Monday, January 11, 2016

SN (a 1992 Pensioner)

DR and Updation of pension have been discussed umpteen number of times in the LIC PC. To recapitulate the 100 % neutralisation in DA/DR , anomaly etc.

LIC granted 100% neutralisation in DA to in-service employees and to those retired w.e.f. 01-08-1997. IBA granted full neutralisation in DA from 01-02-2005 to serving employees and those retired w.e.f. 01-11-2002. RBI followed suit and granted 100 % neutralisation in DA/DR w.e.f. 01-02-2005 to its employees and pensioners. RBI subsequently extended the benefit of 100 % DR to all pensioners from 01-02-2005, without cut off date like LIC and banks.

IBA has not granted full-100% DR to its pensioners retired before 01-11-2002 on one or another excuse. IBA has been crying hoarse that the matter is sub judice (DR related cases are pending in some courts) but are ready to extend the benefit of full DR to pre 01-11-2002 retirees on 'humanitarian point of view' based on detailed costing exercise. IBA has repeated the same thing in their letter dated 07-12-2015 addressed to the General Secretary, All Indian Banks Association, Chennai, not different from what they stated six months back in the Record Note dated 25-05-2015 with the leaders of employees associations. IBA has also repeated its desire to do feasibility exercise to grant family pension at 30% as given by GOI / RBI. It is surprising that IBA is unable to get details though more than six months have elapsed since the date of note. How many more months does IBA require to collect required data in this computer age? (Leaders of bank UFBU may like to ponder and decide with IBA). It is quite prudent of IBA that it has not repeated in its latest letter referred above that there is 'no contractual obligation between banks and pensioners!' IBA seems to keep the Bank leaders at peace by stating that unlike the GOI, the Banks Pension is a funded scheme and it is examining the cost implications and sustainability of each member bank at future date and will decide. They must quickly, in a month or two.

Pension schemes introduced by RBI, Banks and LIC in 1990s were on the lines of Central Government Pension Scheme. DA / DR was based on IV CPC. It was on reducing percentage basis to both serving employees and pensioners. While the serving employees in Banks and LIC (Pre Nov.and Aug.1992 respectively) got 100% neutralisation in DA upto the basic pay of Rs.2500/- and some percentage reduction on remaining pay, the pensioners got 100% neutralisation in DA /DR only Upto basic pension of Rs.1250/- and percentage reduction on remaining pension amount. Subsequently, on revision of pay scales, the serving employees (during Nov.Aug. 1992 to Oct./July, 1997) got full DA neutralisation up to Rs.4800/- and balance of pay on reducing percentage basis. The pensioners got full DA/DR only Upto Rs.2400/- and balance of pension on reducing percentage basis.

2. Shri C H Mahadevan has given two tables indicating the loss meted out to pensioners because of wrong method adopted in calculation and non compliance with Jaipur H.C. judgement. It is advisable to read the judgement to fully appreciate Shri Mahadevan. Extracts furnished below:

"...The grievance of the petitioners : dearness allowance benefit has been attached on the basic pension and not on the basic pay.

Basic Pay Rate of DA for every 4 points

i) Upto Rs.4800 ----- 0.35% of pay

ii) Rs.4801 to 7700-----0.35 % [not 0.25 % as typed in the judgement copy] of 4800 plus 0.29%
of pay in excess of Rs.4800

iii) Rs.7701 to 8200 -----0.35% of 4800 plus 0.29% of difference between Rs.7700 and Rs.4800
plus 0.17% of pay in excess of Rs4800

iv) Rs.8201 and above----- 0.35% of Rs.4800 plus 0.29% of difference between Rs.7700 and
Rs.4800 plus 0.17% of difference between Rs.8200 and Rs.7700 plus 0.09% of basic pay in excess of Rs.8200.

Under the Pension Rules, the benefit of dearness allowance was provided in the following manner :
Rate of dearness relief as a percentage of basic pension.

i) Upto Rs.2400 ----------0.35%

ii) Rs.2401 to 3850 ------0.35% of Rs.2400 plus 0.29% of basic pension in excess of Rs.2400

iii) Rs.3851 to 4100 ------0.35% of Rs.2400 plus 0.29% of the difference between Rs.3850 and
Rs.2400 plus 0.17% of basic pension in excess of Rs.3850

iv) Above Rs.4100 -------0.35% of Rs.2400 plus 0.29% of difference between Rs.3850 and
Rs.2400 plus 0.17% of the difference between Rs.4100 and Rs.3850
plus 0.09% of basic pension in excess of Rs.4100

In view of the aforesaid, benefit of dearness allowance at the first step being 0.35% remains upto basic pension of Rs.2400/- only whereas aforesaid percentage of dearness allowance is allowed on the basic pay upto Rs.4800/-.

Learned counsel for petitioners prayed that slab of dearness allowance should be kept the
same as is payable to the employees. In other words, it should not be reduced proportionately
to the basic pension.."

"...non-grant of due benefit of dearness allowance to the retired employees is not only arbitrary
but discriminatory in nature....This is more so when the pensioners who retired after 31.7.1997
are getting the benefit of dearness allowance on the basic pay and not on the basic pension,
thus pensioners have been divided in two categories in a discriminatory manner..."

Shri Mahadevan may 'expand' by way of one or two examples- the figures indicated in columns :

gross pension as per LIC's method ..and Total DR - anomaly free..

(a 1992 pensioner)