Minimum Pay/Fitment Formula & National Pension Scheme (NPS)-Letter

We have written a letter, on behalf of CCGGOO, to the leaders of all Political Parties discussing two pressing issues (namely, Minimum Pay/Fitment Formula determined after 7^th Central Pay Commission and the National Pension Scheme or NPS), affecting more than One Crore Central and State Government employees (including PSU, Local and Autonomous Bodies) for their kind perusal and with the request to kindly impress upon the next Central Government to address the issues. The letter has already been submitted to the leaders of most of the major National and Regional Political Parties and the Text is given below.

We, on behalf of the Confederation of Central Government Gazetted Officers’ Organizations (CCGGOO), are writing this letter at the time, when the entire country is going through the process of General Election to Lok Sabha, 2019. Naturally all issues, considered as relevant by the people of India, are being discussed and debated.

CCGGOO, the umbrella organization for all Central Government Group B Gazetted and Group A promotee officers’ Service Associations, cutting across the Departments, is specifically concerned about the issues pertaining to the Central Government employees. Among many such issues, we believe that the following two issues are bothering the Central Government employees including Gazetted Group B and Promotee Group A Officers most and therefore, need a little elaboration.

A. 7^th Central Pay Commission; Fitment factor and Minimum Pay: You are aware that Central Pay Commission (CPC) is the mechanism of reviewing the pay, allowances and other general service conditions of all Central Government employees irrespective of the grades (including all uniformed officers and personnel of defence forces and paramilitary forces like CRPF, CISF, BSF etc.) in a regular periodicity of 10 years. The 7^th CPC's recommendations were implemented w.e.f. 01.01.2016. The basic focus of any CPC report is the determination of Minimum Pay and the Fitment Factor, as that is the basis of the pay structure for all cadres under consideration.

7^th CPC failed to appreciate the proposed minimum pay and the fitment factor proposed by the entire Central Government Workforce before the CPC (Rs. 26,000/- applying the fitment factor of 3.7), along with the detailed workings on the basis of the International Labour Organization's approved formula (commonly known as Dr. Wallace Aykroyd Formula which was relied upon by consecutive CPCs). The 7^th CPC worked out the minimum pay as Rs. 18,000/- applying the fitment factor of 2.57, relying upon some unscientific criteria.

Despite repeated representations by the Central Government employees and service associations including Confederation of Central Government Gazetted Officers Organisations, discussions with the authorities and the assurances given, the fitment factor remains unchanged and the minimum pay is being kept at Rs. 18,000/- only. This decision has not only dashed the hopes of lakhs of Central Government employees, but  also has disappointed crores of State Government employees, employees of the Central & State PSUs, Local Bodies and Autonomous Bodies, even the employees of Private Sectors, as the minimum pay of the Central Government employees is always the reference point for the others. It will be agreed that a satisfied workforce of Central and State Governments is always of prime importance, as they are the key for implementation of all Government Policies. Denial of the proposed Minimum Pay and the Fitment Factor has literally left more than one crore families across the country disappointed and disgruntled.

B. National Pension Scheme (NPS): You will appreciate that a pension scheme, consistent with available resources, should enable a pensioner to live a decent, poverty free, dignified post retirement life, consistent with the standards enabled by the wages paid to him while in service. Pension is not a gratis granted by an employer at his discretion. Pension is not an ex-gratia payment. Indeed it is a payment for the past service rendered, akin to deferred wages. It is a social welfare measure for rendering socio-economic justice to those, who in the heyday of their life ceaselessly toil for the employer on an assurance that in their old age they would not be left in the lurch. Pensioners’ form a class by themselves and this class is not divisible for purposes of entitlements and payment of pension to those who retire ‘before’ and those who retire ‘after’ a certain date.

The introduction of ‘New Contributory Pension Scheme’ or NPS for those who joined Central Civil Services on or after 01-01-2004 has negated the element of assurances with no guarantee of any minimum pension or any commitment to pay pension by Government. By introducing New Pension Scheme, two classes of pensioners have been created by the Government as pensioners who had joined service prior to 01-01-2004 and those who joined service on or after 01-01-2004. Those, who joined service in the Central Government prior to 01-01-2004 and retired, are now getting minimum pension of Rs.9000 plus DR per month.  But those who joined service after 01-01-2004 have no such assurance of a minimum pension, as they will be at the mercy of the "Market". The quantum of pension being received now by such NPS retirees is only confirming such apprehension.

The above issues have been forwarded from all corners of the staff side to the Central Government seeking to scrap the NPS and bring back the old pension scheme (OPS). The chorus are getting louder, as almost all the State Governments have adopted the NPS, sooner or later, exposing or like to be exposing over a Crore families of this country to uncertainties of the "Market", which they obviously don’t deserve after rendering decades of distinguished service.

Our request:

Despite your extremely busy schedule during this election season, we request you to kindly ponder over the above issues and to appreciate the gravity of the situation. We solicit your indulgence in impressing upon the new Central Government, to be formed after the General Elections, 2019 to address these two prime concerns of more than one crore Central and State Government employees (including PSU, Local and Autonomous Bodies) and their family members.