The Kerala government, earlier this month, replaced the “Defined benefit based” pension scheme by the “Defined contribution based” pension scheme. State government employees went on a six-day strike to protest against the new scheme, which was introduced without taking the employees’ views into consideration
The six-day old strike by state government staff and teachers in Kerala, which was called off on 14th January, was the first serious agitation against replacement of the “Defined benefit based” pension scheme in government service by the “Defined contribution based” pension scheme, through the back door. As all strikes so far by government employees in India, the calling off was just a face-saving compromise, without much result to report home. Still, the issues the strike successfully brought to surface and the eagerness of the state government to somehow get back the employees for work, makes the six-day strike a cause for a re-look at the New Pension System. It was introduced by the Centre for central government employees, excluding majority of defence employees from 2004, legislative support for which is still ‘hanging’. Kerala finance minister KM Mani reportedly had negotiations with employees’ representatives till 12.40am on 13th January night which was followed with a wrap-up discussion between employees’ leaders and chief minister Oomen Chandy which lasted till 1.40am the next day.
There was broad understanding between the government and employees on the following:
Whatever be the arguments in defence of the CPS, a time-tested social security arrangement, available to a section of employees, is being dismantled without any credible alternative system in place. When one refers to social security arrangement, one has in mind all pensionary benefits including family pension. While in the private sector and profit-making public sector undertakings, employees have an opportunity to bargain and settle remunerations based on their skill and market realities, government employees and those employed in quasi-government and statutory bodies are a helpless lot, whose bargaining power is stifled in the name of public interest. It is in this context that they deserve special treatment, at least in respect of social security arrangements like pensionary benefits. The cost savings for the Government of Kerala, if any, will accrue only from the date of retirement of the first employee who joins after 31 March 2013. Till such time, there will be an additional outgo to the extent of the employer’s contribution to the fund in respect of employees joining service from 1 April 2013.
As for the central scheme, NPS has not been made applicable to defence employees who constitute a major proportion of central government employees.
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(MG Warrier is a freelancer based in Thiruvananthapuram.)