INCOME TAX EMPLOYEES FEDERATION
Manishinath Bhawan, A/2/95, Rajouri Garden,
New Delhi 110 027
Telephone No : 2510 5324 Telefax 2513 1593
e-mail : firstname.lastname@example.org Mobile 98694 77401
Circular No.4/2011 30th June, 2011
MEETING WITH CHAIRMAN, CBDT AT MUMBAI
Shri. Prakash Chandra, Chairman, CBDT was in Mumbai on 28th and 29th June, 2011. We took the opportunity to meet him and discuss certain issues: We give hereunder the issues raised and his response thereon:
1. Cadre restructuring Proposal: Chairman informed us that the Director in CBDT has been asked to interact with the concerned in DOPT to clarify the points raised by them so as to avoid the delay. He expects to get the clearance of DOPT within a month's time.
2. Pending Issues: We have handed over him a copy of the minutes of the last formal meeting with his predecessor. He has assured to get the orders/instructions issued by the Board wherever further discussions are not needed. He will meet the representatives of ITEF on 8th July,2011 at New Delhi and if the ongoing JPC meetings are concluded he would meet and address the pending issues on that day itself or shall indicate the date convenient to him.
3. Video Conferencing: We have pointed out the futility of participating in the present format of video conferencing as there is little time to present the case and get response. We have suggested that in view of the paucity of time, the representatives of a particular zone alone may be permitted to raise the issue, so that over a period everybody will get time to interact with the Chairman. Chairman was appreciative of this suggestion and would like to be presented the same for his consideration formally. We seek you view in the matter. What we intend to propose is as under.
A. The date and time of video conferencing will be intimated well in advances.
B. Only the issues a particular zone will be discussed in one conference. The others will have to await their turn for the next and subsequent conferences.
C. The issues concerning a particular charge taken up with the CCITs but not resolved due to the absence of approval or clarification from Board will be raised.
D. The query with the relevant information maybe e-mailed to the Chairman well in advance so that a proper decision could be conveyed in the conference itself.
E. All India issues, which are being addressed formally in the bilateral meetings need not be raised unless the action on decisions are delayed or decisions taken are not followed up by the section heads of the Board.
We feel that if this arrangement is agreed upon, the conference will have a smooth and orderly functioning and everybody will get an opportunity to get their long pending issues projected before the Chairman.
We are placing this letter on the website and request you to kindly convey your views by 6th July,2011 so as to have consideration of it in our Secretariat meeting on 7th July, 2011.
We once again request you to kindly take steps to clear the dues immediately as the CHQ funds are getting depleted.
We send herewith copy of Confederation Circular No.12 and 13 (Please see our website) for information and necessary action. Kindly ensure that for each state ITEF representatives participate in the Convention on 22nd July, 2011.
CONFEDERATION OF CENTRAL GOVT. EMPLOYEES & WORKERS.
A-2/95,Manishinath Bhawan,Rajouri Garden, New Delhi-110 027
Tel: 011-2510 5324: Mobile: 98110 48303
Conf/12/2011 dated 28th June, 2011
Kindly see our website. We have placed a copy of our letter seeking solidarity and support of our sister organizations and affiliates to the postal workers who will commence the indefinite strike action from 5th July onwards. We request all our affiliates and State Committees to organize Lunch –recess demonstration at the respective work spots on 5th July, 2011. The State Committees must ensure that a massive demonstration is organized at the CPMG offices of the State Capital eliciting participation of all CGEs on 8-7-2011 and send the following telegram/savingram to the Secretary-Post, Government of India, Dak Bhawan, New Delhi-110 001 as also to the Communication Minister. Shri Kapil Sibal, Hon'ble Minister for communications, 107, First Floor, Sanchar Bhawan, New Delhi-110 001.
"We express our solidarity with the striking Postal employees. Urge upon you
To hold negotiations with the organizations and settle their demands."
The affiliates may kindly issue necessary instructions to all their Branches to carry out the above programme. Copy of the said communication may please be endorsed to the Confederation CHQ
The National Secretariat of the Confederation will meet on 30th July, 2011 at Chennai and the first meeting of the National Women's convention will also be held on the same day. Copies of notices are placed hereunder. PFRDA Bill
The Government could successfully introduce the PFRDA Bill in the last session of the Parliament with the help of the BJP and others in the opposition. The Bill might come up for discussion and enactment in the monsoon session. In the wake of the attempt in this direction by the UPA-I Government, we had taken the decision to organize a day's strike jointly with AISGEF, the School and University Teachers Federations and the AIDEF. We have been in touch with all these organization for venturing into another serious campaign against the present Bill to culminate in an industrial action. Accordingly we have decided to hold a joint convention on PFRDA Bill at New Delhi on 22nd July, 2011. The venue of the convention will be : M.P.C.U Shah Auditorium, Shree Delhi Gujarati Samaj, No.2, Raj Niwas Marg, Civil lines, Ring Road, New Delhi-110 054 (next to Civil lines Metro Station- Yellow Line)
The convention will commence at 11-30 AM and shall be concluded at 3-30 PM. The convention have the participation of the representatives from AISGEF, Confederation, AIDEF,School and University teachers Federations, and DREU. Other details will be conveyed in our next circular.
N O T I C E
Notice is hereby given for a meeting of the Secretariat of the Confederation to be held at Chennai on 30th July, 201. The meeting will begin at 11-30 A.M. The exact venue of the meeting will be communicated by the Tamilnadu State Committee. The meeting will deliberate upon the following agenda:
(a) Review of the campaign programme if any undertaken to popularize the charter of demands.
(b) To finalise the date for the next phase of programme of action.
(c) The implication of deems taken at the Joint Covention on PFRDA Bill at Delhi on 22-7-2011.
(d) Any other matter with the permission of the Chair.
The first meeting of the women committee formed by the National women's convention at Kolkata will also be held at Chennai at the same venue. The meeting of the women committee will begin at 3-00 P.M. The convenor of the Committee will circulate the agenda for discussion in due course:
N O T I C E
Notice is hereby given for a meeting of the women's committee of the Confederation of CG employees and workers to be held at Chennai on 30th July 2011. The meeting will begin at 3-00 P.M. The following agenda will be subjected to discussion.
(a) Follow-up action required to be taken to implement the decisions taken at the National Conventions at Kolkata.
(b) Finalisation of date of State level conventions and formation of sub-committees for each state.
(c) Steps to improve the participation of women comrades in the programme of action.
National Women's committee of Confederation of CGE and Workers
Address: Sub-Postmaster, Vikas Bhawan P.O. Thiruvanatapuram. 695 033.
Cell No. 9446721330
CONFEDERATION OF CENTRAL GOVT. EMPLOYEES & WORKERS.
A-2/95,Manishinath Bhawan,Rajouri Garden, New Delhi-110 027
Conf.Cir.No.13/2011 Date: 30-06-2011
In continuation of our circular letter No 12, we are to inform you that the proposed National Convention will be held at MPCU Shah Auditorium, New Delhi on 22-07-2011. We give hereunder the quota of delegates for each state and request the state committees to initiate steps to identify comrades as delegates and book tickets for them. We send herewith a copy of the draft letter to be submitted to the Prime Minister obtaining signature from the employees. The draft may come up for discussion at the convention. The convention will also discuss and decided future course of action in the matter. Kindly inform us the addition if any you would like to propose to the draft petition.
With greetings, Yours fraternally,
Quota of delegates
Kerala-2, Tamilnadu-10, Andhra Pradesh-10, Karnataka-5, Mumbai-15, Vidharba-10, Madhya Pradesh-15, Orissa-5, West Bengal-10, North Eastern Region-5, Bihar-5, Jharkhand-2, Chattisgarh-2, Uttar Pradesh-30, uttarakhand-2, Rajesthan-15, Gujarath-10, Punjab-3, Haryana-2, Delhi-15 ,J&K-1
Draft Petition addressed to the Prime Minister
For Signature campaign.
The Prime Minister of India,
Sub: Request for Scrapping of PFRDA Bill
We submit this Petition to bring to your kind notice and through your good office to the attention of the Honorable Parliamentarians of our country certain aspects of the re-introduced PFRDA bill, which will have adverse impact on the exchequer in general and on the prevailing service conditions of the Civil Servants. We pray that our submissions in this regard may please be caused to be considered earnestly and the implication of the provisions of the bill critically analyzed and examined and take decision to kindly withdraw the Bill from the Parliament.
We submit the following for your critical and objective analysis of the Bill :
1. The concept of old age security for civil servant in the form of pension has a very ancient
origin dating back as early as third century BC, the quantum being half of the wages on completion of forty years blemishless service to the king.
2. In the last century, one of the measures taken by the colonial rulers to attract talented
personnel to the Royal service was the introduction of pension scheme for civil servants `in 1920. The Royal commission through its various recommendations improved the scheme and the 1935 Government of India Act provided it statutory strength.
3. The land mark judgment of the Supreme Court in D .S. Nakara and others Vs. Union of
India (AIR-1983-SC-130)(applicable to the Central and State Government employees, teachers, and all stake holders of pension system) conceptualized pension stating that pension is neither a bounty nor a grace bestowed by the sweet will of the employer, but a payment for the past services rendered. It was construed as a right step towards socio-economic justice and a concrete assurance to the effect that the employee in his old age is not left in the lurch.
4. The fifth Central Pay Commission which was set up by the GOI in 1993 to go into the wage structure and pension scheme of the Central Government employees referring to the Judgment of the Supreme Court cited, observed (Para 127.6) that " pension is the statutory, inalienable and legally enforceable right earned by the civil servant by the sweat of the brow and being so must be fixed, revised, modified and changed in the way not dissimilar to salary granted to serving employees."
5. The guiding principle adopted in determining of pay package of civil servants is to spread out
the wage compensation over a long peiord of time whereby wages paid out during the work
tenure is low in order to effect payment of pension on retirement. As such civil service pension
is rightly termed as deferred wage. While in the organized private sector the employer is
required to contribute equal share to the Provident Fund of the employees, the Government
neither contributes to the Provident Fund of the civil servants nor takes any pension subscription from him.
6. In an unwarranted intervention in the Statutory defined benefit Pension system, the IMF in
their work paper (WP/01/125,(2001) propounded the creation of a pension fund by eliciting
from the Wage earners at the earliest stage of their employment so as to fetch an
annuity decent enough to sustain him at the old age. In fact it was a suggestion for a retrograde
change over from the defined benefit pension scheme to a defined contributory system. While
suggesting so, they have categorically stated that India does not suffer demographic pressure
experienced by major countries, for India's population beyond the age of 60 was about 7% in
2004ch rose to 8.6% in 2010 and is estimated at 13.7% in 2030 and 20% in 2050.
7. The New contributory pension scheme enunciated by the Government of India and adopted by
most of the State Governments is covered by the PRFDA bill. The bill inter alia, envisages a
social security scheme for all who desire to have an annuity at his old age which is voluntary
and not mandatory. However, in the case of Civil Servants, who are recruited to Government
service after the prescribed cut -off date ( 1.1.2004 in GOI service) the scheme is mandatory in
as much as the employee is bound to subscribe 10% of his emoluments to the Pension Fund
and the Govt. being the employer would contributes equal amount. No employee is entitled to
opt out of the scheme.
8. Despite the inability to bring in a valid enactment, the Central and all State Governments other
than those of West Bengal, Kerala and Tripura through illegal executive orders decided to
impose the contributory pension system arbitrarily on the Central and State Government
employees .While the Govt. of India notification excluded the personnel in the armed forces
and para-military establishments, the Governments of the Left ruled States of West Bengal,
Kerala and Tripura consciously continued with the existing defined benefit pension system.
9. The PRFDA Bill stipulates that there will not be any explicit or implicit assurance of the benefit except market based guarantee. The subscriber is thus exposed to the following risks at the exit.
a) If there is a major market shock, the subscriber to the New Pension scheme may end with no ability to purchase an annuity.
b) Since annuity is and cannot be cost indexed, the real worth of the annuity might fall depending upon the inflationary pressure on the economy.
c) As per the scheme, the subscriber is to make the choice of investment portfolio. The Civil Servant being mostly uninformed in finance and investment related matters, he might end up in making wrong choices which would eventually rob him of the old age pension.
d) The subscriber is perforce to contribute to the charges of the investment managers, whose priority often is as to how much profit they could make through investment of the huge corpus of pension fund in the volatile share market .
10. The pension fund created by the employees' subscription and the employers' contribution which directly flows from the exchequer ( which is nothing but tax revenue of the Govt.) is made available for the stock market operations which is not only unethical but also blatant diversion of public fund for private profit, both Foreign and Indian capitalists.
11. In the case of Civil Servants recruited after the cut-off date, the new scheme replaces the existing much better "defined benefit" pension scheme. In the process, the Government has created two classes of civil servants viz. the one with a defined benefit pension scheme and the other with the contributory pension scheme in which the employee is to part with 10% of his emoluments to become entitled for an old age social security subject to the vagaries of share market permits. Since in both the cases, the pay, allowances, perks, and other benefits, privileges, duties and responsibilities are the same it amounts to wanton discrimination of one against another which is not sustainable in law, rather violative of the existing constitutional provisions.
12. The wage structure presently designed for those who are recruited prior to the cut- off date and after is on the same premise and is depressed to enable the Govt. to meet the pension liability in future. By imposing the new contributory pension scheme on the employees who are recruited after the cut off date the Govt. not only denies the statutory defined pension benefit to them but also compel them to contribute for earning an undefined annuity, which must be characterized as highly discriminatory.
13. Those who are covered by the contributory pension scheme will become entitled for an annuity, a portion of the accumulated contribution is able to purchase, basing upon the accretion to the fund from the investment. There is, however, no guaranteed minimum amount of pension for those who are covered by the new scheme, whereas the civil servants covered by the existing scheme do get a defined and guaranteed minimum pension and on his death his family members (wife, widowed and unmarred daughters and unemployed sons below the age of 25) become entitled for family pension. The discrimination factor is thus compounded.
14. The PFRDA Bill when enacted, it is rightly feared, will empower the Government to alter or even deny the present employees and pensioners the statutory defined pension benefit as has been done in the case of those who are appointed after the cut-off date.
15. It is stated that the prime objective of the introduction of the contributory pension scheme is to substantially reduce the outflow on account of pension liability. The major pension liability of Government is accounted for by Armed Defence personnel. They are however excluded from the purview of the contributory pension scheme. The personnel in the Para Military forces are also excluded from the ambit of the new Scheme. While doing so, (no doubt to attract the people to serve in the armed forces for security of the Nation) the Govt. is bound to meet the pension liability from the consolidated fund of India. The argument advanced by the Govt. to cover the Civil Servants in the ambit of the new Pension scheme has been found to be unsustainable by the study commissioned by the 6th CPC. Shri S. Chidambaram, Actuary, in his report, (Annexure to "A study of Terminal benefit of Central Government employees by Dt. K. Gayatri, Centre for Economic Studies and policy, Institute for Social and Economic change, Nagarbhavi, Bangalore) has pointed out that the Government liability on account of contributory pension scheme would in effect increase for a period spanning for the next 34 years from the existing Rs. 14,284 Cr. To Rs. 57,088 Cr. ( 2004-2038) and is likely to taper off only from 2038 onwards. The exchequer is bound to have an increased outflow for the next 34 years and will be called upon to bear the actual pension liability of defence personnel and personnel of para military forces, besides making the contribution to the Pension fund of the Civil Servants recruited after the cut off date. The specious plea that the exchequer is bound to gain due to the contributory pension scheme is therefore not borne from facts.
16. Of the present pension liability of the Govt. of India, which in 2004-05 was 0.51% of the GDP, 0.26% is accounted for by the Defence( which is 50% of the total pension liability.) The study report of the Centre for Economic Studies has concluded that the pension liability as a percentage to GDP which is just 0.5% presently is likely to decline given the growth rate of Indian economy.
17. Since most of the State Governments have chosen to switch over to "contributory pension scheme" , in fairness ( from the Study conducted by the Centre for Economic Studies and policy) it can be concluded that the pension liability of all the State Governments are bound to increase to three times of what it is today by 2038.
18. The first version of the PFRDA Bill was placed before the Parliament by the NDA Government in 2003. The 6th CPC set up the Committee to go into the financial implication on account of the increasing number of pensioners and suggest alternative funding methodology in 2006. The said Committee came to the inescapable conclusion (report submitted in 2007) that "the existing systems of pension are increasingly becoming complicated after the introduction of the New Pension scheme" and warned that "caution has to be exercised in initiating any further reforms" In the light of the conclusion of the said study report which revealed the fact of serious escalation in the pension payment outflow, the rationale of the re-introduction of the PFRDA bill in 2011 covering the civil servants is incomprehensible. Undoubtedly, the Bill when enacted into law will through the existing pensioners to a financially insecure future and the existing workers to the vagaries of the stock market. We, therefore, earnestly pray to your good-self to bring back all the civil servants including teachers irresespective of the date of entry into Government service as also those irregularly appointed within the ambit of the existing statutory defined pension benefit scheme.
We may, in fine, quoting the concluding paragraph (Page 76 of the report of the Centre for Economic Studies and Policy – Institute for Social and Economic Change) of the Committee set up by the 6th CPC
"Mainly given the fact that the future liability although may be large in terms of absolute size is not likely to last very long and does not constitute an alarmingly big share of the GDP which is also on the decline. It appears that pursuing the existing 'Pay as you go' to meet the liability will be an ideal solution."
appeal you, for the detailed reasons adduced in the foregoing paragraphs, that the new pension scheme enshrined in the PFRDA Bill may be withdrawn from the Parliament both in the interest of the Civil Servants and the exchequer.
State : ………………….
Date : July, 2011