Withdraw the contributory pension scheme and restore the defined benefit pension to all Central Govt. Employees & Officers.

The main objective of introducing the new contributory pension scheme in 2004 was stated to be to arrest the financial outflow on account of the constant increase in the pension liability of the Government. The IMF had earlier advised the Government to do so as a measure to contain the fiscal deficit in the Union Budget.

 The employees and Officers organisations had been consistently opposing this move and had been presenting the obvious fact that the pension liability of the Government would not be abated by this move, rather it would only register an increase.  The 6^th CPC set up a Committee to go into the matter headed by Dr. Gayatri.   The Committee’s conclusion was akin to what the employees organisations were all along making.

The matter came up for the consideration of the 7^th CPC again as by that  time the new scheme had been in operation for more than a decade. The  Commission received many complaints and suggestions from the stake holders.  These had been enumerated in their report.   Instead of making any recommendation, the Commission suggested to the Government to set up a Committee to go into these complaints and take remedial measures.

 Govt. set up such a committee under the Chairmanship of the then Secretary, Pension, who heard the presentations made by the Service organisations and the Pensioners Associations.   One of the suggestions made before the committee was to guarantee a minimum pension or a minimum return for the investments being made by the employees during their service career.  It is reported that the Committee has submitted its report to the Govt.  But the same has not come to the public domain so far.

 The Pensioners are, rightly so, apprehensive of the continuation of the present defined benefit pension system, they enjoy.  The employees, who are recruited after 01.01.2004 are highly agitated as the new scheme guarantees no mimum annuity nor does the projection made by the PFRDA gives them any hope for a decent return for the contribution they make every month which is presently 10% of their Pay + DA. 

  The  facts now available with the Government over the financial outflow from the exchequer both in respect of the Pension liability of the employees who were recruited prior to 01.01.2004 and the contribution the Government is to make under the new contributory scheme must convince that the decision taken to introduce the new scheme in replacement of the erstwhile defined benefit scheme had been flawed. 

 If that be so, the scheme requires to be scrapped lock stock and barrel as it has not benefitted the Govt,  nor the subscribers, i.e. the employees. The discontent over this ill advised decision is growing day by day and the younger generation of workers and officers have become highly critical.  We, therefore, request you to kindly cause a revisit with a view to bring back the defined benefit pension scheme for all Central Government employees and Officers.