DIFFERENT VIEW

Referring to the posting  'Different view' by  Mr V V L N Sastry, I
would like to respond on 100% DR Neutralisation  being granted by LIC
from 1/8/1997.

The real issue is  not when it was granted or why it was not granted,
but whether  the 100% DR Neutralisation  is equally applicable  for
both the in-service employees  and the retirees  under the same
formula.LIC made  the DR formula same  for in-service employees and
retirees from 1/8/1997,but  under  the LIC Pension Rules 1995,the DR
formula for pre-August 1997 retirees  was not the same as that  for
pre-August 1997 in-service employees with the result that the
pre-August 1997 pensioners  were made entitled to a DR  at about 50%
of what would have been available  if it had been worked out on the
basis of the formula adopted for the in-service employees. That was
the root cause of the pension anomaly that cropped up after
notification of the LIC Pension Rules 1995.

We need to understand that  the so called 100% DA Neutralisation for
even in-service employees was granted only from 1/8/1997.But the
problem  of anomaly for pre-August 1997 retirees arose not because of
absence of 100% DR Neutralisation, but because of inequitable DR
neutralization  between in- service employees and retirees during the
period from 1/11/1993 to 31/7/1997.LIC ,instead of addressing this
anomaly,went about in its own wrong  interpretation of the LIC Board
Resolution and  calculation of erroneous DR as at 1/8/1997 and
merging the same with the existing basic pension  to revise the
pension  from 1/8/1997.To add insult to injury,this erroneous and
inadequate pension was kept static without similar merger exercise on
1/8/2002 and 1/8/2007.If only the DR anomaly  had been removed by
amending the  pension slabs for DR calculation upto 31/7/1997,even
without  upgradation, all the pre-August 1997  retirees  would have
been getting  more  gross pension than what LIC  calculated as payable
as per the LIC Board Resolution.We have to accept  that the
pre-August 1997 retirees have been  miserably discriminated against
through a wrong DR formula which is not the case with retirees after
1/8/1997,even keeping  aside the issue of upgradation separate for the
moment.

Greetings.

C H Mahadevan