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No Festive Gifts Policy: A Welcome Move, but with Caveats
Sreenath Induchoodan, General Secretary of Union Bank Officers' Association Kerala State (UBOAKS/AIBOC) writes about the Finance Ministry’s circular banning expenditure on Diwali gifts and mementos by Central Public Sector Enterprises (CPSEs). He says while guidelines to ensure transparency, employee benefits like bonuses must continue. The bigger issue of unchecked perks and high-value gifting to top executives needs urgent scrutiny and accountability.
Author: Sreenath Induchoodan
Published: 12 hours ago
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The Government of India has once again reiterated its stance on economy and judicious use of public resources by directing all Central Public Sector Enterprises (CPSEs) not to incur expenditure on gifts during Diwali and other festivals. The Ministry of Finance, Department of Public Enterprises, through its recent communication dated 17th September 2025 (D.O. No. PP-II-7/10/2025-DPE), has made it clear that such expenses must be discontinued with immediate effect.
This is not the first such directive. The Central Vigilance Commission (CVC), through its letter No. 002-MSC/70 dated 27th August 2003, had discouraged the practice of PSUs and banks sending gifts to government officials, noting that it creates embarrassment and unnecessary dilemmas for officers. The Department of Public Enterprises (DPE O.M. No. 15(3)/2003-DPE(GM)/GL-48 dated 8th October 2003) also reinforced the same, citing provisions under the CCS (Conduct) Rules, which prohibit government servants from accepting gifts except on personal occasions like weddings, anniversaries, or religious functions.
While the policy of “no festive gifts” is a welcome move towards transparency and economy, it should not be misconstrued to mean denial of rightful benefits to employees. The share of profits in CPSEs and Public Sector Banks (PSBs) must continue to reach employees in the form of allowances, benefits, and bonuses, which are a legitimate part of industrial relations and employee welfare.
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At the same time, a more serious concern remains largely unaddressed—the practice of debiting corporate expenditure for gifting high-value items to top management and senior executives, often at the cost of junior officers. There have been several instances where officers, under pressure for promotions and transfers, end up bearing the burden of such expenses. If the Government is serious about curbing malpractices, it must not only prohibit festive gifts but also initiate investigations into the expenditure patterns of CPSEs and PSBs.
The Ministry of Finance and the Department of Public Enterprises should examine how much is being spent on maintaining higher-level executives and what proportion of such expenditure translates into non-transparent perks or informal benefits. Should an inquiry be initiated, there is ample evidence available to prove that this culture of favoritism and indirect gifting thrives in CPSEs and PSBs. Those found guilty must be held accountable.
The intent behind the no-gift policy is laudable. But for it to be meaningful, it must go beyond symbolic restrictions and address the real misuse of public money at higher echelons, while safeguarding the legitimate rights of employees to their share of organizational profits.
[Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the editorial stance of this publication.]
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