Corporatisation of the OFB has been on the government’s agenda for long, but several employee unions have objected to the move. Moving ahead with its plan for corporatisation of ordnance factories, the government has constituted an Empowered Group of Ministers (EGoM), headed by Defence Minister Rajnath Singh, to oversee the process.
The Defence Ministry said in a statement on Friday that “consequent to the decision of the government” to convert the Ordnance Factory Board (OFB), which is “a subordinate office” of the Defence Ministry, “into one or more than one 100 per cent government owned corporate entities”, the government has constituted an EGoM headed by Singh “to oversee and guide the entire process, including transition support and redeployment plan of employees while safeguarding their wages and retirement benefits”.
The other ministers who will be part of EGoM are Home Minister Amit Shah, Finance Minister Nirmala Sitharaman, Law Minister Ravi Shankar Prasad, Minister of State for Labour and Employment Santosh Kumar Gangwar and Minister of State for Personnel, Public Grievance and Pension Jitendra Singh.
According to its Terms of Reference, the EGoM will decide whether the OFB should be converted into a single Defence Public Sector Undertaking (DPSU) or multiple DPSUs. It will also look into issues related to various categories of employees, including protection of their salary and pension of existing employees.
The EGoM has also been tasked with looking into the financial support that may be provided to the single or multiple DPSUs and to make them economically viable and self-reliant; grandfathering of orders already being executed by OFB or for which facilities are created in OFB; and decide about the treatment for land assets of OFB.
The ministry said that the decision has been communicated to the OFB and the federations, unions, association at the board, factory and unit levels, “and they have been requested to place all their suggestions, issues and concerns relating to corporatisation of OFB before the EGoM”.
Corporatisation of the OFB has been on the government’s agenda for long, but several employee unions have objected to the move. Three unions have threatened to go on a nationwide strike from October 12.