New Delhi: The Air India pilot union-Indian Commercial Pilots Association (ICPA) has welcomed the Voluntary Retirement Scheme (VRS) of the Centre but warned that it will flop if it is not financially attractive.
A meeting of Group of Ministers (GoM) chaired by Pranab Mukherjee was held on October 28 to discuss the strategies for the turnaround of the national carrier.
The GoM clarified that the turnaround of the airlines cannot be sound without heavy cuts in the wage bill following which the employees were offered attractive VRS which will be partly funded by the government.
A senior officer of the ICPA said that the scheme was good but it should be financially attractive also.
“If the government will fund it partially and other facilities like provident fund and Productivity-linked Incentives (PLI) are added, many employees will accept it,” said the member.
The member added that the scheme can prove a flop show if the PLI is not added to it.
Under this, around Rs 400 crore are expected to be spent on 36, 000 employees of the national carrier.
Presently, Air India has a fleet of 121 aircrafts and nearly 297 employees are employed with each aircraft. However, the government wants to trim it down to 100-150 workers per aircraft.
Air India’s annual wage bill stands at whopping Rs 3,600 crore which it proposes to trim by 40 per under the turnaround plan.
It should be noted that only one percent of the employees had applied for previous VRS as only Provident Fund was added to the salaries while PLI was not included.