Preventive vigilance is a more effective tool of good governance at public sector institutions compared with punitive or detective vigilance, Reserve Bank of India (RBI) governor Urjit Patel said on Thursday.
Preventive vigilance is a more effective tool of good governance at public sector institutions compared with punitive or detective vigilance, Reserve Bank of India (RBI) governor Urjit Patel said on Thursday. He was speaking at the Central Vigilance Commission in Delhi.
Punitive vigilance is difficult in a public sector institution as rewards are low to start with, thereby limiting the possibility of downward revisions, he said. As a result, disciplinary actions that limit chances of career progression are often the preferred punishment.
“However, this has the misfortune of demotivating employees beyond the point of their career when punitive vigilance action is undertaken. This could, in principle, be dealt with a ‘golden handshake’. However, the insurance that public sector jobs offer is often a key attractive feature of these jobs given the lack of significant upside financial rewards,” Patel said.
While there are ways to fine-tune pecuniary incentives and career-based rewards for greater effectiveness even within these constraints, their ‘bite’ is not as strong as in the private sector, he said.
The central bank follows a system of preventive vigilance internally and has taken several steps in this direction, Patel said, adding that over the last four years, the share of vigilance cases against RBI employees vis-à-vis its total staff strength stood on average at 0.004%.
“Further, in terms of complaint cases received against RBI/RBI employees over this same period, the percentage that required punitive vigilance action stood on average at 0.081%.”