Tuesday 24 September 2013
PENSION BILL OR PENSIONLESS BILL?
Finally
the ruling Congress party and the main opposition Party BJP joined together and
passed the Pension Fund and Regulatory Authority Pension Fund Regulatory and
Development Authority (PFRDA) Bill in the Parliament. In the year 1982 on 17th
December, the Constitution Bench of the Supreme Court consisting of Justice (s)
Y. B. Chandrachud, V. D. Tulzapurkar, O. Chinnappa Reddy. D. A. Desai and
Bahrul Islam delivered the historic judgment on pension in the D. S. Nakara
case, which declared as follows:
“(i)
Pension is neither a bounty nor a matter of grace depending upon the sweet will
of the employer and it is Fundamental right (ii) Pension is not an ex-gratia
payment, but it is payment for past service rendered (iii) 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 lurch.”
After
30 years, the bill passed by Parliament categorically proclaims that the
Contributory Pension Scheme introduced w.e.f 01.01.2004 will not give any
guarantee for a minimum pension of 50% of the pay drawn at the time of
retirement of the employee. Nor does it provide for the protection of the
family members in the form of family pension in the event of death. New pension
is going to make the social security uncertain and dependent on market forces.
Government compulsorily imposed the scheme on one section of the employees in a
most discriminatory manner, inspite of the fact that such scheme had been a
failure in many countries including Chile, U K and even in USA. In USA the
entire pension wealth (fund) has been wiped out leaving no pension due to the
economic recession and share market crash. In Argentine the contributory scheme
which was introduced at the instance of IMF was replaced with the defined
benefit pension scheme. In majority of the countries “pay as you go” is the
system of pension.
Government
introduced the contributory pension scheme on the specious plea that the out
flow on pension had been increasing year by year and is likely to cross the
wage bill. In fact, by making the pension contributory, the Government
expenditure on this score is not going to get reduced for the next three
decades because of the reason that as per the new pension scheme, the
Government is to contribute the same amount to the pension fund of each
employee coupled with the stipulation that for the existing Central Government
Employees who were in service prior to 01.01.2004 Government is duty bound to
make payment of statutory pension. The Contribution collected from the
employees who are recruited after 01.01.2004 is to be managed by mutual fund
operators for investment in stock market and thus it is the vagaries of the
stock market which will determine the quantum of pension or in other words
annuity which would be cost-indexed and market-oriented.
The
decision of the Government to allow FDI in pension fund operations has made the
real intention of the PFRDA bill crystal clear. It is now clear that the
decision behind the contributory pension scheme is the pressure imposed by
imperialist powers and corporate houses and more specifically IMF.
NFPE
and Confederation has opposed the new Pension Scheme and the PFRDA Bill from
the very beginning and organized series of agitational programmes against it
demanding withdrawal of the scheme and the PFRDA bill. We shall continue our
opposition and struggle and demand for reversion of the scheme. Let us
intensify our struggle against the neo-liberal economic policies of the
Government jointly with all those forces which supported our cause inside the
Parliament and outside. Let us identify who are our real friends and foes.
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