India’s FinMin questioned over LIC’s food coupon scheme

This is an interesting Press Release from PIB.

LIC has started giving its employees Sodexo food coupons as an incentive. It seems from the press release that some members of Rajya Sabna raised questions (on 15 Mar 20110 over whether this was a scam as well , criteria for selection etc.

Minister of State for Finance, Mr Namo Narain Meena clarified there is no scam:

The Life Insurance Corporation of India (LIC) has informed that it has introduced a scheme of providing food coupons to its employees with effect from 01.09.2010.  The amount spent on the scheme and the payment made to M/s Sodexo SVC India Pvt. Ltd. for food coupons from September, 2010 to December, 2010 is as under:

Month Amount (Rs. Crore)
September, 2010 11.53
October, 2010 10.78
November, 2010 12.70
December, 2010 13.38

LIC has reported that there is no scam and scheme of food coupon has been introduced with the view to increase employees satisfaction as motivation tools which is manifested in team-work, building client relationship and idea generation.

LIC has intimated that a committee was constituted to evaluate and select the service provider for supply of food coupons.  The committee finalized the service provider M/s Sodexo SVC on the basis of the network affiliates, financial strength, market presence, existing cliental base and quality of service delivery on pan India basis.  Regarding the rates, LIC informed that the coupons are issued on face value with no service or delivery charges being levied by the vendor.

 The news tells you a couple of things.

  • First, this truly is time of scams. People are looking at a scam in any and every government related transaction.
  • Second, there must be real pressure on public sector organisations. Sodexo coupons is a pretty common facility used by many organisations in metros. It is very popular and accepted at quite a few places as cash. It works as a major incentive for most people as it helps them buy groceries, food etc.  Infact it works as a nice nudge as people don’t mind shelling more coupons than cash in these inflationary times. So to see it being questioned in Parliament speaks of the kind of pressure the PSUs must be facing.
  • Third, this blog pointed to this nice research which shows how Indian Public Sector Bank executives are not aggressive in giving private sector credit. One of the reason they say is they are afraid that any bad loan could lead to government inquiry. Well, this LIC example shows how careful one has to be in taking decisions in public sector organisations. As Mr Meena explains there was a committee to decide which company coupons would be given. Some might call this a limitation, but that is how it is going to be.
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7 Responses to “India’s FinMin questioned over LIC’s food coupon scheme”

  1. NK prasad Says:

    In view of the above points,Public can imagine the thiking of member of goverments .Once LIC is giving the food/meal coupon to their employee from their own resources.not from tme government.How the member of the government are taking the incentive /salery/pension etc of public earned money.

  2. Promo Codes India Says:

    really coupons are giving a great releaf to the people in these fluctuating budget time, cost of living is increasing day by day and the people are unable to pay their security needs, its becoming very hard for the people save some thing in their future life. These coupons are giving a great releaf.

  3. ami Says:

    Its a great step towards the motivation of the LIC staff.A Great organisation can do a great work towards satisfaction of its staff.The ministers are enjoying our hard earned money,eating this money as if it belong to them,Just learn from LIC , how it is managing the things in perfect manner.

  4. bulk food storage containers Says:

    bulk food storage containers…

    [...]India’s FinMin questioned over LIC’s food coupon scheme « Mostly Economics[...]…

  5. MANOJ Says:

    it is very beautiful scheme for employee and nowadays employees are not taking unnecessary leave and they faith in LIC.

  6. va thevar Says:

    earlier people usu to come late after taking breakfast at home and now people take breakfast after coming to office in office.this is only difference we could achieve after spending 336 crores in meals coupons of widows money and reducing bonus to policy holders who are the most effected lots.

  7. Aniruddha Says:

    It is wonderful that the parliamentarians are questioning the motives of as transparent organisation as LIC.They should first quetion private insurance companies whether they are procuring insurance from rural sector as per statutory norms of IRDA and if not what penalty has been imposed on them by IRDA ?

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