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| A Look through the mist : | | | Growing burden of Pension to Government Employees :: Is no retirement pension a solution ?
By Daya Sagar
The Jammu and Kashmir State Cabinet on 29th August approved a New Pension Scheme to be implemented from January 2010 discontinuing existing provisions of pension to the government employees recruited there after . Government of India has already done away with pension to those appointed from 1/2004. As per the indications received there would be a fund almost on the pattern of Contributory Provident Fund , some what similar to what is for those employed in PSU / PSE /Private companies .
The pensionary benefits to retired government employees / their families have attracted critical attention of economists. Common man too is critical of salaries to government employees since government departments have failed to truly perform their duties. The government officers are seen as masters. Then Indian Finance Minister Pranab Mukherjee told ( 16 Feb 2009 } Lok Sabha that implementation of Sixth Central Pay Commission for central government Employees would benefit over 4.5 million Central Government Employees {including Defence forces and Para-Military forces } and over 3.0 million Pensioners. To this I will add that there may be another 20 million employees with state governments. Mukherjee had also informed the National Development Council that by fiscal 2009-10, the joint liability of States and the Centre on account of pension alone was likely to be over a Rs 1,00,000 crore. Where does the money come from to give salaries to millions of government employees? A part of salaries and hikes as paid to Government servants is indirectly also paid for by nearly the 38 to 40 Million Indians who are not government employees {work outside the government }. There is very large requirement of government employees in a democracy like India ( with population of over 1100 million} and the number of ex government employees too grows with time.
After implementation of VI th pay commission it has been noted that some ex retired employees who retired around the year 1995 would get pension nearly 2.5 times the salary they were getting in 1995 . Some cases are there where pensioners have got pension for about 40 years. These days many government servants are getting pension of Rs.30000 to Rs.40000 pm which is like some one getting interest income from a fixed deposit as large as Rs.40 to 50 Lac. More over the pension keeps on revising every 10 years. On the other hand many senior citizens who retire from private jobs live miserable life without pension since in most cases their savings are meager . So they have to keep on working till they finally "collapse". The position of those retiring from private sector companies and government public sector PSU is bad. In case CPF is to match the magnitude of pension benefits to government servants , CPF contribution by employer has to be not less than 20 to 25% of the pay. So far the CPF( 8.33%/ 10%/ 12%) ) provides much lesser security . So in case the special provision of pension to government employees has to go ,the contribution by government to pension fund { like CPF} should not be less than 20 to 25 percent of the basic pay . Only then such change can match the present level and norms of pension.. Government of India need to review orders issued for those employed after January 2004. JK Government must keep this in mind while framing the rules for discontinuing pension wef January 2010.
Why should government in a socialist country like India pay pension to only retired government servants and not all those who do not have regular income, could be a question?. Surely the immediate reason for raising such question could be due to limited resources. No doubt some pension schemes for private sector too have been proposed. But most of such schemes are to be funded { fully / partly} by the beneficiary himself. But the pension so far paid to government employees is fully funded by the State. Government Employee Pension scheme has so far been the best of all available pension scheme in India.
But at the same time sanctity of public service has to be maintained .We must try to know why at all the provision of pension to government servants was there in British India and was later carried in Indian republic. The government servants in a democracy have to administer the management of the material, social , administrative, security and economic affairs for the people of the Country. Job involves responsibility with authority to use the common resources pooled by society (national wealth and tax contribution } . Safeguards for trade practices, choice for practicing customs and beliefs of one’s liking, security against criminal activities and dangers from across the borders are provided by the State. There is no King to govern . Representatives are designated / authorized by the people to govern their own self. The government employees have to collect and spend the contributions ( taxes etc } and provide security to the common man against dangers to life and property. SO they { government servant }are vested with an authority to even “GOVERN” the Employer ( the people }.The government employees were hence denied collective bargaining power which is available to workmen in industries / in the private sector. .In return a government employee is provided job security and was debarred from entering into any regular trade / business during his service time. This was conceived with the objective that a government employee should not have material interests in trade.
Those employed in government had to one day grow old and hence would be in a stage where they could not that affectively perform the duty towards the society. But since during their active service they were debarred from taking to any business enterprise / income generation activity in private they had to be supported for their material needs after they were retired from service . So was the provision of retirement pension kept for the government employees. Of course this was a liability to be carried by the government at the social cost and has been growing over the years to the extent that the Governments started feeling over stressed by the pension liability. Now since the salaries paid to government employees have these years nearly proved non yielding interms of social and economic security to the common man, when ever the salaries of the government employees are increased through pay revision or release of DA people outside government service raise questions ; and now when the Central Government ( wef 1 January 2004 } and Jammu and Kashmir Government { wef 1 Jan 2010} have announced for no pension to recruits there has been overwhelming welcome from the general public. Where as had the government machinery sincerely and honestly delivered the services to the people the output would have appeared too satisfying in comparison to salaries and pensions paid. In addition to this indirect unionism also started in government departments and the wage structure and facilities for the government employees were revised periodically. Since the government employees themselves were the limbs of the government the wage revision policies got influenced under self interest of the employees. With times passing the government departments also became non committal and welfare programmes, the collection of revenue, the expenditure from the state exchequer was corrupted by government machinery. As on date even a Director or Secretary School education feel it below dignity to send their children to Government schools. They are like that Halwaee who prefers not to eat sweets from his own.
The concept behind pension to government servants who are debarred from any private enterprise / business participation during service was very very sacred but now since the government machinery is not delivering and the social services ( education, health, security, law& order, revenue records,) provided by government are not yielding, the life of people has become difficult and hence people feel pension as a burden on the society. So there was a welcome response to Government of India deciding not to pay pension. No doubt the defence services have been kept out of the plan { this was surely not correct since all government employees should be treated at par}. This action of government does not test good to logic since the concept behind the provision of pension and job security to government employees was very pious. I agree that the Government employees are rarely performing honestly .But it will not be wise to undo the special provision for pension for them. Instead why not make the Government employees deliver and even remodel their service code if needed. More than 70 percent of poor India depends on government schools and hospitals. Bad performing government institutions can compel people to go for unfair means for buying basic services from the private sector. Let the government employees be told that they have to perform for people at what ever salary society can give them from the common pool and in case they find it less they could take to better employment some where else. Rather they need be explained concept behind pension. In case government still is not convinced with this reasoning then why pension has not been discontinued for MLAs and MPs , ex service men and the like when it has been discontinued for the government employees ?
In a democracy government servants delegated with authority to administer are an unavoidable need of the society. Better make government employees to deliver than denying them pay increases and pensions. The government employees have still to manage the public funds and resources. Therefore, provision like pension on retirement as it existed must stay on. In case the pension provision is removed , the government employees would not that much feel obliged to keep secure the common properties / resources. The government doctors must be debarred in totality from doing private practice. Atleast in J and K most of the private nursing home are supported by Government Doctors. This has to be discontinued. If still it is to be kept then why to de bar engineers in government service from taking to part time consultation business.
Rather government must additionally come up with a security system for payment of pension to those who work in the private sector and have this way or that way contributed to tax revenue during their active days. The pension to every senior citizen should not be less than Rs.10000 per month at todays norms with growing material and health needs . This has been particularly kept in view by the Pay Commissions while deciding the matters regarding government servants. Let it be part of training curriculum at employees training / officer training institutes of the government. The concept of no private enterprise need be redrafted even laying down that a government employee is debarred from buying and selling properties for raising money. No employee who has any residential property in his name should be allowed to buy another property to be sold on profit later on. Such act too falls under private enterprising for money .
Daya Sagar , social activist, free lancer senior coloumnist of Kashmir Affairs
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