Private airport operators asked to pay Rs423 crore as compensation

New Delhi: Nearly three years after the Union government privatized the airports in New Delhi and Mumbai, the consortia running them have been told to provide for at least Rs420 crore as employee compensation as most workers, earlier employed by the government, have declined to work for the new companies.
The GMR Infrastructure Ltd-led consortium of Delhi International Airport Pvt. Ltd (DIAL), which now runs the Indira Gandhi International Airport, and GVK Power and Infrastructure Ltd-run Mumbai International Airport Pvt. Ltd (Mial), which operates the Chhatrapati Shivaji International Airport, will pay Rs209 crore and Rs214 crore, respectively, as a result.
The May 2006 privatization agreement stipulated that the consortia offer employment to at least 60% of the workforce and pay for a voluntary retirement scheme, or VRS, to those who choose not to work under the new managements. Less than 5% of the employees have agreed to work for DIAL or Mial, as the two airport companies are called in short, and, this month, at least 4,000 of them will return to the state-run Airports Authority of India, or AAI, the country’s airports regulator that also runs most of the airports through an eponymous unit.
AAI has floated a VRS for the employees who have decided to stay with it and not joined the private airport consortia.
“Based on the finalized VRS, the estimated amount payable by Mial works out to Rs214 crore. However, this may be considered as provisional and may vary depending upon the actuals and effect of pay revision due with effect from 1 January 2007,” AAI chairman V.P. Agrawal said in a letter to Sanjay Reddy, managing director of Mial, earlier last month.
“I, therefore, request you to personally look into the matter and make necessary arrangements of funds to remit this amount to AAI at the earliest,”Agrawal added. The letter was reviewed by Mint. The AAI chairman also asked DIAL to remit Rs209 crore in a letter to its managing director Kiran Kumar Grandhi.
The VRS scheme for these public sector employees has already been launched by AAI in March and ends by mid-April.
06/04/09 Tarun Shukla/Livemint

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Categories: Airports Apr 2009