American Consultancy firm ‘Deloitte’ reviews Gazetted Staff Strength on IR

American consultancy firm Deloitte has begun assessing the staff strength of Indian Railways to understand whether the national transporter requires any reduction in its work force. Railways over the years has become overly centralized, top heavy and hierarchical organization which is suffering from ‘departmentalism’.

Gaz OffOne of the world’s largest HR Audit and Consultancy firm Deloitte is currently reviewing the staff strength requirement in gazetted level services of Indian Railways. The Railways has over 13 lakh employees in various departments of which about 18,000 gazetted officers are serving in categories ‘A’ and ‘B’ jobs.
Railways has kicked off the restructuring exercise with a direction for pruning additional officers in the ‘top-heavy’ organization by appointing a private firm Deloitte to suggest ways to right size its manpower of gazetted officers.
Deilotte, which will work in coordination with National Academy of Indian Railways Vadodara, will submit its report by March 2016.With hiring a private HR audit firm, the national transporter has taken the first step in its bold decision to rationalize staff strength. The scope of the assessment being carried out by the consultancy points to the possibility of reduction in the strength because the firm has been asked to study such factors which impact the workload. It will also take up study of reduction of workload on account of outsourcing of activities. These areas include technological advancements and outsourcing as well, said a source.
The private firm will study the functioning of various departments in zonal and divisional headquarters of railways with focus on technological inputs and achievements made in each department. According to high-level sources, the consultancy has been given the task of “studying” technological inputs and advancements made in each department. Likewise, it would be “studying reduction of workload on account of each department”. In recent years, the Railways have outsourced many of its activities.
The task which is aimed at rationalisation of manpower includes suggesting policies to determine “optimum intake” in various jobs. The company will be submitting its report by March 31, 2016. An official said the company will examine the railways’ manpower given the technological development/changes in operational and maintenance practices and suggest optimal level of the staff strength needed in coming years. The company is tasked with estimation of an optimum strength of gazetted officers required for effective discharge of duties to achieve transporter’s goal.Several independent expert committees have observed that staff cost (including pension) is the single most significant expenditure item for the railways, accounting for the lion’s share of total expenditure and have suggested rationalizing the number of employees. Bibek Debroy panel suggested for immediate intervention to right-size the railways’ bench strength which is eating up cash-strapped transporter’s resources.”The employee costs including pension constitute the single largest component of railways, which has further become unmanageable after the sixth pay commission. The seventh pay commission in 2016 would further push up staff costs and pension costs which will have serious financial implications for railways,” the panel said.
Both officers and the trade unions are opposed to recommendations the panel. Trade union leaders Raghaviah (NFIR) and Shivgopal Mishra have declared war against them. However, Railway Minister Suresh Prabhu has been maintaining that Railways is not considering any reduction in the number of employees. Several Trade Unions members highlights that major revenue loss for railways is due to various unworthy tenders and contractor-staff/officer nexus that is leading to drastic outgo of revenues which is one of the major contributor of revenue losses for IR.
Other private companies in contention were Ernst and Young, PWC and KPMG. “The ministry has hired the company through competitive bidding, and reputed companies including PricewaterhouseCoopers, KPMG and Ernst and Young,” Railway spokesperson Anil Saxena.
The exercise gained momentum after the recommendations of Bibek Debroy Committee on Restructuring of Railways. The panel had recommended rationalisation of workforce, regrouping of cadres and disbandment of wings which are involved in non-core activities. It also recommended disbandment of Railway Protection Force (RPF) and the health services. Debroy Committee has also recommended large scale outsourcing in non-core activities. It noted that the present railway board is saddled with excess manpower with total staff strength of 1,107 officers.
It noted that there are seven members, two Director Generals (DG-Health and DG-RPF), one Secretary, 16 Additional Members, 21 Advisors, 94 Executive Directors, 200 Directors/JDs, 250 DDs/USs and 516 Section Officers. Railways is divided into 16 geographical zones employing about 14 lakh people as on date.At a later stage, Railways will also hire a reputed consultant to examine the strength in non-gazetted section to study the system and requirement and see if there is any extra flab, said a senior official.