Petition updateUpdation of Pension to Bank Retirees/Pensioners - out of their own Pension corpus Fund -Petition to PM / FM dated 12.12.2016
Jayaprakash NBangalore, India
Apr 6, 2017 — Date: 06.04.2017 To: Hon’ble Prime Minister of India and Finance Minister, Respected Sirs, This is in continuation of our petition dated 12.12.2016 submitted online by the TEAM: Jayaprakash, Jayaraman, Jayaram, HSN Murthy, HS Vasudeva Rao & Vijayalakshmi, followed by many reminders on online http://pgportal/govt.in/pension, registered as No. 2016/0582101 dated 15.12.2016 and PMOPG/E/ 2017/ 0123160 dated 03.03.2017, 2017/0163262 dated 23.03.2017 and 2017/0171644 dated 26.03.2017 humbly requesting for sanction of: (1) Periodical updation of Pension (2) 100% DA Neutralization (3) Improvement in Family Pension to all Bank Retirees/Pensioners at Par with employees & Pensioners of Central/State govt, Armed forces under OROP, law makers MLAs/MPs, and now Hon'ble judges who have been recently accorded with hefty increase in their emoluments. We are not jealous of their getting comfortable source of increased income, but why it has been unlawfully & consistently denied & deprived of such updations/revisions during last three decades to our Bank Brethren as a basic necessity and thus we, the Bank Retirees feel that a great injustice has been done to them to live their life with self-respect & dignity. The petition was also lodged through www.change.org a world platform seeking support from all colleagues, friends & well-wishers to our struggle and in response to our struggle, out of lakhs of Bank Retirees, nearly 5600 people have endorsed/supported our initiative for the benefit of all the Bank Retirees, the same has been from time to time endorsed to your office by www.change.org Despite consistent follow-up on the above grievances through all the available plat forms, unfortunately, their issues neither responded nor redressed by the concerned authorities which is a matter of anguish for us and that is the disquiet the rulers are presenting to their Senior Bank Retirees & Citizens of our land. Now, assuming that the original petition was very brief to the issue concerned and needs more explanation to justify the reasons why Banks Retirees are also human beings and citizens of this land and needs to be treated at par with other retirees facilitated under CCS (Pension) Rules, 1972, we hereunder submit the elaborate underlying principle under which the grievances of Bank Retirees deserve a sympathetic & lawful consideration without any discrimination. Now, We, the Petitioners under Bank Employees Pension Regulations, 1995 Act, and endorsers/supporters as part of Bank Retirees/ Pensioners to this petition most respectfully submit hereunder the detailed reasoning, rationale, rightful, lawful justification to deserve to be entitled for all benefits at par with other Retirees under CCS (Pension) Rules, 1972: 1. Due to arbitrary, unequal and unjust treatment given by respective Bank managements and IBA to its ex-employees i.e. Retirees/Pensioners, there is huge disparity and discrimination among the Pensioners and aforesaid disparity and discrimination is widening further with passage of time. This has also resulted in artificial classification among the pensioners on the basis of their dates of retirement. Besides, because of non-merging of the Dearness Relief amount with the Basic pension and non-revision of the Basic Pension as and when there is revision in the Salary (which is being customarily being done every 5 years), the pension amount being paid to the retirees is arbitrarily kept at low levels and effectively stagnant. 2. Due to arbitrary and discriminatory application of Regulations same, rank officials retiring on different dates get different amount of pensions, also a far lower rank officer ends up getting higher pension because of having retired later. This ultimately results in huge disparity in the pension amount being paid. 3. There is also disparity between the manner in which pension is being paid to retired employees of the Central Government and the retired employees of the Banks, even though it is the same Central Government which effectively controls and regulates the Banks and is even the framer of the Pension Regulations. The whole manner and computation of pension defeats the objective behind giving pension and in violation of Article 14 and 21 of the Constitution. I. CONCEPT OF PENSION 4. The Constitution Bench of the Hon'ble Supreme Court in Deoki Nandan Prasad v.State of Bihar & Ors.1971 (2) see 330 authoritatively regulated that pension is a right and the payment of it does not depend upon the discretion of the Government. This view was reaffirmed in State of Punjab & Anr. v. Iqbal Singh.1976 (2) see 1. It is well settled that Pension is neither a bounty, nor a matter of grace depending upon the sweet will of the employer, nor an ex gratia payment. It is deferred wages for the past services rendered. It is a social welfare measure rendering socio-economic justice to those who in the heyday of their life ceaselessly toiled for the employer on an assurance that in their old age they would not be left in the lurch. It provides a society security at the old age and disablement. It is considered as avowed object to provide socio economic justice to fulfil mandate of the Constitution of India. [Subrata Sen vs Union of India 2010 (8) see para 14... also Ponnamal vs Union of India 1985 (3) see 235J. 5. In D.S. Nakara vs Union of India 1983 (1) see 305, the Hon'ble Supreme Court while holding that the pensioners as a whole constitute a homogeneous class and there can be no discrimination among them on the basis of date of retirement, laid down the following principle in the said judgment:- a. .. the pre-liberalized pension scheme did not provide adequate protection in old age and that a further liberalization was necessary as a measure of economic security. When Government favorably responded to the demand it thereby ipso facto conceded that there was a larger available national cake part of which could be utilized for providing higher security to erstwhile government servants who would retire. The Government also took note of the fact that continuous upward movement of the cost of living index as a sequel of inflationary inputs and diminishing purchasing power of rupee necessitated upward revision of pension. If this be the underlying intendment of liberalization of pension scheme. can anyone be bold enough to assert that it was good enough only (or those who would retire subsequent to the specified date but those who had already retired did not suffer the pangs of rising prices and falling purchasing power of the rupee? What is the sum total of picture? Earlier the scheme was not that liberal keeping in view the definition of average emoluments and the absence of slab system and a lower ceiling. Those who rendered the same service earned less pension and are exposed to the vagary of rising prices consequent upon the inflationary inputs. If therefore, those who are to retire subsequent to the specified date would feel the pangs in their old age, of lack of adequate security, by what stretch of imagination the same can be denied to those who retired earlier with lower emoluments and yet are exposed to the vagaries of the rising prices and the falling purchasing power of the rupee. And the greater misfortune is that they are becoming older and older compared to those who would be retiring subsequent to the specified date. The Government was perfectly justified in liberalizing the pension scheme. In fact it was overdue. But we find no justification for arbitrarily selecting the criteria for eligibility for the benefits of the scheme dividing the pensioners all of whom would be retirees but falling on one or the other side of the specified date. " 6. In Kerala SRTC v. K.O. Varghese, (2003) 12 SCC 293 at page 301 [para 18 to 20], the Hon'ble Supreme Held as under:- b. "18. Summing up, it can be said with confidence that pension is not only compensation for loyal service rendered in the past, but pension also has a broader significance, in that it is a measure of socia-economi justice which inheres economic security in the foil of life when physical and mental powers start ebbing corresponding to the aging progress and therefore, one is required to fall back on savings. One such saving in kind is when you gave your best in the heyday of life to your employer, in days of invalidity, economic security by way of periodical payment is assured. The term has been judicially defined as a stated allowance or stipend made in consideration of past service or a surrender of rights or emoluments to one retired from service. Thus the pension payable to an employee is earned by rendering long and sufficient service and therefore can be said to be a deferred portion of the compensation for service rendered. In one sentence one can say that the most practical raison d'etre for pension is the inability to provide for oneself due to old age. One may live and avoid unemployment but not senility and penury if there is nothing to fall back upon. 7. Hence from analysis of series of judgments [few of them mentioned above], it well established and has been consistently held that:- i. that pension is neither a bounty nor a matter of grace depending upon the sweet will of the employer and that it creates a vested right subject to the statute, if any, holding the field, ii. that the pension is not an ex gratia payment but it is a payment for the past service rendered; and iii. It is a social-welfare measure rendering socio-economic justice to those who in the heyday of their life ceaselessly toiled for employers on an assurance that in their ripe old age they would not be left in the lurch. It must also be noticed that the quantum of pension is a certain percentage correlated to the emoluments earlier drawn. Its payment is dependent upon an additional condition of impeccable behavior even subsequent to retirement. That is, since the cessation of the contract of service and that it can be reduced or withdrawn as a disciplinary measure. If this is the avowed object of pension, then it is incomprehensible as to how an old aged pensioner would be forced to survive only on a fraction of amount which is being paid as pension to other Pensioners who retired recently from the same or lower post. Those who retired earlier and are infirm and old aged cannot be worse off than those who retired later. The practice followed by Banks and IBA is against the basic concept and object of grant of Pension II. BANKS PENSION REGULATIONS AND ITS SIMILARITY TO THE CCS (PENSION) REGULATIONS 8. The Bank (Employees) Pension Regulation 1995 (hereinafter referred to as "the Pension Regulations"), came into force w.e.f. 29.09.1995 and only those who have joined the services prior to 01.04.2010 became eligible to Pension under these Regulations. It is a closed category and number of beneficiaries under the Regulations is limited, known and identifiable. It is an admitted position that the number of employees who would ultimately be covered under these Regulations is limited and Banks are well aware that it is fast decreasing number. 9. The Pension Regulations have been drafted by the Central Government in the line of the CCS (Pension) Regulations 1972, wherein the various provisions including provisions for computation of initial basic pension i.e. by taking into account average pay for last 10 months [Regulation 34 of the CCS (Pension) Regulations 1972] as well as that of Dearness Relief are identical. The similarity is also from Regulation 56 of the Banks pension Regulations, which is a residuary provision, and makes CCS (Pension) Regulations applicable in situations where the Pension Regulations are silent. Similarly, like CCS Regulations, pension under the Bank Employees Pension Regulations is guaranteed only on the pre-condition of maintaining future good conduct [Regulation 42] & right of Banks to withhold the pension [Regulation 43]. Hence for all intent and purposes Banks (Pension) Regulations are drafted on similar lines. 10. Like the Bank Employees Pension Regulations 1995, under the CCS Pension Regulations, 1972 as well, the initial pension at the time of retirement is arrived at by taking into account the average emolument for last 10 months of service [see Regulation 34 of the CCS (Pension) Regulations) and even though CCS Pension Regulations specifically do not state so, the basic pension is revised as it is inherent to do so, with each pay revisions thereby extending equal treatments to their serving employees as well as pensioners unlike the Banks. Under the CCS Regulations there is also provision for additional pension for those retirees who are 80 years or above of age. [Refer to Office Memorandum dated 04.08.2016 Sub: Implementation of Government's decisions on the recommendations of the Seventh Central Pay Commission - Revision of pension of pre-2016 pensioners/family pensioners etc]. The liberalized pension scheme was introduced only by the Fifth Pay Commission and parity among the pensioners was achieved in almost entirely in the Sixth and Seventh Pay Commissions. 11. A comparison would show that increase in basic pension, in case of CCS pensioners, due to revisions over all these years was about 17 times. On the contrary, in case of Banks’ Pensioners, despite absence of any restriction or prohibition for upward revision of pension in the Bank Employees Pension Regulations, the pension once fixed remains stagnant for the entire life of the pensioners. 12. Hence, the only difference in the Banks’ Pension Regulations vis-a-vis CCS (Pension) Regulations 1972 is lack of intent on the part of the Banks and IBA, Central Government to effect such revisions in case of Banks’ Pensioners. In fact, there is no provision either for revision of pay of existing employees of Banks. However same is also done by Government notification using the powers under Sec 19 (2)(f) of the Banking Companies (Acquisition & Transfer of undertakings) Act 1970 and amending the Staff Regulations at five-yearly intervals as and when the same becomes due and payable. 13. In terms of Regulation 37 of Bank Employees Pension Regulation Act, Banks having itself accepted that dearness relief is to combat inflation, cannot lose sight of the fact that without merger and giving weightage, the effect of the inflation cannot be nullified. Given that avowed objective for giving Dearness Relief, the same cannot be given and computed in a manner that different amount of pension and dearness relief is paid to different retirees, who have retired from the same rank. Inflation / rising price is something that affects all equally and therefore there cannot be different remedy. Even in D S Nakara case, this is the very aspect that was examined by the Supreme Court and considered. 14. Valuation of present day inflation benefits [such as dearness relief] at the currency value prevailing in years 1993 or so, is a gross injustice to the pensioners. Concept of merger of dearness allowance/relief with revision of pay scales is inherent and is therefore also followed by the Central Government. The total pension of the retirees of Banks i.e the basic pension and dearness relief is a far cry for protecting them from the effect of inflation, given the fact that the inflation affects everyone equally. 15. By arriving at the amount of the initial basic pension at the time of retirement and calling it fixed once for all and denying the benefit of merger or for that matter, the weightage rise every five years with pay revision, the IBA/Banks/Government is doing gross injustice to the pensioners, who have spent their entire active life serving the respective Banks with utmost commitment and sincerity. III. NO DENIAL OF DISPARITY, ARBITRARY AND UNEQUAL TREATMENT 16. It is submitted that there is no denial of the fact that in Banks, there is huge disparity and discrimination among the pensioners on the basis of their dates of retirement. On account of this non-updating of pension, a situation has arisen that a very senior executive in the rank of General Manager who retired 20 years back, is getting lower pension than the Clerk retired recently. The retirees who are in advanced age of 70 years plus, whose medical care expenses and inflation has beaten the meager monthly pension received by them. 17. From the perusal of the above, it would transpire that the pensioner who as 7 ranks higher in post and retired earlier in time is getting much less than what the pensioner who retired in a post 7 ranks lower but retired later is getting. This huge disparity among the pensioners has resulted due to artificial classification of pensioners into various sub-classes on the basis of their dates of retirement which is violetive of Article 14 as well as Article 21 of the Constitution was also held in D.S. Nakara as well as in SPS Vains. Clearly, the other retirees of the same rank would be receiving a higher pension than those retiring earlier. 18. In Union of India vs SPS Vains (2008) 9 see 125, the Hon'ble Supreme Court while keeping the principles laid down in D.S. Nakara in mind held that the object sought to be achieved was not to create a class within a class, but to ensure that the benefits of pension were made available to all persons of the same class equally. To hold otherwise would cause violence to the provisions of Article 14 of the Constitution. The Hon'ble Supreme Court further held that it could not also have been the intention of the authorities to equate the pension payable to officers of two different ranks by resorting to the step-up principle envisaged in the fundamental Regulations in a manner where the other officers belonging to the same cadre would be receiving a higher pension. The relevant extracts of the aforesaid judgment in SPS Vains (Supra) are as under:- a) "28. The question regarding creation of different classes within the same cadre on the basis of the doctrine of intelligible differentia having nexus with the object to be achieved, has fallen for consideration at various intervals for the High Courts as well as this Court, over the years. The said question was taken up by a Constitution Bench in the case of D.S. Nakara (supra) where in no uncertain terms throughout the judgment it has been repeatedly observed that the date of retirement of an employee cannot form a valid criterion for classification, for if that is the criterion those who retired by the end of the month will form a class by themselves. In the context of that case, which is similar to that of the instant case, it was held that Article 14 of the Constitution had been wholly violated, inasmuch as, the Pension Regulations being statutory in character, the amended Regulations, specifying a cut-off date resulted in differential and discriminatory treatment of equals in the matter of commutation of pension. It was further observed that it would have a traumatic effect on those who retired just before that date. The division which classified pensioners into two classes was held to be artificial and arbitrary and not based on any rational principle and whatever principle, if there was any, had not only no nexus to the objects sought to be achieved by amending the Pension Regulations, but was counterproductive and ran counter to the very object of the pension scheme. It was ultimately held that the classification did not satisfy the test of Article 14 of the Constitution. b) The Constitution Bench has discussed in detail the objects of granting pension and we need not, therefore, dilate any further on the said subject, but the decision in the aforesaid case has been consistently referred to in various subsequent judgments of this Court, to which we need not refer. In fact, all the relevant judgments delivered on the subject prior to the decision of the Constitution Bench have been considered and dealt with in detail in the aforesaid case. The directions ultimately given by the Constitution Bench in the said case in order to resolve the dispute which had arisen, is of relevance to resolve the dispute in this case also. c) However, before we give such directions we must also observe that the submissions advanced on behalf of the Union of India cannot be accepted in view of the decision in D.S. Nakara's case (supra). The object sought to be achieved was not to create a class within a class, but to ensure that the benefits of pension were made available to all persons of the same class equally. To hold otherwise would cause violence to the provisions of Article 14 of the Constitution. It could not also have been the intention of the authorities to equate the pension payable to officers of two different ranks by resorting to the step up principle envisaged in the Fundamental Regulations in a manner where the other officers belonging to the same cadre would be receiving a higher pension. " IV. PAY COMMISSION REPORTS 19. a) The concept of pension and the principle laid down to grant the same in the various judgments including in the Constitutional Bench in D.S. Nakara (Supra) [some of them referred above] are the avowed principles, which have never been diluted. In fact, from the perusal of the Pay Commission reports, it would transpire that this principle in D.S. Nakara was the very foundation for the Fifth, Sixth and Seventh Pay Commissions recommendations. 20. The Fifth Pay Commission Report III para 126.7 at pg 1745 of the Fifth Pay Commission Report, the Pay commission noted that:- a) "126.7- We would like therefore to state at the outset that we respect the observations of the Hon 'ble Court in the Nakara Case. It needs to be averred empathically that pension is not in the nature of alms being doled out to beggar. The senior citizens need to be treated with dignity and courtesy befitting their age. Pension is their statutory, inalienable, legally enforceable right and it has been earned by the sweat of their brow. As such it should be fixed, revised, modified and changed in ways not entirely dissimilar to the salaries granted to the serving employees. " 21. The Pay commission in para 127.17 at pg 1747 further no that: b) "127.17 -We have attempted a major policy thrust, by suggesting a complete parity between past and present pensioners at the time of the Fourth CPC, while recommending a modified parity between pre-1996 and post- 1996 pensioners. The formula will ensure that total equity as between the persons who retired before 1986 and those who retired later. It also gives all pensioners at least the minimum pension appurtenant to the post-1996 revised scale of pay of the post they held at the time of retirement" 22. Similarly, based upon the recommendations made by the Sixth CPC in paragraph 5.1.47, the revised pension of the pre-2006 retirees was made minimum 50% of the sum of the minimum of the pay in the Pay Band and the grade pay thereon corresponding to the pre-revised pay scale held by the pensioner at the time of retirement. 23. In the Seventh Pay Commission also sanction was accorded which was applicable to about 52 Lakh pensioners and Government expenditure towards upgradation of pension, while referring to various judgements of the Hon'ble Supreme Court including D.S. Nakara, the pension was revised by resorting to modified parity by applying a fitment factor of 2.57. The relevant paras of the Seventh Pay Commission are as under:- ('10.1.54 The Commission is of the view that the issue of parity in pensions is extremely important from the viewpoint of inter-temporal equity and merits a careful examination. 10.1.56 Till the III CPC, it was a general view that past and future pensioners cannot be treated at par and the practice was that benefit of improvement in the pension would be available to newly retiring pensioners from a prospective date. In fact the III CPC took the view that serving government employees and pensioners could not be treated at par as regards grant of DA at the same rate. A significant change in the paradigm for treatment of pensioners, past and future, emerged from the judicial pronouncement in D.s. Nakara vs Union of India in 1982 (AIR 1983 SC 130), based on which, for the first time, improvements in pensionary benefits were extended to pensioners who had retired prior to the date from which improvements became effective. 10.1.57 The IV CPC recommended, for both civil and defense pensioners, additional relief in terms of a percentage increase in amount of pension subject to a certain minimum increase. Separate rates were applicable to pensioners drawing pension up to Rs 500 per mensem and those above Rs. 500 per mensem. 10.1.58 The V CPC made a definitive shift in the treatment of past pensioners. The Commission took the view that the process of bridging the gap in pension of past pensioners, set into motion by the IV CPC by grant of additional relief in addition to consolidation of pension, needed to be continued so as to achieve complete parity over a period of time. It, accordingly, recommended that pension of all the pre-1986 retirees may be updated by notional fixation of their pay as on 1 January, 1986 by adopting the same formula as for the serving employees. The consolidated pension so arrived at was to be not less than 50 percent of the minimum pay, as revised by V CPC, of the scale of the pensioner at the time of retirement. This principle by which past pensioners are brought up to the minimum of the scale which replaced the scale in which the pensioner retired has been termed as modified parity. This consolidated amount of pension was to be the basis for grant of dearness relief in future. 10.1.59 The VI CPC noted that modified parity had already been conceded between pre and post 1 January, 1996 pensioners. It also observed that full neutralization of price rise on or after 1 January, 1996 had also been extended to all the pensioners. Therefore, the Commission felt that no further changes in the extant Regulations were necessary. To maintain the existing modified parity between present and future retirees, it recommended that those who retired before 01.01.2006 be given the same fitment benefit as was recommended for the existing government employees. 10.1.60. The above points to a distinct transition in the view taken by successive CPCs and the government, beginning with the III CPC. The V CPC, by recommending that pension of all the pre-1986 retirees should be updated by notional fixation of their pay, made landmark advancement in the regime for past pensioners. In principle, the VI CPC proposed provision of the same modified parity as was envisaged in by the V CPC. However, the new pay structure introduced by the VI CPC, based on running Pay Bands and Grade Pays, led to the bunching of a number of pre revised pay scales into a particular Pay Band, thereby diminishing the benefit of the intended modified parity. This naturally led to several representations following which certain corrective orders were issued by the government, some of which were based on the orders of various Court. 10.1.64 Pension Payout to Personnel in the Central Government: The preceding paragraphs bring out the evolution of the pension regime over time and the role of the Judiciary in settling the law on the subject. There is clear evidence that governments have progressively moved towards a liberalized regime for past pensioners. The VI CPC has further provided for additional pension with advancing age. What this has effectively translated into is testified by examples of pension fixation of personnel across groups who have retired in the past decades. For example a Secretary to the Government of India retiring on 31 August, 1992 was in receipt of a basic pension of Rs 4,000 per month. The basic pension after implementation of the V and VI CPC got revised to Rs 13,000 and Rs 40,000 respectively. With the benefit of dearness relief this pensioner is on date entitled to a total payout in terms of pension and dearness relief of Rs 87,600. Further, as a pensioner who is over 80 years of age he is entitled to an additional pension equivalent to 20 percent of basic pension. In effect the pensioner is in receipt of a total payout of Rs 105,120 per month as on date. Similarly, a Director (in GP 8700 as per VI CPC) retiring on 30 September, 1994 with a basic pension of Rs 2,556 per month got revised basic pension of Rs 7,042 and Rs 22,701 per month after implementation of the V and VI CPC respectively. With the benefit of dearness relief the pensioner is on date entitled to a total payout in terms of pension and dearness relief of Rs 49,715 per month. The basic pension for a Group 'C' official retiring on 30 September, 1991 from the scale of Rs 950-1500 was fixed at Rs 717 per month. His basic pension, after implementation of the V and VI CPC, got revised to Rs 2,188 and Rs 4,946 respectively. With dearness and pensionary increase due beyond 80 years the pensioner is in receipt of a total payout of Rs 12,998 per month. " 24. Hence from 5th to 7th Pay Commissions the pension scheme was gradually liberalized and there was paradigm shift in pension payment to more than 52 Lakhs Central government Pensioners and modified parity has been achieved by notional fixation of pay to arrive at revised pension with each pay revision 25. In fact that at one point of time, the Indian Banks Association (IBA), while acknowledging the prevailing disparity and discrimination among the pensioners, intended to revise the pensions upward. However the same was not acted upon by the Central Government. 26. In para 25 of the Supreme Court judgement in Civil Appeal Nos. 8959-8962 of 2013, No. 6995 of 2013, No. 9223 of 2013 and No. 9409-9410 of 2013 dated 31.03.2016 [pg 305 of the Writ Petition], between LIC of India and others vs. Krishna Murarilal Asthana and another, the Hon'ble Supreme Court also took notice of this fact. The Hon'ble Supreme Court further observed that Life Insurance Corporation of India should be gracious enough to recognize the services rendered by them and the Union of India should have come up with affirmative response and that background granted interim payment. 27. In para 1 of the Supreme Court judgment in above civil appeal, the Hon’ble justice observed that Pension though, by the judicial prouncements, has been treated as not a bounty yet the controversy relating to the said claim and denial thereof has been a matter of frequent cavil between the employer and the employee in numerous situations. And that is why this Court has been required to deal with and render judgments pertaining to Pension and interpretation of the rules or policies or schemes relating thereof 28. In para 28 of the Supreme Court judgment in above civil appeal also observed that: a) It is a case where we are constrained to speak that the end does not bring the finality as would contend that the parties to the litigation shall only get the benefit and not the similarly placed persons in view of the interim order passed by this court on 07.05.2015. It does not require Solomon’s wisdom to state that the interim order is an interim order and does not have any impact at the time of final verdict especially in such a situation and, therefore, we direct that it shall be applicable to the similarly placed persons. V. PENSION SCHEME UNDER THE BANK EMPLOYEES PENSION REGULATIONS IS NOT A SELF FUNDED SCHEME 29. Much emphasis has been placed by Banks/IBA/Central Government that the Pension Scheme under the Bank employees’ Pension Regulations is a self-Funded Scheme. It is stated that the Pension scheme in question is not a contributory or self-funded scheme as sought to be projected by Banks/IBA. The Pension Scheme is governed by Banks Employees’ Pension Regulations. Under the Pension Regulations, a Fund has been constituted with sole purpose to pay pension to the beneficiaries under these Regulations [Regulation 5. Which read as under: Regulation. 5. Constitution of the Fund:- (1) The Bank shall constitute a Fund to be called the (Employees’) Pension Fund under an irrevocable trust within one hundred twenty days from the notified date. (2) The fund shall have for its sole purpose the provision of the Payment of pension or family in accordance with these regulations to the employee or his family. (3) The Bank shall be a contributor to the Fund and shall ensure that sufficient sums are placed in it to enable the trustees to make due payments to beneficiaries under these regulations. 30. Under these Regulations, even Banks has a statutory obligation to ensure that adequate sum is made available to enable the Trustee of the fund to pay the amount due under these Regulations [Regulation 5(3)], including sum towards shortfall resulting from upward revision [Regulation 13). Hence, the benefits payable under the Banks Pension Regulations unlike other funded scheme are not limited to the corpus of the fund, or contribution made by employees, as is the case in contributory funds! Or self-funded scheme. Rather the Pension Regulations impose a legal obligation upon Banks to ensure that adequate funds are made available by Banks to enable the Trustee of the fund to pay the amount due under these Regulations. 31. The payment of pension therefore, is not circumscribed by the Fund constraint. It is a statutory obligation imposed on Banks under the Pension Regulations and whatever becomes due and payable and it is an obligation of Banks to meet the shortfall under Regulation 5(3) of the Pension Regulations. Hence the Scheme contemplated in the Bank Employees Pension Regulations is not a contributory scheme rather the fund is created to ensure payment of pension with an obligation on the part of Banks to meet shortfall in the said fund. VI. BENEFICIAL PROVISIONS ARE PARTS OF THE BANK EMPLOYEES’ PENSION REGULATIONS THEMSELVES 32. From a combined reading of Regulation 5 (1), (2), 5(3) read with Regulation 13 and Regulation 56 of the Bank Employees Pension Regulations 1995, it is quite evident that revision of Pension is contemplated in the Regulations themselves, i.e. the Fund is created to ensure the payment of pension, with a statutory obligation on the part of Banks to ensure that sufficient sums are placed in the fund to enable the trustees to make due payments to the beneficiaries under the Pension Regulations including upward revision as contemplated under Regulation 13 of the Pension Regulations. 33. It is further stated that Regulation 13 provides for upward revision "subject to availability of fund" to be provided by Banks under Regulation 5(3). The expression “The Bank shall be a contributor to the Fund and shall ensure that sufficient sums are placed in it to enable the trustees to make due payments to beneficiaries under these regulations.” Hence, from a combined reading of Regulation 13) read with Regulation 5(3) of the Banks Pension Regulations, it is evident that upward revision is inherent in the Pension Regulations itself without any financial constraint of Fund. 34. Be that as it may, there is certainly no restriction in the Bank Employees Pension Regulations restricting the revision of pension. Assuming that the Regulations do not provide for such revision, but Banks being a State has to then implement the Regulations in a manner that there is no discrimination and arbitrariness. However it is the convenient, restrictive and selective reading of the Bank Employees Pension Regulations, which is a beneficial scheme, by Banks to its comfort and to deny legitimate demand of the pension, which has resulted in huge disparity and discrimination among the pensioners on the basis of the dates of their retirement. 35. Despite absence of any specific provision in the Staff Regulations providing for pay revision, revises the pay of existing employees every five years and has justified the same to be as a matter of convention, though it is actually a matter of necessity and right. Similar so-called convention cannot be denied to the pension retirees by giving arbitrary treatment. 36. The Bank Employees Pension Regulations provide for fixation of initial basic pension at the time of retirement by taking into account the average emoluments for the last 10 months. This provision to arrive at the "initial basic pension" is pari materia with Regulation 34 of the CCS (Pension) Regulations 1972. However it cannot be construed to mean that this initial Basic Pension would remain fixed for all time to come especially when there is no such constraint or prohibition under the Regulations. 37. It is stated that unlike Banks Pension Regulations [Regulation 13], there is no provision for upward revision of pension under the CCS (Pension) Regulations, however same is revised periodically as a matter of "convention" at the time of every pay revision through Pay Commissions' recommendations and Government directives /instructions. Hence right to equality and equal treatment demands that similar "convention" should also be followed in case of Banks Pensioners. 38. Hence such an arbitrary and unjust treatment being extended by the Banks/IBA/Central Government to its ex-employees by keeping their pension stagnant for their entire life, especially when there is no such prohibition or restrictions under the Bank Employees Pension Regulations for upgradation of pension and creating sub-class among the pensioners on the basis of their date of retirement is wholly untenable and violetive of Article 14 and 21 of the Constitution of India. VII. CLOSED CATEGORY AND FAST REDUCING NUMBERS 39. The Pensioners as a whole being a closed category, it is a only a question of time in the not distant future that the last Pensioner/Family Pensioner would cease to exist and the pension liability thereafter to the Respondent would be nil. 40. One more important aspect is that the proportion of the number of family pensioners are on rise at rapid pace in comparison to growth in number of pensioners, where the obligation to pay is only 30% of the actual gross regular pension. This will again reduce the pension payout substantially. 41. It is further stated that Banks, very cautiously, did not disclose about the huge corpus [for FY 2015-16] in the Pension Fund and admittedly __ annual interest from investment of the corpus, which the Pension Fund generates, every year. The pension Regulations [Regulation 5) provides that the entire corpus including the interest income generated therefrom is meant only for the present and future pensioners and cannot be used in any other manner. We further state that With regard to cost factor, the PSU banks have adequate/enough pension funds as on 31.03.2015. The quick glance of the position is as under: PENSION FUNDS POSITION OF PSU BANKS AS ON 31.03.2015 (Amounts in Rs. Crores) Opening Balance on 01.04.15 1,58,782.60 Service Cost 8,237.22 Interest Cost 13,416.15 Benefits Paid 11,783.35 Actuarial Gain/Loss +11,807.09 Closing Balance on 31.03.15 1,80,459.71 42. Without prejudice to Petitioner's submission that it is well settled that financial implications cannot be the basis to deny the legitimate and statutory claims. 43. Without prejudice to the aforesaid, assuming that the figures quoted as above is to be correct, it is submitted that cost of upgradation for future pensioners i.e. existing employees, which is not an immediate liability and will become due and payable at successive intervals as and when the employee retires and remaining as shown as the cost towards the Petitioners. It is further submitted that the aforesaid actuarial cost taken into account, the entire cost of arrears towards the Petitioners for a period of many years [i.e. from 1997 to 2017 would be merely one fifth of the annual expenditure on salaries and other benefits for FY 2015-16. Similarly the cost for future upgradation will relate to existing pensioners while taking into account their future upgradation as demanded. Hence even, the anticipated cost for existing pensioners [which includes arrears for past 20 years as well as anticipated cost for upgradation of pension in future], is less than annual payout towards salaries. 44. On the basis of the information available with the Petitioner, the present Pension outgo expenses constitute negligibly small percentage of the Bank employees’ Pension Corpus Fund. Hence, considering the Management Expenses and the salary expenses of the Banks, the financial implications resulting from the reliefs claimed in the present petition is miniscule. It is further stated that it is not appropriate for the a model employer like Banks/IBA/Central Government to cite cost constraints to deny the pension revision while overlooking every other major components of management expenses, that too when the former is a statutory obligation and an employee welfare measure, while not all others including wage revision, are much bigger but not mandatory. 45. It is also a matter of record that despite periodical revisions of pay and other huge operating expenditures of Banks, there has been no impact on the Dividend paid to the Central Government, rather same have gone up over the years. 46. The Petitioner on the basis of information available from the published annual report of Banks, has made some working which would prima facie falsify the plea of financial impact being raised by the Banks/IBA/Central Government. 47. As per Supreme Court Judgment in Civil Appeal Nos. 8959-8962 of 2013, No. 6995 of 2013, No. 9223 of 2013 and No. 9409-9410 of 2013 dated 31.03.2016 between LIC of India and others vs. Krishna Murarilal Asthana and another, the Honble court while ordering interim benefits, has instructed the Honble Delhi High Court to get all the cases from other courts in similar matters and dispose of the same within September 2016. The Hon'ble Supreme Court further observed that Life Insurance Corporation of India should be gracious enough to recognize the services rendered by them and the Union of India should have come up with affirmative response and that background granted interim payment. 48. Accordingly, Retired LIC Class-I Officers Association, Hyderabad Division have Petitioned their issue for updation of pension & other benefits before the Hon’ble High Court of Delhi, at New Delhi under Writ Petition No. 4894 of 2016 making the Life Insurance Corporation of India & others as parties to the Petition. We understand that the case is in final stage of judgment as the Retired LIC Class-I Officers Association, Hyderabad have already submitted their final written statement. 49. Despite, ill treatment meted to the Bank Retirees/Pensioners by the Banks/IBA/Central Government during the last three decades, none of the representative Unions/Associations of Banks have shown any concern to initiate any redressal mechanism though knowingly very well that our Bank Retirees, Pensioners case is also Similar, Corresponding and akin to LIC Retirees grievances as stated above VIII. FINANCIAL IMPACT ON BANKS 50. Further, it is wrong to contend that meeting the legal obligation like pension payment including its periodical revision, would lead to penal consequences. On the contrary the revised Regulations clearly provide opportunity to the Banks to explain the reasons for the essential increase in expenses as in the case of legal obligations like pension revision as well as the substantial cost of regular, periodical wage revisions that are admittedly not even mandatory but incurred as mere convention. The Regulatory limitation if any, on Expenses of Management is intended to check the avoidable or questionable expenses and not for denying what is legitimately due towards pension payments. As stated above, the pension payout constitutes a small fraction of various other expenses of Banks including salaries payout and pay revisions. However, the apprehension shown by Banks/IBA in the present case has never been cause of concern, when it comes to other expenditures including those caused by periodical pay revisions. It is stated that there are number of areas and other expenditure where Banks can regulate and limit its expenses and safeguard the interest of its constituents. Hence in view of above, our Petition addressed to the Hon’ble Prime Minister and Finance Minister deserves to be considered to remedy the huge disparity and discrimination among the Pensioners, which is violetive of Article 14 and 21 of the Constitution of India and to issue direction to the Banks/IBA to revise Bank Retirees/Pensioners, their pensions accordingly to remove prevalent disparity and discrimination among the pensioners of employees under Central Pay Commissions and give them equal treatment without any discrimination. Thank you and hope the natural justice will be reinstated at the earliest. JAYAPRAKASH. N & OTHERS. PETITIONERS:
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