LIC PENSIONERS CHRONICLE

Note on the problems of LIC pensioners

(SUBMITTED TO THE MINISTER) 

The Central Government notified the Life Insurance Corporation of India (LIC) pension rules in June 1995. They were framed on the basis of pension rules of Central Government employees. There is a provision in Central Government pension rules to upgrade pension, whenever wages of Central Government employees are revised. Accordingly pensions of Central Government were revised as per the recommendations of the IV, V and VI pay

commissions.

When VII pay commissions submits its recommendation shortly, the wages of Central Government employees and pension of central government retirees will be upgraded. The pensions of LIC retirees have been stagnating at 1992 level. As per the wage agreement dated August 1, 1997 between the unions and LIC management; there was a change in the calculation of dearness allowance (D.A) formula.

According to this formula the D.A works out to 0.23% for each slab of cost of living index from 1-8-97 and 0.18% for each slab of cost of living index before 1-8-97. Because of this change those who retired before 1-8-97 get only 50% of D.A on their pension. While pensions are revised for Central Government retirees according to wage rise of employees similar situation does not exist in LIC.

Therefore the Executive Director retired before 1-8-97 gets less pension than the driver who retired after him. The board of Directors of LIC in its meeting on 24th November, 2001 in a resolution decided 
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1)To set right the anomaly in D.A payment on pension of Pre-August 1997 retirees and
2) To revise pensions of LIC pensioners as per wage revision of in service employee’s Legal battle of LIC pensioners:

Sri Krishna Murari Lal Asthana, retired employee of LIC filed two writ petitions before the Jaipur Bench of Rajasthan High Court on the above two issues.

Sri Bhandari Hon'ble single Judge of Jaipur Bench of Rajasthan High Court admitted these two writ petitions of Sri KML Asthana on 12-1-2010 and directed LIC to implement its resolution of the board of Directors dated 24th November 2001.

The appeal of LIC challenging the judgment of Sri Bhandari was dismissed by the division bench of Rajasthan High Court on 21-1-2011. The two review petitions of LIC on this matter again were dismissed by the Rajasthan High Court on 19-8-2013.

Two special leave petitions filed by LIC before Supreme Court, to set aside the judgement of Sri M.N.Bhandari, were dismissed by the Supreme Court on 19-8-2013.

The Punjab & Haryana High Court,Chandigarh quoted the judgement of Sri M.N.Bhandari and ordered to pay the amounts due to LIC pensioners on account of

1) D.A anomaly and
2) Upgradation of pension with 12% interest.The Delhi High Court also quoted the Judgement of Sri M.N.Bhandari in its order on the same and directed LIC to make payment to all the LIC pensioners.

At present there is no stay on the operation of the Judgement of Sri M.N.Bhandari dated
12-1-2010.
Inspite of the above verdicts of the various High Courts in India and Supreme Court, LIC has been dodging implementation of the Judgements, challenging the majesty of the courts at the cost of contempt proceedings against the top officials of LIC.

This is because of the support and directions given by the previous congress government it is also learnt that Sri P.Chidambaram Ex-Finance Minister left his post without taking any decision on the note submitted by the secretary of Finance ministry.

It is here we seek your intervention please take up the issue with the present Finance ministry and see that a final decision is taken on this issue pending for more than 16years.

“LIC is fully owned Government undertaking whatever benefits that are applicable to Central Government employees are to be extended to LIC employees also,”Pranab Mukherji, the present Rastrapathi said this when he was Finance Minister.

VI pay commission recommended increase of pension to Central Government pensioners.

   

Aged 80 yrs	By 20%
Aged 85 yrs	By 30%
Aged 90 yrs	By 40%
Aged 95 yrs	By 50%
Aged 100 yrs	By 100%

Financial position of LIC and the Genuineness of Pensioners issues

LIC has been financing all the Five year plans from 2nd to the 11th Five year plan to the extent of 40% of outlay of each Five year plan.

When LIC was formed in1956, the Central Government invested Rs 5 Crores as initial capital in LIC.During the last 14years LIC paid a dividend of Rs 7873 Crores to Government of India.

Maintenance cost of LIC as on 31-3-2010 is Rs 12,246 crores	Pension payments Rs 422 crores (only 3.45%)
Maintenance cost of LIC as on 31-3-2011 is Rs 16,980 crores	Pension payments Rs 497 crores (only 2.93%)

         

Expenses on account of wages as on 31-3-2010 Rs 8,053 crores	Pension payments Rs 422 crores (only 5.24%)
Expenses on account of wages as on 31-3-2011 Rs 12,055 crores	Pension payments Rs 497 crores (only 4.12%)

Assets of LIC Rs 15.6 Lakh crores

Life fund of LIC Rs 13.3 Lakh crores

Annual Income  Rs 3.3Lakh crores

LIC’S investments during 5year plan periods:

PLAN	YEAR	INVESTMENT IN CRORES
II	1956-1961	184
III	1961-1966	285
IV	1969-1974	1530
V	1974-1979	2942
VI	1980-1985	7140
VII	1985-1990	12969
VIII	1992-1997	56007
IX	1997-2002	170929
X	2002-2007	394779
XI	2007-2012	704151
XII	2012-2014	183988