Clarification to lower take home pension to retirees between 01.11.2012 & 25.05.2015 as under:
by G.S AIPNBOA Shri Dilip Saha
As this time DA was merged at unprecedented level of 60.15%, those who retired between 01.11.2012 & 25.05.2015 they will get reduced pension but huge amount of difference of Commutation. Higher DA merger level was also reason for IBA allowing only 2 % load.
Last time after DA merger & applying higher load the 10000/- BP had become 14500/- i.e. BP increased by 45% from 10000 to 14500. This time after DA merger & applying load of 2%, BP increased by 61.18% from present level. Thus superannuation cost increases substantially more that last time.
Pl remember that we negotiated only on Pay slip cost and the settlement amount of Rs.4725 Cr to be applied on pay slip components only. But that does not mean there is no other cost to Banks. The increased superannuation cost estimated to be another Rs.4500 Cr have to be borne by Banks.
By doing a lower DA merger, our residual DA would have been higher, allowing us to put maximum load on merged BP and every thing would have looked good including no reduction on take home pension. But this would have spoiled across the board lose on superannuation benefits and future increase due to DA increase would also be slow.
In present DA merger scenario, we had to put a load of 15.25% on merger BP to maintain same take home pension. Had the settlement been 15.25% & we apply entire amt in merged BP, then other rates like HRA, CCA etc would not only can't remain at present percentage level, they had to be reduced drastically in percentage terms to get existing amount.
Now, let's analyse the reduction of take home pension of retirees between 01.11.2012 & 25.05.2015.
Though there take home amount reduces, they get huge increase in commutation amount by way of arrears. The interest on this at staff rate is higher than reduction in pension. Pl don't forget that the addition commutation amount is additional capital in your hand while the interest compensates loss in pension.
Some may say the additional amount does not matter, what matters is reduction in take home pension. For them we made a provision in the Joint note where such pensioners are given option not to commute full eligible amount from revised Basic Pay. Which means, they may take a very small additional commutation in order to protect existing take home pension. Ofcourse they will get salary arrears.
But please understand that the pension they are getting in this intervening period is notional and there is no actual loss. Just consider that if the settlement was finalised on the very first day when it was due i.e. on 1st Nov 2012, they would take commutation in such a manner that they get whatever is their take home pension requirement.
But I suggest, one should not commute lower amount though provision is made in Joint note. The addition commutation amount remains in your hand as your capital and interest takes care of shortfall. If any unfortunate death takes place, the family looses the capital amount as also the interest thereon.
Hope I could make it clear.
Regards
Comment By Facebook Group Sangharsh Karo: but why this is an absurd argument of IBA and 'Record Note" is a latest invention of IBA in the process of Bi partite negotiations hither to not heard about!
While IBA mention on Pension matters, following clause has been added in 10th BPS:
" Officers in service of the Banks as on 1st November 2012 and who have retired thereafter but before 25th May 2015 and who had opted for commutation of pension will have an option not to claim incremental commutation on revised basic pension.
Is it Is it not pertains to retirees? What is the relevance and necessity of such 'record note' when none of retirees issues/demands are resolved under 10th BPS. Contradictory statements just to fool the pensioners!!
RECORD NOTE ON DISCUSSIONS OF IBA WITH UFBU ON ISSUES/DEMANDS OF RETIREES ON 25th May 2015.
Dear Friends,
The text of 'Record Note of discussions on retirees issues' between UFBU and IBA is furnished here under ,which only exposes the casual approach and arrogance /anti retiree/pensioner attitude of IBA officials, rather than a document with professional touch/in depth analysis of subject pending for decades! .
Record Note of Discussions between Indian Banks' Association and United Forum of Bank Unions on the issues and demands relating to retirees of the Banks held on 25th May, 2015 at Mumbai. **********
In the Charter of Demands submitted by the Workmen Unions/Officers Associations for revision of wages and service conditions, certain demands pertaining to the superannuation benefits /issues of retirees were raised. These issues were discussed in detail on various occasions during course of negotiations on the Charter of Demands.
IBA maintained that any demand of retirees can be examined only as a welfare measure as contractual relationship does not exist between banks and retirees.
The periodic wage revision exercise based on mandate from member banks cover only wages and service conditions of serving employees. Retirement benefits are based on service conditions prevailing at the time of retirement of an employee and these do not change with subsequent settlements.
Referring to repeated comparison of pension scheme in banks to Government pension scheme, IBA stated that while the Government pays pension out of Budgetary allocation, bank pension is a funded scheme. At the time of retirement of an employee, the bank is expected to ensure that adequate funding is made for payment of pension/family pension with provision for periodic updation of dearness relief payable. As such there is no provision for updation of pension in banks. Financial implications will need to be fully examined before any change in benefits payable to pensioners can be considered.. The following table gives the details discussion/ conclusion reached on various issues raised:
Issues raised by the United Forum of Bank Unions
Response of the Indian Banks' Association
01. UFBU: LFC and Hospitalization reimbursement should be extended to retired bank employees/officers
IBA : A revised hospitalisation/medical expenses reimbursement scheme is being finalised for the in service employees and officers and the benefit of the coverage of this same Scheme would be extended to retirees also subject to the condition that the cost of the insurance premium under the Scheme would be payable by retirees.
Extending Leave Fare Concession facilities to the retirees is not possible.
02. UFBU: Revision in the rates of Family Pension on the same lines of the Central Government scheme and RBI scheme
IBA While the IBA is sympathetic to the issue, the cost involved is significant and unaffordable at the present juncture. IBA will examine cost implications and sustainability of each bank, at a future date.
03. UFBU: Extending Dearness Relief at 100% compensation to all pre-November, 2002 pensioners as in the case of post November, 2002 retirees.
Firstly, the matter is sub-judice as certain cases on this issue are pending for a decision with Supreme Court. As such, IBA cannot take a decision on this issue at this stage. From a humanitarian point of view, IBA may examine feasibility of providing 100%dearness relief neutralization to pre November retirees Based on a detailed costing exercise.
05.Upgrading the Basic Pension of all the pensioners at the common and uniform index 4440 points
IBA would examine the cost implications
and sustainability of member banks.
06.Updation of Pension for all existing pensioners and family pensioners
This being a funded scheme in lieu of contributory PF.As it is Banks are contributing several times the statutory PF contribution towards funding pension scheme every year.Hence providing for the periodical updation is not possible as this will have serious impact on the working of banks.
07.Uniform Percentage of allocation for welfare fund towards schemes pertaining to retirees
Govt. guidelines permit banks to provide benefits to retirees out of welfare fund
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