National carrier Air India in order to rationalise surplus manpower, has asked the government for an additional Rs. 1,100 crore to implement the voluntary retirement scheme. The voluntary retirement scheme is aimed at reducing the headcount by 5,000 which many believe is an unrealistic number.
The airline seeks the amount in addition to the Rs. 10,600 crore that it is supposed to get this year. A portion of the amount will come from the government as budgetary support of Rs. 4,000, while the other Rs. 6,600 crore as a portion of the bailout package for the financially struggling airline.
One of the senior AI official said, “We have asked the ministry of civil aviation for Rs 1,100 crore to implementVRS in Air India and they in turn will talk to finance ministry about it. The amount is needed so that we can make the compensation package attractive in order to bring down staff strength by 5,000”. The official even admitted that it was an over ambitious number and that there is a thought within the airline about lowering the VRS target of 5,000 employees.
The VRS will be targeted at the AI employees who have completed 15 years of service or are 40 years of age. They would be offered compensation which is equivalent to the salary 35 days for each completed tear of service.