This is not a new phenomenon.
Such a reduction takes place after every wage revision for those who
retired after the effective date of wage revision.
Once a retiree opts to receive the
difference in CV of 1/3 rd pension, naturally The logic is that the
retiree can get a reasonable return if he invests the CV difference in a safe
investment. So the reduction in the monthly net pension will be offset by the
investment yield. Many of us overlook the fact that if a retiree dies
before completing age 65,our pension rules provide for payment of family
pension at twice the rate of family pension indicated in the Appendix on rate
of FP or half of the regular pension(whichever is less) till such time as
the retiree would have completed 65 years if he had survived. This is in
addition to the difference in CV due to the retiree on the date of retirement.
There will be no monthly recoveries towards commuted pension after
the death of the retiree. These are all issues based on the
actuarial principles adopted while deciding on CV payable to retirees based on
life contingencies. There can be no legal remedy for this. But the in- service
Associations/Federations -if they wish-can bargain with the LIC
Management for payment of interest on CV difference, because the CV
factors are actuarially constructed by factoring a compound rate of interest.
When arrears are paid CV difference due on the date of retirement is being
paid with a delay of over 3 years there is justification for payment of interest.
In service Federations may not be interested in bargaining for this and
retirees' Federations are ignored during wage revision negotiations.
Incidentally,I understand that DA
merger for wage revisions from 1/11/2002 was done at 4440 points
whereby the number of slabs merged were less by 67 than the slabs as on
1/11/2012.In effect the merger of DA was only as at 1/11/2011.If they
adopt Bank pattern for LIC wage revision, they may only merge the DA as at
1/8/2011 and factor a negotiated fitment weightage(increase of say 15% on wage
bill component).
For your query, my reply is that
retirees from your category should opt for not receiving commuted pension
difference if they do not want reduction in net monthly pension.
Otherwise, they should be prepared to receive whatever LIC gives and enjoy
available benefits.
The caveat here is that all the
above issues will only arise after the wage revision is finalized by
LIC/GOI.
Kind regards.
C H Mahadevan
On Thu, Jul 23, 2015 at 10:40 AM,
madan mohan rao karanam <kmmrao1954@gmail.com>
wrote:
Respected Sir,
Namaste. I am very much thank full
for up dating the latest information about pensioners in spite of your busy
schedule in U.S.A.. Sir it seems that G.O.I is insisting LIC Management to
submit wage revision proposals due from 01/08/2012 as per bank pattern, of
course all unions which formed joint front are opposing , but we do not know
how far they will succeed. If the bank pattern is accepted we the pensioners
retired after 01/08/2012 will get reduced pension between Rs 2500/- to Rs
5000/- per month .Unfortunately UFBU accepted I.B.A proposals and UFBU leaders
are compensating decreased pension with increased Commutation . How far it is
justified sir and is there any way to oppose and approach court of law for
justification.
K.Madan Mohan Rao
