PSGIC trade unions demand blacklisting of E&Y in India

The employees, officers, agents, surveyors, and other professionals working PSGICs have been opposing the report of E&Y. It is strange that the managements have not shared the complete reports with the employees, officers, and other stakeholders and are moving ahead unilaterally

Mumbai: In what can be termed as yet another blow to Ernst & Young, one of the Big Four financial consultancy firms globally, the PSGIC trade unions have demanded for a thorough audit by the Comptroller and Auditor General (CAG) and blacklisting of the firm in the country. The consultant E&Y was selected by the General Insurance Public Sector Association (GIPSA) management to bring efficiency, profitable growth and restructuring in public sector general insurance companies (PSGICs).

The PSGIC trade unions pointed out that the global financial consultant was fined $100 million for cheating in CPA exams. CPA stands for Certified Public Accountant and the CPA exams are conducted by American Institute of Certified Public Accountants (AICPA). The said news was published in international newspapers such as The Guardian, USA Today, and various other newspapers on June 20, 2022. Additionally, as per a media report, the German audit watchdog banned E&Y from taking up new audits for companies of public interest for two years, and handed the firm a fine of 500,000 Euro. This ban imposed in the wake of the firm's involvement in the Wirecard scandal, they added.

Talking to Bizz Buzz, Trilok Singh, General Secretary, GIEAIA and Convener, JFTU Northern Zone, said, “We have demanded statutory audit, CAG audit, blacklisting of E&Y and scrapping of the report submitted by it for the restructure of the four PSGICs.” PSGIC trade unions have been fighting against the Department of Financial Services, Union Ministry of Finance and the managements of PSGICs for imposing the report of E&Y in regards to closure and mergers/restructuring of PSGICs. They are also opposing the implementation of key performance indicators (KPIs) in PSGICs in a haste.

On the intervention of the Chief Labour Commissioner (CLC), the joint forum of trade unions and associations of PSGICs, has deferred their strike call on January 4 and March 29 this year. But nothing has happened so far, they say. “We are currently waiting for CLC meeting to take place. In case nothing gets materialized over next few days, then we will be forced to go for a series of actions, including a two-day nationwide strike”, Trilok Singh said.

According to him, the employees, officers, agents, surveyors, and other professionals working PSGICs have been opposing the report of E&Y. It is strange that the management of PSGI companies have not shared the complete reports with the employees, officers, and other stakeholders and are moving ahead unilaterally. The chief labor commission of the Government of India intervened and directed GIPSA management, DFS, and the corporate management of public sector general insurance companies twice, to have bilateral discussions with the unions/association and welfare groups. Still, the same was violated and dishonored.

It is pertinent to note that the PSGI companies, doing business of more than 1,25,000 crores, are under severe threat and have attained remarkable growth in this financial year with the present module. These companies have been fulfilling various social responsibilities and have contributed to Pradhan Mantri Fasal Bima Yojana, Ayushman Bharat Yojana and various Social Schemes and have been giving huge profits and dividends to the Government of India. on the contrary, there are serious charges of more than 15,000 crores on private players for irregularities in the payments of GST and settling of Crop claims.

The Joint forum of trade unions and associations have submitted memorandum to more than 25 distinguished members of Parliaments, Many Parliament members have urged the honorable finance minister and the senior-most authorities of the Government of India to take judicious action in this regard to protect, save, and strengthen these public sector general insurance companies.

We have demanded statutory audit, CAG audit, blacklisting of E&Y and scrapping of the report submitted by it for the restructure of the four PSGICs

-Trilok Singh, General Secretary, GIEAIA, tells Bizz Buzz