change of family pension in public sector banks
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Pension scheme was introduced in the year 1995 as second benefit in lieu of PF broadly on the lines of pension scheme of the Government. It is not mere understanding but every part of pension scheme that was framed was made identical to the Central Government Pension Scheme.
Evenafter two decades of introduction, still the following issues are not in line wiith the Government pension scheme. It may be observed that PSB pension is paid out of the pension funds created by the banks themselves not from the consolidated fund of the Govt.
Pension Updation – Pension is revised with every Pay Commission for Govt. employees whereby the pension of retirees of past years are brought to closer to the pension of current retirees having the benefit of latest pay commission. Similar updation was agreed to be provided in the pension settlement signed in 1993. This was duly incorporated in the Pension Regulations under Reg.35 which provides for updating pension as per formula given in appendix-1. The formula given in appendix 1 is nothing but the formula obtaining in Central Government in 1986. As the only persons who required updation at the time of implementation of pension in 1995 were those who retired under IV Bipartite Settlement and their pension was updated by notionally revising their pay in line with V Bipartite Settlement Pay. However the pension updation that was agreed, provided for and implemented was discontinued unilaterally. However the government is updating the pension of their retirees at every Pay Commission and have also started upgrading their pension after the age of 80 where a pensioner reaching the age of 100 years get his full pay updated as pension. Bank retirees are not even getting pension updation, not to speak of pension upgradation though the bank’s pension scheme was framed on the lines of government pension scheme.
Family Pension – When bank pension is framed on the lines of Government pension scheme Uniform family pension at 30% of pay without ceiling as obtaining in Government and in RBI should be extended to banks too. As the scheme exists, family pension payable to wards will be too negligible because it is very rare for pensioners to have wards drawing family pension. So mostly the spouses would only be family pensioners and in fact many pensioners would have no spouse alive or wards eligible to draw family pension. Even the spouses alive may not have long life expectancy which on an average may be less than 10 years. Inasmuch as pension ( at 50% of pay) itself is provided for the full life span of every employee as per AS 15(R) standards and family pension sought at 30% without ceiling should not entail any additional cost. With every death the provision already made at 50% of pay becomes excess and banks would be able to write back the excess provision. So only a portion that would be written back has to be spent to give family pension at uniform 30% without ceiling which will not impact the profits of the bank in any way. Further the number is too low and it is also inequitable to have discriminatory percentage for family pension alone while pension for every pensioner is a uniform 50% of pay without ceiling.
In current scenario, the family pension of general manager of the bank will be less than the family pension of clerk of central government. It is not out of place to mention, RBI had amended the family pension in line with Central Government, but the same is being denied to PSB retirees.
It is absolute necessity to introduce uniform 30% pay without ceiling as family pension in line with Government and RBI. Further the unmarried and financially dependent daughters of pensioners should be made eligible to get family pension in line with the provisions of central government pension.
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