LIC PENSIONERS CHRONICLE

                  

                                                             

As the pension scheme in Public Sector Banks 

is, by and large, a carbon copy of the RBI pension 

scheme, the pattern of up-dation accepted there

may be made applicable to us also, writes 

Shri BG Raithatha, Union Bank Retired Employees' 

Association, Rajkot.

(Write up by Shri Mahalingam, Principal Chief General Manager, Financial
Markets department, RBI, Co, Mumbai is reproduced 
for general reading of LICPC readers)

Dear All

You may perhaps be surprised to receive this mail from me, as it is a slight departure from the tradition of receiving communication from the General Secretary or other functionaries. But I thought there was a need to share my thought process given the importance of the issue on hand.

The Pension issue has come to the fore once again ever since the Governor called the United Forum for a meeting last week. There has been a wide spectrum of opinions on the issue, not very often driven by practicality, rationale and common sense. I do see a streak of high emotions, sometimes bordering on dogmatism not to see the writing on the wall. I thought it was time to add my perspective to the issue. While I do not expect that everybody should subscribe to this perspective, I feel it is time for each of us to ponder over the issue.

At the outset, we need no appreciate that this issue has been evading solution for a long time thanks to the historical ‘baggage of commissions and omissions. We did garner quite a bit of support from our Central Board members as well as Top management thanks to the orderly and disciplined manner in which we conducted our silent protests just ahead of our Central Board meetings in the last couple of years. While a good number of Central Board members were sympathetic to our cause, the issue remained unresolved thanks to the intransigence of the GoI nominees on our Board.

The issue got a fresh lease of life with our present Governor taking the bold initiative of breaching it directly with the Finance Minister at the Delhi board Meeting. This has brought forth the present offer from the GoI although it does look quite fuzzy. Governor mentioned during the meeting with the United Forum that this was about the best that he could get but the fuzziness of the conditionalities does leave scope for squeezing the best out of the offer.
What has been majorly agitating the minds of our officers are: 1. the frequency of wage agreement for the serving officers, 2. the definition of pay for the purpose of pension and 3. rationalisation of perks for serving officers. The condition of updation being done once in 10 years has not met with much criticism, so I am leaving it out of the present discussion.

On the frequency of wage agreement, I am not at all convinced that a wage agreement once in 5 years is necessarily more beneficial than a wage agreement once in 10 years. Why are we refusing to look at the magnitude of wage revision? Are we better off with a wage revision of 15 to 16% hike once in 5 years than, say, 40 to 50% in 10 years? The numbers that I have quoted here are not out of alignment with what we have been getting in the past and the G0I officers have been getting out of Pay Commissions once in 10 years. In fact, I feel our emphasis should be on the quantum of hikes (which is a clear function of our strength, bargaining capacity as also the image of the organisation) rather than the frequency of wage revision. Just to exercise our minds more on this subject, are we going to be happy if we are offered pay revisions once every two years with a hike of 5%? So, basically, it is not the frequency which matters but the extent of hikes.

Also, let us not forget that the perks have been revised reasonably more frequently as and when the conditions of the economy underwent changes and these perks have enhanced the quality of our living conditions. There is no reason to fear that the independence of the Governor is going to be curtailed in the matter of perks. Given the increasing stature of Central Banks, I doubt if any Government can curtail the independence of the Governor in times to come. 

Now, coming to the question of definition of pay, we need to be realistic. lf basic pay and grade pay are reckoned for fixing the pension, the larger components are already taken and what get left out are the much smaller components. I have done some calculations in this regard and I find that the components that get left out actually constitute just about 5 % of the basic + grade pay. Of course, this percentage could vary from officer to officer depending upon his basic pay and grade pay at the time of his retirement. We need to weigh this loss against the gain arising out of updation of our pay once in 10 years, which could be as much as 100%. I think we need to ponder over this quite dispassionately.

Third is the matter of perks. There is a fear (may be, legitimate) that rationalisation of perks means reduction and nothing else. lf we compare our perks today with the industry or with GoI (where a Joint Secretary gets car with unlimited petrol), nobody can say that RBI 's perk structure is far superior to others. We are just comparable to others and not certainly better off. I am told that many Oil companies have better perk structure compared to RBI but this needs to be verified. But if at all there is a pressure to show rationalisation, we can always give up the smaller ones like newspaper, brief case, specs, book grant, etc. and tell the Government that we have rationalised and focus on improving the larger components (in the present pay revision due from Nov. 2012). This certainly is largely dependent on our capacity to do homework and engaging in constant dialogue with the Governor in future. 

I certainly do not subscribe to the idea that the Central Government will keep interfering, in future, with the process of determination of our perks. Let us not, in any case, be submerged in imaginary fears that the Central Government is the personification of Takru and vice versa!!.

Given this backdrop, if we are slamming the door closed on this present offer and reject it outright, let us be clear about what we are in for:

1. There is no way that this issue will come up for the next , at least, one year, as the new Government (if it is stable) will have so many items on its plate that this will, if at all, be the last item in their agenda.

2. We will lose the sympathy of our Central Board members.

3. The Top management may not evince me same enthusiasm to take up the issue in future as they have done so far.

In my view, therefore, a more prudent and strategic course, would be to accept the offer saying that we would like to have a dialogue with the Governor on the nature of conditionalities and their implementation. I am aware that you will ask the question that this will tantamount to a break-off with United Forum. Not necessarily. We can convince them as they do not have much stake in the form of perks. But if they are not to be convinced, perhaps, we may have to chalk out our own path. Let us be clear here.

I have told Mr. Vatsa that we can have a meeting of the Committee with all the units participating, shortly in the second week of April, say around April 10th. In the meantime, let me have your dispassionate views on the subject.

Best regards

G. Mahalingam

Principal Chief General Manager, Financial

Markets department, RBI, Co, Mumbai