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Thursday, July 18, 2019

Supreme Court order On Pension Updation

16.07.2019

Dear retirees of PS GIC/LIC/BANKS,

The above attached is a reportable Hon'ble Supreme Court of India Judgment dated 11.07.2019 (All Manipur Pensioners Association vrs The State of Manipur). 'REPORTABLE' legally means that this Hon'ble Supreme Court of India Judgment dated 11.07.2019 has become the law of the Land. It is the latest and final Hon'ble Supreme Court Judgment dated 11.07.2019 over previous Judgments, if any, on the same dispute or controversy of pension revision/ pension updation so far. It is in practice of the Hon'ble Supreme Court that in case, there exist various Judgments of the Hon'ble Supreme Court on the same issue or dispute or controversy contradictory to each other, the latest and final Judgment is always considered for reference to conclude any fresh Judgment on the same controversy in the future. Therefore, it is my humble request to all that our any Association/ Union in PS GI Companies/ LIC /Banks must take the best possible legal advantage of this Hon'ble Supreme Court Judgment dated 11.07.2019 in our pending cases in the Hon'ble Supreme Court of India or High Court relating to pension revision/ pension updation every five years.

Please read this Hon'ble Supreme Court Judgment dated 11.07.2019 thoroughly and particularly its Paragraphs 7.2, 7.4, 8, 8.1 & 9. In this Judgment, the Hon'ble Supreme Court has actually extended the ambit of its own earlier Judgment in D S Nakara's case and ordered in this Judgment in favour of pensioners who have retired from service prior to any pay revision date, to pay revised pension from time to time simultaneously with revised pension paid to other retirees due to pay revision/ revised pay scales for employees, who also retire from service any day and, thus, he/she has been getting an increased quantum of pension after his/her retirement from service comparing to those retirees who have retired prior to the same effective date of any pay revision. It is, thus, a very clear and detailed Hon'ble Supreme Court of India Judgment dated 11.07.2019 in favour of all the pensioners to get revised pension from time to time, if pension is revised for other retirees post any retirement date. As per this Hon’ble Supreme Court Judgment, all the pensioners are equally situated to get revised pension as the increased cost of living similarly affects all the retirees irrespective of his/her date of retirement from service. Further, consequent to this Judgment, the Employer cannot take the plea that all the pensioners under the same Statutory Pension Scheme cannot be treated equals or at par due to financial constraint of the Employer. The Employer now cannot impose any cut-off date to create two classes of pensioners to pay revised pension to the pensioners with effect from any retirement date from service and at the same time to deny the same revised pension to the pensioners who have retired prior to the same date of retirement from service. Such an act of the Employer to discriminate the pensioners on the basis of his/her retirement date from service would now be a Contempt of this Hon'ble Supreme Court Judgment dated 11.07.2019, which please note.

Therefore, the anamolies existing in paragraphs 3-A & 3-B in APPENDIX-IV of the Statutory General Insurance (Employees') Pension Scheme 1995 and similar paragraphs in the Statutory Pension Scheme 1995 in PS LIC/Banks should now be removed by Government of India by obeying the Order of this particular Hon'ble Supreme Court Judgment dated 11.07.2019. The wordings used in the amendment dated 22.06.2000 i.e. insertion of paragraphs 3-A & 3-B in APPENDIX-IV in our Statutory Pension Scheme 1995 after the same pension scheme was originally notified in the year 1995, is now unlawful and is a Contempt of this Hon'ble Supreme Court Judgment dated 11.07.2019. The word 'employee' appearing in paragraph 3-B in APPENDIX-IV should now be replaced by the word 'employee and retiree including retiree under SVRS, SVRP, GGSVS etc.', otherwise the paragraphs 3-A & 3-B in APPENDIX-IV are clear contempt of this Hon'ble Supreme Court Judgment dated 11.07.2019, arbitrary, discriminatory and also violative of Article 14 of the Constitution of India as per this Hon'ble Supreme Court Judgment dated 11.07.2019, which please note.

The hidden adverse effect of paragraphs 3-A & 3-B in APPENDIX-IV of the Statutory Pension Scheme 1995 is that if you convert the DA/DR increase per slab into percentage terms on the effective date of any Pay Revision, you will find that post such effective pay revision date the increase in quantum of pension percentage wise is higher than the increase in quantum of pension for retirees who have retired from service prior to the same effective pay revision date, whereas the cost of living is increased just similarly for all the retirees irrespective of date of retirement from service.

Paragraphs 3-A & 3-B in APPENDIX-IV are appended hereinbelow for the information of all pensioners of PS GI Companies/LIC/Banks :

(3-A)   In the case of employees who have retired or died on or after the 1st day of August, 1997, the dearness relief shall be payable for every rise or be recoverable for every fall, as the case may be, of every four points over 1740 points in the quarterly Average Consumer Price Index for Industrial Workers in the series 1960=100. Such increase or decrease in dearness relief for every said four points shall be at the rate of 0.23 percent of basic pension.

(3-B)   In case of any wage revision in future the rate of dearness relief payable to an employee shall be determined by the Corporation corresponding to the index to which the scales will be linked.

Paragraphs (3-A) and (3-B) in APPENDIX-IV have been inserted later on in the Statutory General Insurance (Employees') Pension Scheme 1995 vide S.O. 590(E) dated 22.6.2000 with effect from 01.8.1997 and the same paragraphs were not existing in the original Statutory Pension Scheme of 1995.

Last but not the least, each pensioner of PS GI Companies/LIC /Banks from all over India should send his/her strong letter/ representation immediately to their respective Chairman/CMD/MD with copies to the Hon'ble Finance Minister, Department of Financial Services, Government of India, New Delhi with a request to ensure that any PS GI Company or LIC or Bank must not commit Contempt of this Hon'ble Supreme Court Judgment dated 11.07.2019 in any manner. Any law professional should come forward in our Group and prepare the same draft letter to help all the pensioners in this endeavour.

Thanks & Regards,
Pramod Srivastava (Pune)


_________-_____________________

Following is the link related to an article published on the issue

https://www.livelaw.in/top-stories/classification-of-pensioners-by-providing-cut-off-date-146278

Sunday, July 14, 2019

Updation of Pension

From  :  Kulbir Singh Bhatia,
Kothi No. 8,
Bank Enclave,
P. O.  Model Town,
JALANDHAR CITY - 144 003.
PUNJAB.


The Chief Manager,
Punjab & Sind Bank,
H.O.P.F Department,
Ashram Chowk, Sidhartha Enclave,
NEW DELHI - 110 014.

Reg:-  REVISION / UPDATION OF PENSION.

Dear Sir,

I request a reference to your letter no. 445/19 - R dt.04-07-2019 and  my representation dt.28-06-2019  on the above noted subject, wherein your good office has informed me that Revision of Pension of Bank’s ex- Employees does not fall under the jurisdiction of individual  Banks and it comes under the Jurisdiction of IBA which will be approved by Ministry of Finance/ Govt. of India & only then it will be implemented.

In this regards I wish to submit that holding Pension Revision is an industrial issue and by not taking Pension Revision / Updation  seriously and disposing the matter in a casual manner by writing two lines reply under the signatures of junior officers that too from PF & PENSION department, where as atleast senior most officer of  PAD/Staff welfare department should have taken up the issue and signed this important communication, though the authority to whom this communication is addressed is required to sign the letter. This is sufficient to believe how senior executives evade decision making in Banks and escape  responsibility on important and sensitive service matters. Bank cannot escape its responsibility by not extending the benefits as agreed in Memorandum of Understanding 1993 and Pension Regulations,1995 and diverting the matter to IBA.

I am ex-employee of Punjab & Sind Bank and to raise /address my grievances I will have to first approach the Bank for its redressal under the mechanism advised by the government of India/MOF regarding the issues of Retirees relating to service matters,  which inturn after following due procedure and after passing a resolution in Bank’s Board will have to give a Mandate to IBA for discussing the issues with concerned parties.  IBA after discussion will advise the Banks accordingly and the procedure to take up the issue with concerned quarters will be followed. I regret to say that Bank is trying to hush-up the matter as usual under the carpet by not following the proper procedure to be adopted in the matter.

Kindly note that IBA is not my Employer so the issue of Pension Revision/ Updation of Ex-employees of Banks doesn't come under its jurisdiction, certainly it is the duty of Bank’s Boards to deal with the matter independently. Punjab and Sind Bank is a Nationalized Bank and a body corporate constituted under the Banking Companies (Acquisition & Transfer of Undertakings) Act, 1970, which is “state” in itself as defined in Article 12 of the Constitution of India and is to act in furtherance of the welfare of the subjects of the Pension Regulations, 1995 making it essential to desist itself from denial of due benefits to the subjects of the beneficial legislation, with the end in view of snatching away the property of the employees in the long run.

Now I submit that as per Pension Regulations, 1995 the Bank gave me an option and I accepted the same. On that basis the Bank started paying Pension to me after my retirement from the services of the Bank. Hence it is a "CONTRACTUAL RELATIONSHIP" between the "BANK" and "PENSIONER" (me) arising out of that contract due to which the BANK is paying Pension to me every month from the Pension Trust Fund Account and nowhere any third party is involved in this contract.

It is rather surprising that how you have advised me to directly approach IBA/MoF for the Revision/Updation in Pension fully knowing well that it is a contract between the Bank and the Employee/Pensioner. Kindly note that after deducting 50% of my SPF contribution amount and paying me Pension in lieu of that as per the "CONTRACTUAL RELATIONSHIP", the Bank is duty bound to honour my already delayed demand of Revision/Updation of Pension as per Pension Regulations, 1995 in letter and spirit.

Sir, I am a member of the Pension Trust Fund of the Punjab & Sind bank governed by its Pension Regulations viz. Punjab & Sind Bank (Employees’) Pension Regulations, 1995, which are statutory and binding on the Bank as Payment of Pension/Updating of Pension being out of the Pension Trust Fund. The Pension Scheme having been commissioned in lieu of CPF Scheme and fed by the contributions which were previously payable by the Bank as contributions to CPF pursuant to EPF and Miscellaneous Provisions Act, 1952 comprises of the deferred wages of the Employees held in trust by the Bank for payment to Employees on cessation of employment, though this brings in ZERO expenditure to the Punjab & Sind Bank. Yet, the Bank is not Revsing/Updating the Pension in utter disregard of Regulation 35(1) and 56 of the Pension Regulations, 1995 mandating the updating.  By not Revising/ Updating Pension to me  and similar Retired Employees, we are being deprived of a life with dignity at old age as our Pension is not revised ever since the inception of the Pension Scheme thus defeating the very purpose of Pension when the Pension Trust Fund account of Bank have  got sufficient funds to  meet the Pension Revision /Updating of the present  Pension to all the Pensioners. 

The Pension Fund comprising the deferred wages of the Employees can be used only for payment of Pension as provided under regulation 5 (2) that  :

“The Pension Fund shall have for its sole purpose the provision for payment of Pension or Family Pension in accordance with these regulations to the Employee or his Family”.

The Pension Fund of the Banks need not be used for service employees who joined its service after 31.03.2010 as they are covered under the PFRDA Scheme of Pension of the Bank/ Government. As such, the Pension liability of the bank will extinguish in due course of time when the last pensioner breaths his last and the Pension Fund may vest with the bank only.  In these circumstance, the Banks are acting in connivance and detaining the money in the Pension Fund without paying the statutory benefits conferred by regulations 35 (1) and 56 with the evil design of snatching it away for themselves in the long run when the beneficiaries of the Pension Fund get extinct.

In terms of section 10 (7) of the Act, the Board of Directors of the Bank can declare a dividend and retain the surplus profits as accumulated reserves only after making due provision for Superannuation Funds like Pension, the said section giving a prior charge to Pension over the profits of the Bank  stating as infra Section 10 (7) as :

 "After making provision for bad and doubtful debts, depreciation in assets, contributions to staff and superannuation funds and all other matters for which provision is necessary under any law, or which are usually provided for by Banking Companies, a corresponding new Bank may out of its net profits declare a dividend and retain the surplus if any.”

Section 10 (7) of the Act puts an onus on the Bank to pay the statutorily defines Pension even in case of operating in loss.  The Bank was declaring dividends  in past without paying the statutorily defined Pension in gross derogation of regulations 35 (1) and 56 of the Pension Regulations out of the Pension Trust Fund, neglecting section 10 (7) of the Act.

Section 10 (7) of the Act gives a prior charge to Superannuation Funds over the profits of the  Bank which is a statutory guarantee to the Employees while taking over Banks through Act 5 of 1970 and even in case of loss, Banks cannot evade payment of Superannuation benefits. In as much as Pension is payable out of the Pension Trust Fund which is the deferred wages of the Employees and Pension costs ZERO expenditure to Bank, the Banks, by not Revising the Pension as mandated by Pension  Regulations 35 (1) and 56 are indulging in a heinous crime of detaining the money of the Employees and denying them their right to live unbecoming of its status as the Government and “state”.
Hon’ble Supreme Court of India too have made it clear  in Order dated 01.07.2015  in Civil Appeal No.1123 of 2015 viz. State of Rajasthan & Ors.  Vs. Mehendra Nath Sharma and dated 13.02.2018 in Civil Appeal No.5525 of 2012 viz. Bank of Baroda & Anr. Vs. G Palani & Ors. emphasizing that Pension and Revision of Pension/Updating of Pension are inseparable/inevitable. The rulings made by the Apex Court says, even when Pension is payable by the State causing an expenditure to the Exchequer,  that State cannot take a plea of financial burden to deny the legitimate Pension, as Pension is property within the meaning of Article 19 (1) (f) and 31 (1) of the Constitution. It is the duty of the State Government to avoid any unwarranted litigation etc. and as such the Banks are not justified in denying or delaying due Pension and Updating of Pension that brings in ZERO expenditure to them as Pension is payable out of the money and property of the employees and their deferred wages.

Keeping above in view,  I once again request your good office to give a sympathetic view to my representation and implement in letter and spirit Pension Regulations 35 (1) and 56 which are Bank’s own rendering approved by the Legislature as a subordinate legislation and are the rules in force applicable, and forward/give a required necessary  mandate to IBA for discussing and Revising the Basic Pension in tune with the Revision in Pay Bands arising out of Bipartite Settlements to enable IBA to initiate necessary steps in the matter .

I wish to add further that The bank is bound to act in accordance with the ruling of  the Hon’ble Supreme Court in order dated 13.02.2018 in Civil Appeal No.5525 of 2012 viz. Bank of Baroda & Anr. Vs. G Palani & Ors. that “the regulations have statutory force, having been framed in exercise of the powers under section 19 (2) (f) of the Act of 1970 and are binding”, and that “That it is it is not permissible to add or subtract any word in a provision is a settled principle in statutory interpretation” since the ruling is squarely applicable in the case of regulations 35 (1) and 56 and disregard to the ruling, could lead to contempt of the Apex Court. Moreover  Bank is under an obligation  to Revise/Update the Pension of its Ex-mployees in view of the following observation of the Hon’ble Supreme Court in All India Reserve Bank Retired Officers Association and Ors Vs. Union of India & Ors.,  (1992) Suppl.1 664) .

“ The concept of pension is now well known as has been clarified by this Court time and again.  It is not a charity or bounty nor is it gratuitous payment solely dependent on the whim or sweet will of the employer.  It is earned for rendering long service and is often described as deferred portion of the compensation for past service.  It is in fact in the nature of a social security plan to provide for the December of life of a superannuated employee.  Such social security plans are consistent with the socioeconomic requirements of the Constitution when the employer is a State  within the meaning of Article 12 of the Constitution.”

The Bank’s decision by appropriate authority on the Revision/Updation of Pension be communicated to me within fifteen days from the receipt of this letter.

Thanking You.

Yours faithfully,



(_________signature_____)

Name :

Designation :

PF No./ Staff No.

Address :

Mobile No.

Email No.



CC:-  1) Shri S. Harisankar,
M.D. & C.E.O.
PUNJAB & SIND BANK
Head Office
New Delhi - 110 008
 for information and necessary action please.

CC:- 2) The General Manager
PUNJAB & SIND BANK
Personnel Administration Department,
Head Office,
NEW DELHI - 110 008
 for information and necessary action please.

List of Court Orders Passed in Favour of Emoloyees



Tuesday, July 9, 2019

Can Gratuity Amount be Denied To Dismissed Employee?



https://www.taxmanagementindia.com/visitor/detail_article.asp?ArticleID=8130




August 23, 2018

In this case, the Supreme Court while elucidating on the issue of forfeiture of gratuity on dismissal of service has stated that gratuity can be forfeited only if there is any loss to the Bank on account of the misconduct of the dismissed employee.

Case name: Union Bank of India & ors. v. C.G. Ajay Babu & anr.

The issue that fell for consideration before the Supreme Court was whether forfeiture of gratuity, under The Payment of Gratuity Act, 1972 (hereinafter referred to as ‘the Act’), is automatic on dismissal from service?

In the case, the respondent employee was dismissed subsequent to disciplinary proceedings against him. The Appellant Bank in the case on dismissal also forfeited gratuity.

Aggrieved by which, the respondent approached the High Court. The Division Bench of the High Court passed order in favour of the respondent employee holding that only if there is any loss to the Bank on account of the misconduct, then alone, the forfeiture is permissible to the extent of loss.

Aggrieved by the aforesaid, the Appellant Bank approached the Supreme Court.

Bench’s Verdict

The Supreme Court Bench in the case dismissed the Banks’ appeal and upheld the High Court’s order on the basis of the following observations:

The Supreme Court while arriving at its decision made reference to the bipartite settlement dated 19.08.1966 prevailing in the Bank and the clause dealing with the forfeiture of gratuity which states that “There will be no forfeiture of gratuity for dismissal on account of misconduct except in cases where such misconduct causes financial loss to the bank and in that case to that extent only.

In view of the aforesaid, the Court noted that the settlement provides for forfeiture only if there is a loss caused on account of misconduct leading to dismissal. With reference to the facts of the instant case, the Court was of the view that there was no case for the Bank that the misconduct of the respondent-employee had caused any financial loss to the Bank, and therefore, forfeiture of gratuity under Section 4 of the Payment of Gratuity Act could not be resorted to.

While arriving at its decision, the Supreme Court also made reference to its judgment in the case of Jaswant Singh Gill v. Bharat Coking Coal Limited and others, wherein it was held by this Court that forfeiture of gratuity either wholly or partially is permissible only in the event that the termination is on account of riotous or disorderly conduct or any other act of violence or on account of an act constituting an offence involving moral turpitude when he is convicted.
In view of the aforesaid, the Supreme Court held that forfeiture of gratuity is not automatic on dismissal from service; it is subject to sub-Sections (5) and (6) of Section 4 of The Payment of Gratuity Act, 1972.


Sunday, July 7, 2019

What Unions Mean to Say AND How They Act

CRY IN WILDERNESS.....

OUR attention has been drawn to a Circular letter dated 7.7.19 of AIBOA, flashed on social media on 6th July, 2019, a day ahead the date.

Letter starts with, " Social media is used, misused and abused by one and all and retired bank employees are equally active." Thus, letter is a sort of retort written in disdain of retirees activism on social media. It's welcome trend, given the fact that all Unions have kept their doors & windows closed from inside, not giving vent to inside story. In such a situation banking fraternity, irrespective whether in-service or retired, is wandering on social media.

In next sentence the letter talks of, 'one of the prominent question that is often raised was that why pensioners issues are not taken up the the IBA, by 9 constituents in the wage talk'. I thought, he would address this his 'prominent question', but nothing found in subsequent paras. Yes, it's a prominent question, which the retirees have been raising, but none attended to or even acknowledged it. Atleast, this letter acknowledges and admits it as 'prominent'. Thank you, Mr. Nagrajan, though you evaded to answer it and tried to divert the attention to points, which are irrelevant in present day context.

It's totally uncalled for to turn the pages of history. How pension was achieved in 1993 and at what cost second option in 2010, it all holds no merit today. Albit, you evaded to narrate that the SBI pension underwent change and it's not same as it was in 1993 as third benefit. Take it as updating, that SBI unions got by force and fight. Not only this, in all settlements in lieu of pension cost, SBI people got additional compensation that they appropriated to stand at higher wage platform than rest of banks. Hope, this is not denied & challenged being matter of record! How it went unnoticed, by the Unions (other than SBI)? If for pension load, SBI can get additional amount, why not other Banks' employees should have got compensatory amount in lieu of what SBI incurred in updating its pension?

I see you play divide in not identifying 'pension improvement' as one issue. Dear brother, It's single issue and not that you prioritized and termed as (i) Family Pension, (ii) 100% DA for pre- 1.11.2002 retirees (which SC dismissed), (iii) updating, (iv) pre-1986 Retirees' exgracia. Your attempt to segregate and identify the 'pension improvement' as four issue- family pension, 100% DA case, pension updating & exgracia- is wrong with ulterior in motive. Further, which are the bigger issues: DA case of pre-1.11.2002 retirees which was lost in Hon'ble Supreme Court of India, listed as second issue or updating listed as third? The issue is one which need wholesome and holistic view, instead going by appeasement tactics to divide aggrieved pensioners who may be one regular pensioners, family pensioners,100% D.A. pensioners or exgraciawala. They are one, their issue is one and their need is one: improvement of pension, in other word, pension updating. Hope, you improve and articulate your thought process, in this regard, accordingly.

NOW, I would like to discuss on your  narrative, 'one thing all of us should appreciate that when the serving employees issues are moving in a snail pace...'. Well, it's common phenomenon that in bath tub all are naked, but you made all unions and leaders naked in public glare by your above narrative. May it be a new dress code! Why so and who is responsible, atleast for sure, none of in-service or retirees! So, legitimately speaking, it's none of their problem. In service employees and officers follow your calls like bonded labour. They firmly believe in you, accord you all privileges and honor from time time. If you have failed, you must explain bonafide reasons, instead hiding from them. Bad air reaches fast. While you put your naked feature on social media, but expect of retirees, 'there is a need to have restrain in expressions in the social media by retirees'. If you can, let us do our job too, of course under sheer  frustration and not by pleasure to accuse and abuse our veterans.

Further, your next sentence, 'getting the family pension settled gains importance & priority', conveys the internal mind set that even if family pension improvement is achieved, it will be more than all achievements, in the back drop of 'snail pace' movement of in-service employees wage revision talks.

Dear Mr. Nagrajan, it would have been better, if you could have avoided sending circular letter in question, in fact, that could have helped pensioners to live in illusion of something good in store for them. Hope- you know- is a great source of energy, particularly for older generation. Oh! It's for over three long decades in hope! Countless people died under miseries, ailment, economic distress.

I should remind you few things in respect of Pension Scheme. When there was tug of war on this Policy, all bankers, all Unions and govt were together against this. It was alone AIBEA, which fought and signed settlement. War continued even after settlement on option issue. AIBEA was categorical on scheme being best option, as it was linked to DA index, DA revision on quarterly basis as was in case of in service employees and pension revision as in case of RBI.

Whenever wage revisions have had been done, in lieu of pension cost on our Penis, SBI people got additional compensation. But, what other Bank people got, when SBI pension was updated? Third benefit base was our Pension Scheme. Our Pension didn't get any improvement, but SBI people got their third benefit pension updated. What were the reasons that made our Unions deaf, dumb & blind? Now, RBI pension is updated, Bank Pension is linked to it. How could anybody over look all these facts?

9 Unions ( 5+4) submitted their demands, which include pension issues. IBA revealed the fact that they have only mandates for wage revision and in officers matter uptown scale 3 from some Banks. IBA very clearly said, they have limited mandate for wage revision and not for Pension. For full mandate for officers, two unions walked away from table talks. But, none of you 9 have yet clarity in pension updating matter or decided or disclosed your common stand and resolve on pension improvement as against IBA stand of no mandate for pension. This is the prominent question hunting the mind of pensioners, which Mr. Nagrajan you should have answered, instead writing obituary at this crucial juncture when entire banking fraternity is passing through most uncertainty and disbelief from their organizations.

If no mandate in officers case can become an issue of direct action, why can't no mandate for Pension be, an issue concerning to over 4 lakh pensioners?

- J. N. Shukla,
PRAYAGRAJ
9559748834/7.7.2019
jagat.n.shukla@gmail.com

( Neither Prejudices Nor Predilections)

Saturday, July 6, 2019

AIBOA letter on issues related to Retirees

AIBOA letter on issues related to retirees
Historical achievement by BUPGB RETIRED STAFF WELFARE SOCIETY-
comreds 

In the matter of payment of Gratuity to 53 retired officers of BUPGB by calculating on last drawn basic pay.The Appeallet authority DLC Kanpur has passed a historic order in favour of appellants. As per order attached herewith employer has to pay gratuity by calculating Basic pay +DA+Special pay + DA on special pay. Special thanks to Comred Ajit Mehrotra who very effectively pleaded cases before DLC and also thanks to Our senior most Comred SN SINGH for his valuable suggestions. This is the only case all over India in which special pay and DA on special pay has been allowed by Appeallet Authority. 

Historic achievement by an unit of AIRRBEA. 

CONGRATULATIONS TO ALL OF YOU. 
RAMESH MISHRA 
JT. SECRETARY 
AIRRBEA

Wednesday, July 3, 2019

Why Demand of Updating Pension Of PSBs Is Justified?

Updating of Pension of PSBs Pensioners


If RBI pension is revised/updated why not the same in PSBs? PSBs Pension Scheme is ultimately based on RBI Scheme!

Primarily, having reached to updating settlement with Unions, the Governor of RBI requested the Ministry of Finance vide its letter dated 6the Oct., 2017  for Updating of Pension to RBI Pensioners. The request was declined vide Ministry communique dated 26.2.2018, on premises of contingent effect, which the govt presumed that it would result in
similar demands in Public Sector Banks, most of which were/are running in
financial difficulties.

The govt had since consented to RBI pension updating w.e.f. 1-3-2019, at pay revision level of 31.10.2012, now the deck is cleared for PSBs pension updating.

The noting by officers of DFS, at Page Number 263 to 265 of File No 11/5/2001- IR, are of dates
from 31.1.2018 to 22.2.2018, that needs to be perused.

Page Number 264, para (ii) says, “At present Pension Corpus is around Rs.12000 Crores”, para (v) says, “RBI has informed the financial cost of updating in RBI is 857.52 crores.

In contingent effect, IBA has informed,  updating pension in PSBs could cost Rs.95000 Crores, which PSBs wont be in a position to bear with. Prima facie, it looks exaggerated, beyond rationale. Thus, it needs some introspection.

1.RBI & PSBs have similar Pension Regulations-1995. Date of effect is same as 1.1.1986. Pay Revision blocks are same. We can conclude: updating cost of PSBs Pensioners same at CPI 4440 level.

2. RBI Pension Fund was stated to be Rs.12000 crores. Updating cost was estimated to be as Rs.857.52 crores. Now percentage wise it works out
as= 857.52÷12000×100= 7.146% of RBI Pension Fund corpus.

3. Let us examine the Rs.95000 crores cost calculation of IBA. Pension Funds corpus of 26 PSBs was Rs 164647.01 as on 31.3.17. Now, minus SBI subsidies      ( from 1.4.17) let us take mid of  2017-2018, as Sept-2017. Sept.2017, Pension Funds may be taken as Rs.171417.91 crores. On this basis the cost percentage of IBA works out as: 95000÷171417.90×100= 55.42% of corpus of PSBs.

4. Now, let us analyze the PF of PSBs viz a viz RBI. PSBs' Sept-2017 PF was Rs.171417.91 cr. as against of 12000 cr. of RBI. PSBs' PF corpus works out to be 14.28 times of RBI corpus, (171417.91÷12000). Further, PSBs corpus works out to be 111.39% of needed corpus as per calculations.

5. With all similarity, as stated in point 1, supra, there is another point that RBI scales are bit superior to PSBs, thus pension out go is equally more per capita.

Thus, it's abundantly clear that IBA figure of Rs.95000 crore as updating cost is not only exorbitant, but it's concocted, fabricated and aimed at to deceive, thus a sort of mischief and bundle of lies. It's sole purpose is to defeat and deny updating demand by quoting such exorbitant updating cost figure to government, though baseless. If at all, Unions succeed in bringing up updating demand in discussion, IBA will use it as a tool and shall try to exploit the situation to negate updating in the name of unaffordable cost. In case some favorable situation crops up for updating, IBA may try to snatch big share from load amount on this ground.

Billion dollar question is: how negotiating Unions make IBA sit, discuss and settle pension/family pension updating issue, particularly in a complex situation where IBA says, (i) it has no mandate for pension updating, (ii) it negotiates only on mandated issues, (iii) there is no contractual relationship between pensioners with their respective banks, and (iv) updating cost is whooping etc.

IBA's tough stand is stupenduously clear in officers' mandate matter. IBA didn't budge any bit despite two days strike by officers and massive dharana at the call of AIBOC. The little concession offered to negotiate upto scale v, had been withdrawn by IBA, making matter straight and simple that it would go ahead with workmen Unions to clinch the 11th wage settlement and whatever parameters are applied to workmen, on same IBA would settle officers wages & service conditions.

Well, reading the writing on wall, perhaps, great worriers of 21st century with other two had met in recent past at Bengaluru to take the stock of their armoury. Workmen Unions have, since decided to go solo and hold negotiations! The joint communique to IBA by 4 Officers Unions from Bengaluru is a sort of knee walk endeavor to parley.

Legitimately, we can call it resurrection. In trade union history, never before, such mishap had happened. AIBOC used 1000kg bomb first by resorting to two days strike, followed with crackers show by holding a dharana at Delhi, met Pappuji, a fired cartage & nobody in the art of scheme, and now  to IBA with white flag in hand.

Well, according to Pension Scheme, existing pensioners have had made their contributions and those who are still in service they are doing it irrevocably, in compliance of quid-pro-quo deal. As envisaged in Regulations, 1995, to maintain the adequacy of Pension Funds is the task of Bankers. Accordingly, there is provision in Regulations, 1995, to carry out Acturial exercise every year on 31st March and make good the short fall, if any, by making additional contributions. It's mandatory and obligatory in terms of Pension Agreement, 1993 & Pension Regulations, 1995. Bankers trick has been to escape from additional contributions, by witholding legitimate right of updated pension.

Informed sources say, Pension Funds are at around Rs.2.49 lakh crores in March, 2019. It is stated to be over 111% of required funding. If it is so, bankers need not to make any additional contributions. Even if it is not and they have to make some contributions, they must do it, as by witholding updating for such long years, enormous savings they have had made, of course at the cost of poor pensioners.

Terms and extents of pension updating are settled in RBI Pension updating decision. PSBs pension scheme warrants same touch. Negotiating Unions have to firm up themselves on this issue.

Negotiating Unions must introspect the Mediclaim Insurance Policy, as increased premiums in last three years have had pushed pensioners out of health cover due to unaffordable premium. More than 60% pensioners are dropped out of scheme. This poses serious insecurity to majority of pensioners' fraternity. Unions-IBA must review it. IBA/ Bankers must agree to minimum health cover free of cost as welfare measure. Whatever cost Bankers incur, they bear the same out of Welfare Funds, to which pensioners are equally entitled. Pensioners may bear the cost above the free cover. To tide over claim ratio, Bankers must take common policy for in-service personnel and retirees. Cashless system breeds corruption that push high claim ratio. It needs to be reviewed and some alternate mechanism should be found out to control the situation. It was earlier in many banks and still possible, if UFBU-IBA seriously think in this regard. Existing cashless facility at listed hospitals, TPA is just an enabling mechanism to loot. IBA must respond to situation sincerely to mitigate health insecurity of pensioners.

- J. N. Shukla,
PRAYAGRAJ, 3.7.2019
9559748844/ jagat.n.shukla@gmail.com

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