Kratoh: Smarah: / Deeds will be remembered

A news report in Economic Times ( 27 March 2017 ) reads :

Shri Adityanath has asked all departments to come up with a plan to prioritise tasks that can be delivered within the first 100 days of the government , to reflect a “ visible change “ on the ground

People of this country are fed up of platitudes and “ motherhood is good “ type of promises !

They are demanding that the Ministers / Secretaries , set for themselves individually , ( and not for their departments collectively ) , TARGETS which are QUANTIFIABLE / TIME BOUND / MEASURABLE

Dear  Shri  Adityanathji  :

You may want to ask your officers to draw up TARGETS as explained in my following email to Shri Jaitleyji ( - who has made a beginning by introducing OUTCOME BUDGET , starting 2017-18, – and for which , he deserves congratulations ! )

5 December 2014

BUDGETING     BY    OBJECTIVES

Dear Shri Jaitleyji ,

Come Feb 2015 and you will present your Budget in Lok Sabha

You will allocate thousands of crores of rupees to different ministries , for spending during 2015-16

You may even increase / decrease their allocations based on , to what extent ( % ) did they manage to actually " spend " their current year's allocations

The one and only emphasis is on " spending " !

As usual , no MP will ask :

"  But , what exactly did the Minister concerned achieve by spending this money  ?

What physical / measureable targets did the Minister succeed in reaching / exceeding , with that money  ?

Where / What are the OUTPUTS  ?

Why is it that no targets were set in advance, before the start of the year ?

How come , Minister was allowed to shoot first and then draw concentric circles around the hole afterwards ( at the end of the year ) , to claim BULL'S EYE  ?  "

In private sector , shareholders / bankers do not hesitate to sack the CMD / MD / CEO , if he fails to deliver on promised profit

Then , why are Ministers allowed to retain their posts ( - or even get kicked upstairs ! ), despite failing to deliver  ?

Dear Shri Jaitleyji :

MPs should know that YOU cannot answer these questions , simply because , at the time of the Budget Exercise , no physical OUTPUTS  got fixed for each Minister

What did get fixed , were only EXPENDITURE TARGETS  !

Simply because MPs passed the Budget without fixing targets such as following for 31 March 2015 :

*  Finance Minister

   *   GDP ..... 6 % ............ [ 10 % improvement ]

   *   CAD.......( -  ) 5 % .....[  20 % improvement ]

*  Commerce Minister

   *   Exports........ $ 350 Billion  ....  [ 10 % improvement  ]

   *   FDI..............$    50 Billion...... [  20 % improvement  ]

*   Railway Minister

    *   Lengths of Tracks...... 125,000 Km.....      [  Up by 10 %  ]

    *   No of Passenger Trains / day..... 10,000... [ Up by 10 % ]

*   Health Minister

   *   Chronic Hunger and Hunger Related Deaths

         8 Million / year .................................... [  Down by 20 %  ]

   *   Under-nourished people..... 200 million..... [ Down by 10 % ]

*   Social Welfare Minister

    *    Dowery Deaths / year....... 8,000...... ......[  Down by 10 %  ]

    *    People without Toilets........ 500 Million....  [ Down by  20 % ]

*   Agriculture Minister

    *    Farmers Suicide/ year..... .. 14,000...............  [ Down by 20 %  ]

    *    Food Grain rotting / year..... 5 Million tons.....  [ Down by 20 %   ]

So on and so forth for each Minister

Some caution / suggestions :

*    Ignore the numbers given above. I could be factually wrong

*    Focus on the concept of " Management by Objectives "

*    Overcome the fear of " failure to meet the targets ".

*    Overcome the fear of " being ridiculed " !

*    Don't chop off the neck that dares to stick out  !

*    Only failure is , not fixing the targets  !

*    Actual vs Targeted achievements must be measured , on an ongoing

      basis , by totally independent THIRD PARTY agencies

      Ministers / Finance Minister and these Agencies , must agree in advance , how the

      Agencies will go about " measuring " the Actual Achievements

      The method of measurement must be transparent and well publicized

      in advance

      Agencies shall have no role in fixing of Annual Targets

      That is best done by the Prime Minister - the CEO , MakeInIndia

*    There must be at least 10 performance parameters for each Minister

*    Parameters themselves could be selected / prioritized , based on an

      ONLINE PUBLIC SURVEY / OPINION POLL , from Govt web site

*    If conducting such an ONLINE POLL for the forthcoming budget is

      too late , same could be done on a printed form , by current MPs /

      MLAs / Rajya Sabha Members

*    Results of the SURVEY / POLL , must be published

30  March  2017

www.hemenparekh.in / blogs 

Best out of a Bad Bargain ?

Yesterday Supreme Court decided that vehicles conforming to BS 3 emission standards , cannot be sold / registered , starting 01 April 2017

Vehicle manufacturers are stuck with an inventory of some 8 lakh BS 3 vehicles , valued at Rs 14,000 crore

Manufacturers are left with the following 3 options :

·         Scrap the BS 3 vehicles ( after salvaging whatever parts they can )

·         Upgrade the vehicles to meet BS 4 standard (  technically doubtful  )

·         Export vehicles to countries where these are still acceptable ( very doubtful  )

Allow me to offer a 4^th option , for serious consideration by :

·         Vehicle Manufacturers / their Associations / Car Dealers

·         Central / State Governments

·         The Supreme Court

My following suggestion is based on these  assumptions :

·         BS 3 vehicles are less polluting than BS1 / BS 2 , vehicles

·         Out of our current vehicle population of some 200 million vehicles , at least 10 million vehicles still polluting our climate, are only BS1 / BS 2 compliant

Out of these , Shri Nitin Gadkariji wants to replace 6 million ( of course, with BS 4 / BS 6 vehicles ) , by 2020 , under a “ Old Vehicle Replacement Scheme “ , which offers,

     #  heavy discount ( in purchase price ) to the buyer ( who surrenders his OLD /    POLLUTING vehicle to a government approved / authorised scrap dealer )

     #  heavy subsidy to the Vehicle Manufacturers for replacing those old vehicles

I suggest that :

·         Vehicle Manufacturers Association file a REVIEW PETITION in the Supreme Court

·         Review Petition would request Supreme Court to modify its order as follows :

      #  Inventory of 8 lakh BS 3 vehicles can be sold at a  discount to buyers who come forward to get their old BS 1 / BS 2 vehicles replaced with this inventory

        

      #  Discounts ( over current sale price ) will be :

·         25 % for vehicles which are 5 years old

·         50 % for vehicles which are 10 years old

·         75 % for vehicles which are 15 years old

      #  These 8 lakh BS 3 vehicles can only be sold to the current owners of old BS 1 / BS 2 vehicles , which are still plying on our roads

      #   These can be sold only when the buyer hands over ( a kind of “ Exchange Scheme “ ) , his old vehicle , along with the Registration Book , to the Dealer

     #    Buyers will also sign an undertaking that he shall not RE-SELL such a replaced BS 3 vehicle for 5 years to anyone else

·         Considering that lesser the number of “ Privately Owned Cars “ and more the number of “ Public Cars / Buses “ as taxies  on the roads , means lesser the pollution , Supreme Court should also allow sale of these 8 lakh BS 3 vehicles to Taxi operators / Fleet operators / Car Transport Service Aggregators etc , at a flat 25 % discount ( without exchange ) .

I estimate that this relaxation would remove from our roads , some 20 lakh “ Privately Owned Cars “ , whose utilization is hardly 5 % of the time !

·         Apart from this , Supreme Court may direct that the Central government and the State governments , replace all of their own old BS1 / BS 2 , with the inventory of BS 3 vehicles lying with the manufacturers

For such replacement , manufacturers to give 50 % discount to the governments

Whereas , Shri Gadkariji’s OLD VEHICLE REPLACEMENT SCHEME , has met with a lot of opposition from both , the vehicle manufacturers as well as the old car owners , I believe my proposal would be welcomed by all concerned ( for the obvious benefit that each party stands to reap ! )

Dear Shri Gadkariji :

A phone call from you to SIAM Secretary , telling him of your willingness to make NDA government a party to the REVIEW PETITION , would provide a great relief !

30  March  2017

www.hemenparekh.in / blogs

The Next Simplification : ARM ?

Most advanced countries have just  ONE TAX  for sale of GOODS and SERVICES

We will introduce our own GST ( Goods and Services Tax ) from 1^st July , across entire country

GST will replace some 70 + different taxes currently in force , for different products / services and in different States

This will lead to :

·         Higher collection of tax

·         Increase in productivity

·         Reduction in litigation

·         Simplified administering…etc

To further improve “ Ease of Doing Business “ ( - and attract many more foreign companies to set up their Manufacturing / Marketing operations here ) , I suggest NDA government follow this up with , introduction of :

·         ARM ( Allowances and Reimbursements Merger )  Act

Most economically advanced countries just pay consolidated “ SALARY “ ! Nothing else !

As against this ( utter simplicity ) , we have , one or more of the following elements of PAY STRUCTURE , depending upon factors such as,

·         Geographical location

·         Industry-sector ( organized vs unorganized )

·         Public Vs Private

These elements are :

·         Basic Salary ( in a Scale of rising minimum annual increments )

·         Dearness Allowance – DA ( usually linked to CPI / WPI rise )

·         House Rent Allowance – HRA ( varies from city to city )

·         Transport Allowance / Conveyance Allowance / Petrol Reimbursement

·         Food Allowance ( Coupons ) / Lunch Allowance

·         Leave Travel Allowance

·         Medical Allowance / Reimbursement  / Insurance Premium Reimbursement

·         Telephone Reimbursement

·         Hardship Allowance / Hazardous Jobs Allowance

·         Entertainment Allowance  /  Club Membership Fees

·         Driver’s - Gardener’s  Salary Reimbursement / Servant Allowance

·         Double Machine Operation Allowance

·         Milk Allowance ( - it exists ! )

·         Temporary Posting Allowance

·         Children's Education Allowance

*   Outstation Allowance

*   Washing Allowance / Soft Furnishings Reimbursement

*   Shift Allowance ( if required to work in second shift )

*   Overtime Wages @ 250 % of normal wages

*   Compensatory Working Allowance

The list is by no means, exhaustive !

And do not overlook the “ Monetary Value “ of the following :

*   Casual Leave / Sick Leave / Accident Leave

*   Accumulation / Encashment of PL

*   Paid Holidays

*   Supply of Uniforms / Safety Shoes / Umbrellas etc

*   Providing of Creche ( for Employee's Children )

*   Maternity Leave of 26 weeks

*   Contribution to ESIS / EPF / Gratuity  … etc

And , if juggling all of these was not difficult enough , a news report in Times of India ( 29 March 2017 ) adds following further complications :

“ GST would be payable if there is supply of free goods or services to an employee exceeding the stipulated sum

If an employee avails of a company asset for personal use, it would trigger GST

Input tax credit will not be available on supply of various facilities to employees, including life and health insurance “

 Gifts to staff worth up to Rs 50k will be GST-exempt

[ http://timesofindia.indiatimes.com/business/india-business/gifts-to-staff-worth-up-to-rs-50k-will-be-gst-exempt/articleshow/57881920.cms ]

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I hope harried HR Managers would support my suggestion to implement ARM ( - to the extent possible )

ARM would leave them with more time to attend to the tasks of Talent Acquisition / Training / Human Resource Development

What shape should the New Compensation Structure take ( after ARM ? )

This could be the subject matter for debates / essays / case-studies etc among students specializing in HR at Management Colleges

By offering to enrich their Professional lives , ARM makes them, a “ Party with Vested Interests “ !

PS :

Robots do not ask for ANY of these , nor form a UNION to submit a “ CHARTER OF DEMAND “

29  March  2017

www.hemenparekh.in / blogs