Some other thoughts occurred to me.
Legally it will be difficult for the Government/LIC to implement the DR freeze for the pensioners on the lines done for Central Government pensioners.
Firstly,Central Government pensioners have been getting upgraded pension after acceptance of every CPC recommendations from 1/1/1996 and they have been not only receiving higher basic pension but also cascading increase in DR after every CPC.So there is a shield for the pensioners for their upgraded pension and the pre-freeze DR.
Besides,the family pension paid for Central Government family pensioners is 30% of last drawn pension with regular upgradation with every CPC recommendations.
In case of LIC pensioners,they have been missing upgradation of pension for wage revision periods ranging from 7 years to 20 years.To the extent,that more than Rs 5000 Crores of arrears at least have been denied to all the eligible pensioners due to non-upgradation of pension,this amount has remained with LIC during those periods and 5% of the valuation surpluses generated in all these years have been enjoyed by the Government of India as dividend on the meagre share capital infused in LIC by the GOI.No doubt the 95 % of the surplus arising out of denial of upgradation of pension have been passed on as bonus to the policyholders.Any benefit of DR freeze effected for LIC pensioners has no way of flowing to the Government except through the 5% valuation surplus route which may be minuscule.
Family pensioners any way have been languishing at a low rate with erosion of the rupee value thanks to consistently galloping inflation.
If DR freeze is imposed,it will also be done alongside for PS Bank pensioners and there is bound to be a challenge to the same for a stay in the courts of law.We can expect that intensive legal consultations may precede any decision the the GOI may take in this regard.
Let us wait to see what happens on this front.
C H Mahadevan
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