Thursday, February 2, 2012

PENSION UNDER DPE GUIDELINES OF 2008 7 2009 by Narayan Singh Rathore

by Narayan Singh Rathore

Friends, lot of effort has been devoted to Pension under DPE Guidelines. First, Lets see what is OM No.2 (70)/08-DPE (WC)-GL-XVI/08 of 26th Nov.2008: - Board Level and below Board level executives and Non Unionised Supervisors in CPSES-revision of Scales of Pay w.e.f. 01.01.2007. Para 12 of this OM states that "12. Long Term Incentives, introduction of cost to the Company (CTC) concept in CPSEs, Pay of Executives on deputation / transfer to CPSEs, Pay of Government officers on deputation to CPSEs and Superannuation Benefits will be as per Annex.-IV.

Para (V) of Annexure - IV (Para 12): - Superannuation Benefits: CPSEs would be allowed 30% of Basic Pay as Superannuation benefits, which may include Contributory Provident Fund (CPF), Gratuity, Pension and Post - Superannuation Medical Benefits. The CPSEs should make their own schemes to manage these funds or operate through Insurance companies on fixed contribution basis. The amount of Pension, Gratuty and Post Retirement Benefit will be decided based on the returns from the schemes to be operated. The Pension and Medical Benefits can be extended to those executives, who superannuate from the CPSE and have put in a minimum of 15 years service in the CPSE, prior to superannuation.

Second, lets see what important extracts from OM No.2 (70)/08-DPE (WC)-GL-VII/09 of 2nd April 2009, say:

Para 1: "Subsequent to issue of OM dated 26.11.2008, the Government constituted a Committee of Ministers to look into the demands raised by CPSE executives of Oil and Power Sectors."

Para 2. "The Government, after due consideration to the recommendations of the Committee of Ministers have decided further as follows:"

Para 2 (ii). "Superannuation Benefit: The ceiling of 30% towards superannuation benefits would be calculated on Basic Pay plus DA instead of Basic Pay alone. Any superannuation benefit would be under a "deifined contribution scheme" and not under a "defined benefit scheme". CPSEs that do not have superannuation scheme, may develop such scheme and obtain the approval of their Administrative Ministry. However, no other superannuation benefit can be granted outside this 30% ceiling. (Para 12 Annex. IV (V) of OM dated 26.11.2008 refers)

Para 4 "The ceilings mentioned under various items given in OMs dated 26.11.2008, 09.02.2009 and this OM are the maximum permissible limits. However, lower limits against these maximum permissible limits can be provided in the Presidential Directives, depending upon affordability, capacity to pay and sustainability of the concerned CPSE".

Friends, it is reasonably clear that Herculian effort is required to cover retirees earlier than 01.01.2007 or may be later Date when the Scheme (s) is/are introduced and implemented.

Mr. Nirmal Kumar Srivastava had also examined the Concept Papaer prepared by Managing Trustee of ONGC PRBS Trust. Concept Paper was alround confusion confounded.It was aimed to Re-structure existing PRBS ? It makes it amply established fact that Trustees are misguided by their own whims.

No comments:

Post a Comment