring of OFB to achieve Rs.30,000 Crore Production target during the next 5 years within the Govt. setup vide letter dtd. 20/11/2020. 

2) The Federations on 12/02/2021 submitted a robust proposal for strengthening the OFB in the present Govt. setup. Copies of all these letters were also endorsed to the CLC(C). 
Subsequently a meeting of the EGOM  was held on 02/03/2021 and in the presentation made by the Secretary(DP) before the EGOM both the above proposals of the Federations were not brought to the notice of the EGOM. This is totally unjustified and we fail to understand why the above proposals of the Federations were hidden from the EGOM. 
It is seen from the minutes of the  22nd report of the Standing Committee on Defence that on 18/02/2021 a presentation was made before the Parliamentary Standing Committee, in which  the DDP has conveyed the decision of the Government to Corporatise the Ordnance Factories. In this presentation also the alternative proposals given by the Federations for continuing the Ordnance Factories in the present set up was not brought to the notice of the Parliamentary Standing Committee by the officials of DDP. We feel it is a serious lapse/mistake  on the part of the DDP officials hiding the factual position. Why the DDP officials have blacked out our proposals from the Parliamentary Standing Committee. The DDP officials owe an explanation in this regard to the Parliamentary Standing Committee. 

The Parliamentary Standing Committee has rightly cautioned the DDP as follows:

“The Committee recommended that the details of the conversion of the Ordnance Factory Board in to one or more than one 100% Govt. owned Corporate entities be shared with them and the Ministry should weigh all the pros and cons in favour of OFB before arriving at any finality on the findings of the consultant appointed for this conversion process”
Sir, according to us the DDP has not at all weighed the pros and cons in favour of OFB  in case the OFB is Corporatised. The MoD/ DDP has gone back from their own statement made before the Parliamentary Standing Committee on Defence. In this regard the extract of the  Parliamentary Standing Committee report of the 14th Lok Sabha (2005 – 2006) is reproduced below for your kind ready reference.

Views of  the  Parliamentary Standing committee  on Ordnance Factories.

Parliament  Standing  committee,  14th  Lok Sabha (2005-06)  analyzed  the  merits  and  demerits  of  OFB.  When they  asked  MoD  on  the  same,  MoD  replied. 
“Ordnance  Factories  function  as  a  Government  Department  and  are  accordingly  governed  by the  applicable  rules  and  regulations.  As  an  established  National  Policy,  Ordnance  Factories  are  also  required  to maintain  idle  capacities  to  take  care  of  surge  demand  in  emergent  war  situation.  In  a purely  commercial  term,  maintaining  idle  capacity  would  be detrimental  to  the  business  interest  of  the company (PSU) and  would  appear  to be a  reason  for  low  performance  in  terms  of  turnover  and  profits.  
In turn, it would also place such DPSU’s in disadvantageous position in acompetitive  environment”.

Conclusion

In our Memorandum submitted to your honour on 26/08/2020 we have explained in details about the ill effects of this to the Defence preparedness of our country and National Security in case the Ordnance Factories are Corporatised (copy of our Memorandum dtd. 26/08/2020 is enclosed for ready reference).

Therefore we take this opportunity to once again appeal to your honour and also all the Hon’ble Members of the  Parliamentary Standing Committee on Defence to advise the Ministry of Defence to put on hold its decision to convert the Ordnance Factories in to a Corporation/Multiple Corporations and to implement the two alternative proposals given by the Federations to the Secretary(DP) to strengthen the OFB Organisation in the present Govt. set up itself. In this regard to enable us to put forth our views before your honour, it is requested that two representatives of each of the  three Recognised Federations (AIDEF, INDWF & BPMS) may please be given an appointment to meet the Committee in person at a date and time and place convenient to the Committee.
 
www.indianpsu.com contacted C.Srikumar and asked him whether the Federations are planning to meet the Members of the Parliamentary Standing Committee. He stated that the representations addressed to the Chairman of the Parliamentary Standing Committee have already been mailed to all the Members of the Standing Committee including Rahul Gandhi and Sharad Pawar. They have asked for an appointment with the Standing Committee and are expecting a favourable response from the  Chairman of the Committee. The struggle against Corporatisation of OFB will be further intensified and depending upon the developments the Federations have already informed the CLC© that they will be forced to revive the deferred indefinite strike. In the meantime protest programmes in all the Ordnance Factories will continue.