Category Archives: Pension

Pension Revision – Detailed letter of AUAB to Secretary DOT

31 Thursday Jan 2019

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The letter written by AUAB to Secretary DOT on Pension Revision is given below. The detailed letter put the demand very clearly for pension revision on the basis of IDA scales.

ALL UNIONS AND ASSOCIATIONS OF BSNL (AUAB)
No: UA/2019/ 31.01.2019
To
The Secretary (Telecom),
Department of Telecommunications,
Ministry of Communications,
Sanchar Bhavan, 20, Ashoka Road,
New Delhi-110 001.
Sub: Delinking of Pension Revision for the Pre-2017 BSNL retirees from the Pay
Revision of BSNL employees reg:
Ref: Assurance given by the Hon Minister and Secretary, DoT in the meetings held on
02.12.2018 and 03.12.2018 that Govt decided to delink the pension revision of
BSNL pensioners from the pay revision.
Respected Madam / Sir,
On the formation of BSNL, the employees working in DoT were absorbed in BSNL w.e.f
01.10.2000 with the assurance of better career prospects and payment of pension by the
Government of India. Accordingly Rule-37A was incorporated in CCS Pension Rules, 1972 to
ensure payment of pension on the combined service rendered in DoT and BSNL, on IDA
scales. On absorption, the employees were granted IDA pay scales w.e.f 01.10.2000.
Sub-rule 10 of Rule 37A of CCS (Pension) Rules, 1972, provides that “in addition to pension or
family pension, as the case may be, the employee who opts for pension on the basis of
combined service shall also be eligible to dearness relief as per Industrial Dearness Allowance
pattern”. Again as per Sub-rule 22 of Rule 37A of CCS (Pension) Rules, 1972, the pensionary
benefits, including family pension shall be paid by the Government.
In accordance with the above provisions, DoT revised the pension of pre-2007
pensioners/family pensioners of BSNL on 15.03.2011, who retired during 01.10.2000 to
31.12.2006. The pension revision followed the pay revision in BSNL as pay revision
implemented immediately after the DPE guidelines issued on 26.11.2008. Pension revision
implemented through Cabinet decision with 30% fitment, which took time with the fitment
allowed by the DPE for CPSUs.
The pension/family pension of the pre-2007 BSNL pensioners were revised w.e.f. 01.01.2007
as follows by adding together:
i) The existing pension /family pension, including commuted portion of pension, if any.
ii) IDA 78.2% as on 31.12.2006.iii) Fitment of 30%, as per DPE guidelines.
On 03.08.2017, DPE issued guidelines for 3rd Pay revision with 15% fitment. Para 3 of the OM
under the heading Affordability provides that the revised pay scales would be implemented by
the CPSEs subject to the affordability of CPSE. BSNL and MTNL are unique CPSUs where
the retirees are paid pension by the Govt of India as per Rule 37A of CCS (Pension) Rules,
1972. In BSNL, the pay revision is not implemented due to the affordability clause.
The pension Revision of Govt pensioners retired from BSNL cannot be linked with the
pay revision of the serving employees due to the following reasons:
1. All the BSNL retirees were Govt servants, recruited by DoT and absorbed in BSNL. Their
pension is covered by CCS Pension Rules, 1972 as in the case of Central Govt employees.
2. Pension revision for Central Govt pensioners already implemented.

3. As per the terms and condition for absorption, BSNL absorbed employees would continue to
get pension from DoT irrespective of the status of BSNL. As per para 2(b) of DoT order No:
40-13/2013-Pen(T) dated 20.07.2016, it has been clarified that “The liability towards
pensionary benefits including family pension to the BSNL employees (except those
recruited after 01.10.2000), as per sub rule 22 of Rule 37A of CCS (pension) Rules, 1972,
lies with the Government of India”.
4. The Affordability clause mentioned in DPE guidelines is applicable only for the pay revision
of the serving employees, not for the Pension Revision.
5. Pension revision has to happen even in the cases of:
i) If BSNL is not there?
ii) If BSNL is not profitable and No Pay Revision is implemented in BSNL?
iv) 3rd PRC given different fitment for the serving employees depends on its affordability. This
fitment will be reviewed after every 3 years. If the fitment varies, it will create anomaly
among pensioners.
v) Non-Executives are not covered by the fitment and the pay scales notified by DPE vide
OM dated 03.08.2017. Non-Executives wage revision is as per the negotiated settlement.
In Coal India, Non-Executives signed wage revision agreement with 20% fitment for 5
years period where as DPE guidelines stipulates that if 5 year wage settlement is made,
the fitment has to be proportionately reduced. However for the purpose of uniformity, Non
Executives as well as Executives in BSNL are extended the same fitment from 2nd PRC
period onwards. BSNL is a unique CPSU in that respect also.
6. BSNL retirees are no way connected with the affordability or paying capacity of BSNL. Their
pension is to be paid by the Govt of India, not by BSNL.
7. BSNL has already paid the pension contribution in full to the Govt of India, for their entire
service period in BSNL.
Since the matter of pay revision of BSNL employees pursuant to 3rd PRC recommendation is
yet to be settled, the issue of revision of pension for the pre-2017 BSNL pensioners is required
to be delinked from the pay revision of BSNL serving employees. It is already assured and
announced by Hon MoSC and Secretary, DoT in the meetings held on 02.12.2018 and
03.12.2018 that Govt decided to delink the pension revision of BSNL pensioners from the pay
revision.
However DoT letter to DoP&PW does not reflect this decision and lack recommendation or
proposal of DoT for delinking pension revision from pay revision. Without a proposal from DoT,
DoP&PW is unlikely to give any opinion in this regard. As per DoP&PW, the methodology is to
be worked out and suggested by DoT.
The methodology may be recommended to DoP&PW for giving its approval on the
subject. To avoid an anomaly between serving and the retired employees prior to
01.01.2017, the following method suggested.
a) The pension/family pension of the pre-2017 BSNL pensioners will be revised w.e.f
01.01.2017 as follows by adding together:
i) The existing pension /family pension, including commuted portion of pension, if
any
ii) IDA as on 31.12.2016.
iii) Fitment of 15%.
b) For the serving employees, fitment will be calculated as 15% w.e.f. 01.01.2017 itself
and pension contribution will be paid accordingly by BSNL. However, payment of pay,
allowances and perks will be made by BSNL depending upon its affordability. In the
month of retirement, the payment will be made based on full 15% fitment (Atleast in the
last month, payment will be made based on full 15% fitment).
Anomaly which may arise if pension revision is done with 15% fixation and pay revision
is done with lesser fitment.
A pensioner retired on Oct 2016 with Rs 50,000 last basic pay is getting Rs 25,000 as basic
pension as on 1-1-2017. Now if his basic pension is revised as per PRC with 15% the revised
basic pension will be Rs 63,100 [ i.e. Basic Pension+119.5% DA as on 1-1-07 + 15% fitment]
His batch mate retired on March 2017. His basic pay was also Rs 50,000 on 1-1-17 and last
basic pay on March was also Rs 50,000. Now his pay on 1-1-17 is revised as per PRC with
10% (say) fitment. So his revised pay on 1-1-17 will be Rs 1,20,700. Accordingly his last basic
pay on March would also be Rs 1,20,700 and pension will be 50% of Rs 1,20,700 i.e. Rs
60,350. Thus he will be getting Rs 63,100 – Rs 60,350 = Rs 2750/- less pension compared to
his batch mate retired before 1-1-17 whose pension is revised to Rs 63,100 as per 15%
fixation.
How to solve this anomaly:
Method 1
Fix the pay of 2nd person notionally with 15% fitment but actually with fitment of 10% (say) till
last month of his retirement. The Basic Pay of the last month of his retirement may be restored
as per 15% fixation and pension will be paid on last pay drawn actually. Hence for January and
February his basic pay will be Rs1,20,700 and for March it will be Rs 1,26,200 and accordingly
pension fixed at Rs 63,100 which is equal to his batch mate retired before 1-1-2017.
Method 2:
Fix the pay of 2nd person notionally with 15% fitment but actually with fitment 10%(say).
Hence at the time of retirement his actual Basic Pay will be Rs 1,20,700 and notional Basic
Pay will be 1,26,200. Now calculate his Pension as per his last drawn notional pay and his
pension will be 50% of 1,26,200 i.e Rs 63,100/- which is equal to his batch mate retired before
1-1-2017.
NOTE: This system of fixing pension on notional last pay drawn is already in vogue for BSNL
pensioners retired between 1-1-2007 and 9-06-2013 while extending the benefit of 78.2 IDA
Merger. Their Pay has been notionally revised by merging 78.2% IDA from 1-1-2007 and
Revised pension is being paid on revised notional last pay drawn from 10-06-2013.
Yours Sincerely,

Sd/- P.Abhimanyu (Convener) C.Singh (Chairman)

Copy to: (1) The PS to Hon Minister of State for Communications, New Delhi – 01
(2) Member (Fin), Telecom Commission, DoT, New Delhi – 110001
(3) Additional secretary, DoT, New Delhi – 110001.
(4) The Chairman & Managing Director, BSNL, New Delhi – 110001.
(5) The Director (HR), BSNL Board, New Delhi – 110001
(6) The GM (SR), BSNL Corporate Office, New Delhi – 110001

Kerala Budget – Senior Citizen Pension increased to Rs.1,200

31 Thursday Jan 2019

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In the Kerala Budget presented today by Finance Minister Dr. Thomas Issac, the Senior Citizen Pension which at present is Rs.1,000 will be increased by Rs.100 and fixed at Rs.1,200. During the next three  years, it will be increased by Rs.100 every year reaching to Rs. 1500. The demand raised by the Senior Citizens Friends Welfare Association was that it should be increased Rs.500 every years so as to reach Rs. 3,000 gradually.

Heart Congratulations to the Kerala LDF Government.

Pension Revision of BSNL retirees

12 Saturday Jan 2019

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It is more than one month that the pension revision of BSNL retirees was delinked from the wage revision of BSNL employees. But so far the same has not been done. There is already a system of Pension revision as was done in the 2007 pension revision. Now the pension revision is delinked, the government need not delay but should be done as done last time. The precedent is there.

Resolution adopted in the 9th All India Conference of BSNLEU, on Pension Revision for BSNL Retirees.

23 Sunday Dec 2018

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Resolution adopted in the 9th All India Conference of BSNLEU,
on Pension Revision for BSNL Retirees.

This 9th All India Conference of BSNL Employees Union held at Mysuru from 17th to 20th 2018 welcomes
the assurance given by the Honorable Minister for Communications, Sri Manoj Sinha, on 3.12.2018 in
the meeting held by him with AUAB (All Unions and Associations of BSNL), for delinking pension
revision for the BSNL pensioners from pay revision of serving employees . This Conference demands for
immediate approval for this delinking.
This Conference further demands that the pension revision be done for the BSNL Pensioners from
1.1.2017 as well as those retired after 1.1.2017, on the basis of 15% increase on basic pension plus
119.8% DA , on par with the IDA Pay Revision ordered by DPE on the basis of 3rd PRC
recommendation.
This Conference demands the DoT and Government of India for automatic revision of pension on the
basis the highest fitment benefit granted in IDA pay revision for executives in future also.

Congratulations! Kerala Government appoints committee reg. restoration of defined statutory pension.

09 Friday Nov 2018

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Com. Pinarayi Vijayan, Chief Minister led Kerala LDF government has appointed a high level committee to look in to the restoration of the defined statutory pension for its employees, which was converted to New Pension Scheme (NPS) by the UDF government in 2013. The committee with Shri. Sathish Chandrababu, former District Judge (Chairman) and Shri.P.Marapandian, Former Additional Chief Secretary and Shri. D.Narayana, Director, Gulathi Institute of Finance and Taxation as members is asked to submit its report within six months. Though the Central Government passed the PFRDA Act and implemented NPS for its employees, the then Left Front Governments in Kerala, W.Bengal and Tripura did not implement the anti-worker-pensioner Scheme. However, the UDF government in Kerala implemented NPS, despite strong opposition from the employees and their organisations.

The central and state government employees under the leadership of the Confederation of CG Employees, and All India State Government Employees Federation have declared two days strike on 8-9 January 2019 demanding cancellation of PFRDA and restoration of defined statutory pension. The entire central trade unions are in support of the demand.

The LDF in Kerala has given  election assurance that it will restore defined statutory pension. It is as part of this fulfilling of the promise that LDF government has appointed the committee.

Hearty Congratulations to the Pinarayi Government for this pro-worker decision!

Big Demonstration of Pensioners in Athens

07 Sunday Oct 2018

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Big Demonstration was held on October 4th by the Athens Pensioners’ Unions. The mobilization is part of the new round of action with which the pensioners’ struggle against the policy of the government that hits pensioners and pensions, against old and new pension cuts. Pensioners claim to abolish all reactive health and insurance policies as well as they demand increases in pensions.

Reintroduction of Old Pension Scheme – Minister answers Lok Sabha Question

11 Saturday Aug 2018

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The Central as well as state government employees’ organisations are demanding that the PFRDA should be annulled, NPS (New Pension Scheme) dropped and that the old defined benefit pension should be restored. They have called for a strike on 15th November, on demands including the above. The pension through NPS will be far less than the defined benefit pension and even is not fully assured. But the government is sticking for NPS. The reply in the Parliament shows the government’s defence of the indefensible. We fully support the demand of the central/state government employees for restoration of the old defined benefit pension scheme.

GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF FINANCIAL SERVICES

LOK SABHA
UNSTARRED QUESTION NO. 4075

TO BE ANSWERED ON AUGUST 10, 2018/SHRAVANA 19, 1940 (SAKA)
REINTRODUCTION OF OLD PENSION SCHEME

Shri Rakesh Singh

Will the Minister of FINANCE be pleased to state:

the details of drawbacks of the New Pension Scheme (NPS) introduced for the Government officials; whether the NPS is not as beneficial monetarily as the Old Pension Scheme (OPS) and if so, the details thereof; whether the Government employees are disgruntled with the NPS and if so, the details thereof; and whether the Government proposes to reintroduce the OPS replacing the NPS, if so, the details thereof and the action taken by the Government in this regard?

ANSWER

The Minister of State in the Ministry of Finance
(Shri Shiv Pratap Shulda)

(a) & (b) National Pension System (NPS) has been designed giving utmost importance to the welfare of the subscribers. Government has made a conscious move to shift from the defined benefit pension scheme to defined contribution pension scheme i.e. NPS, due to rising and unsustainable pension bill. There are a number of benefits available to the employees under NPS. Some of the benefits are enlisted below:

§ NPS is a well designed pension system managed through an unbundled architecture involving intermediaries appointed by the Pension Fund Regulatory and Development Authority (PFRDA) viz. pension funds, custodian, central record keeping and accounting agency, National Pension System Trust, trustee bank, points of presence and Annuity service providers. It is prudently regulated by PFRDA which is a statutory regulatory body established to promote old age income security and to protect the interest of subscribers of NPS.

§ The pension wealth which accumulates over a period of time till retirement grows with a compounding effect. The all-in-costs of the institutional architecture of NPS are among the lowest in the world.

§ Contribution made to the NPS Tier-I account is eligible for tax deduction under the Income Tax Act, 1961. An additional tax rebate of Rs.50000 is also allowed for contributions made to NPS Tier-I under Section 80CCD (1B) of the Income Tax Act, 1961.

§ Subscribers can withdraw up to 25% of their own contributions before attaining age of superannuation, subject to certain conditions. Further, PFRDA vide “PFRDA (Exits and Withdrawals under the NPS) (First Amendment) Regulations, 2017” dated 10.08.2017 has liberalized norms for partial withdrawals which also include reduction of requirement of minimum years of being enrolled under NPS from 10 years to 3 years from the date of joining.

§ PFRDA has increased the maximum age limit from 60 years to 65 years for joining NPS-All Citizen Model and Corporate Sector Model, vide “PFRDA (Exits and Withdrawals under the NPS) (Second Amendment) Regulations, 2017” dated 06.10.2017.

§ PFRDA vide “PFRDA (Exits and Withdrawals under the NPS) (Third Amendment) Regulations, 2018” dated 02.2018 has facilitated easy exit & withdrawal in case of disability and incapacitation of the subscriber covered under NPS.

§ Transparency and Portability is ensured through online access of the pension account by the NPS subscribers, across all geographical locations and portability of employments.

(c) & (d) Representations have been received which inter alia also include the demand that the Government may revert to old defined benefit pension system. However, due to rising and unsustainable pension bill and competing claims on the fiscal, there is no proposal to replace the NPS with old pension scheme in respect of Central Government employees recruited on or after 01.01.2004.

Medical Allowance for BSNL employees – Restore original order

18 Wednesday Jul 2018

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After much protest and persuasion, the BSNL Management has restored the Medical Allowance without voucher for out-door treatment. But the management has reduced the quantum. This is not acceptable.
The Management should restore the Medical Allowance for pensioners as earlier. Otherwise it will be treated as an insult and against senior citizens as provided in the Maintenance and Welfare of Parents and Senior Citizens Act 2007.
AIBDPA General Secretary has already taken up the case with the CMD BSNL.

GRATUITY CEILING INCREASED UP TO RS. 20 LAKH

28 Wednesday Mar 2018

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Ministry of Labour & Employment
Payment of Gratuity (Amendment) Bill, 2018 passed by Parliament

The Payment of Gratuity (Amendment) Bill, 2018 has been passed by parliament today. The bill ensures harmony amongst employees in the private sector and Public Sector Undertakings/Autonomous Organizations under Government who are not covered under CCS (Pension) Rules. These employees will be entitled to receive higher amount of gratuity at par with their counterparts in Government sector. The bill was passed by the Rajya Sabha today and the Lok Sabha on 15 March, 2018.
The Payment of Gratuity Act, 1972 applies to establishments employing 10 or more persons. The main purpose for enacting this Act is to provide social security to workman after retirement, whether retirement is a result of superannuation, or physical disablement or impairment of vital part of the body. Therefore, the Payment of Gratuity Act, 1972 is an important social security legislation to wage earning population in industries, factories and establishments.

The present upper ceiling on gratuity amount under the Act is Rs. 10 Lakh. The provisions for Central Government employees under Central Civil Services (Pension) Rules, 1972 with regard to gratuity are also similar. Before implementation of 7th Central Pay Commission, the ceiling under CCS (Pension) Rules, 1972 was Rs. 10 Lakh. However, with implementation of 7th Central Pay Commission, in case of Government servants, the ceiling has been raised to Rs. 20 Lakhs.

Therefore, considering the inflation and wage increase even in case of employees engaged in private sector, this Government decided that the entitlement of gratuity should also be revised in respect of employees who are covered under the Payment of Gratuity Act, 1972. Accordingly, the Government initiated the process for amendment to Payment of Gratuity Act, 1972 to increase the maximum limit of gratuity to such amount as may be notified by the Central Government from time to time.
In addition, the Bill also envisages to amend the provisions relating to calculation of continuous service for the purpose of gratuity in case of female employees who are on maternity leave from ‘twelve weeks’ to such period as may be notified by the Central Government from time to time.

After enactment of the Act, the power to notify the ceiling of the amount of gratuity under the Payment of Gratuity Act, 1972 shall stand delegated to the Central Government so that the limit can be revised from time to time keeping in view the increase in wage and inflation and future pay commissions. (PNB dated 27-03-2018)