AIBPARC TO CONVENOR UFBU ON MOU

[mohan p]

AIBPARC/UFBU/Pension updation/email/2023

 

Date: 19th December, 2023.

 

Shri Sanjeev K. Bandlish,

 Convenor

 UFBU,

Chandigarh.

 

Dear Comrade,

 

Sub: MOU signed between IBA and UFBU on 7th December, 2023 on wage revision.

 

We Congratulate profusely You and All the Leaders of All the constituents of UFBU through you for arriving at a successful Wage Revision Settlement within a period of one year (approx.) from the date it fell due. It is indeed a path breaking trend when compared with all the previous Wage Negotiations, thanks to the great initiatives taken by All the parties concerned, the Ministry, IBA and UFBU.

At the same time, we cannot conceal our disappointment over the contents and spirit of the paragraph no 5 of the aforesaid MOU which deals with matters relating to Pensioners of the Banking Industry.

Our grounds of disappointment are mentioned hereunder with a request to take immediate steps to ensure Justice to Your Elders:

(A) The concept of 'ex-gratia" is applicable for Retirees prior to 01.01.1986. By no stretch of imagination, it can be made applicable to Pensioners whose Pension is governed by Bank Employees Pension Regulations.

(B) Pension Regulations are the result of the Pension Settlement between the IBA and the Employees Unions and Officers Organisations which was duly passed by the Boards of Member Banks of IBA, approved by the Government as Subordinate Legislation and Gazetted as Statutory Provisions and known as BEPR (1995).

(C) Pension is given as Second Benefit only though originally demanded as Third Benefit as available to SBI Pensioners. The Negotiating Unions agreed to accept Pension as Second Benefit when IBA obviously with the concurrence of the Government made it on the lines of Government and RBI Pension Scheme. When Com. R N Godbole, the then General Secretary of AIBOC wrote to IBA in 1993 and 1994, to make some improvements in Bank Pension Scheme, IBA replied stating that no improvements could be considered as the Pension Scheme in Banks are on the lines of Government Pension Scheme and also cited favourable features of Government Scheme including Updation.

(D) Bank Pension Scheme is a Defined Benefit Pension Scheme.

(E) Pension Regulations 5 to 11 speak about the Constitution of the Pension Fund by the Surrender of the Management Contribution of PF by the Pension Optees and those already Retired with interest there on and in case) It is Very Very important to mention here that in the year 2003 Pension Regulation 35 (1) was amended and duly gazetted making it universally applicable to all Pensioners Quote Basic Pension and additional Pension wherever applicable shall be updated as per the formulae in Appendix 1 Unquote, as against Regulation 35 (1) in 1995 which mentioned "who retired between 1st January 1986 and 31st October 1987 will be updated as per formula in Appendix 1". We request you to please note the material, qualitative and very significant change between the 35 (1) of 1995 and Regulation 35 (1) of 2003 which inter alia states SHALL BE in place of "will be " and FORMULAE (Formulas) in place of Formula and also very importantly removing the time lag those retired between 1st January 1986 to 31st October 1987 which makes it crystal clear the intent and purpose of the amendment effected to Pension Regulation in 2003.

F) Pension is a Deferred Wage as held by the Hon'ble Supreme Court and Periodical Wage Revision and Periodical Pension Revision are inseparable.

(G) It is Very Very important to mention here that in the year 2003 Pension Regulation 35 (1) was amended and duly gazetted making it universally applicable to all Pensioners Quote Basic Pension and additional Pension wherever applicable shall be updated as per the formulae in Appendix 1 Unquote, as against Regulation 35 (1) in 1995 which mentioned "who retired between 1st January 1986 and 31st October 1987 will be updated as per formula in Appendix 1". We request you to please note the material, qualitative and very significant change between the 35 (1) of 1995 and Regulation 35 (1) of 2003 which inter alia states SHALL BE in place of "will be " and FORMULAE (Formulas) in place of Formula and also very importantly removing the time lag those retired between 1st January 1986 to 31st October 1987 which makes it crystal clear the intent and purpose of the amendment effected to Pension Regulation in 2003.

(H) We have time and again written to you over the years that there is an expressed provision in BEPR (1995) which clearly tells about the Updation of Pension and the process of calculation to arrive at such Updation. This is the oft-- quoted Regulation 35 (1) Appendix 1 of BEPR (1995) as amended in the year 2003. The updation has been made universally applicable for all eligible Retirees as per the Formulae (Formulas) to be notified from time to time along with Periodical Wage Revision. What was or is required to be done is to implement the Updation of Pension by notifying the Formulas as per RBI Formulas in respect of each Bipartite Settlement including the present Bipartite Settlement. of any shortfall after the Actuarial Estimation at the end of every Financial Year, the same should be provided by the Banks to secure payment of Pension as per the provisions of Pension Regulations.

(I) From different record of proceedings, we find that IBA was always talking about the astronomically high cost of Updation to deny the legal entitlement of the Bank Pensioners. The Hon'ble Supreme Court has categorically held in the famous and historic Nakara Case that Cost should not be a constraint and Payment Pension as per Pension Regulations is Statutory and legally binding obligation of the Employers to their Past Employees. We do not know whether IBA made available to you the workings of such calculations of the Cost. If it is so, we request you to make the same available to us, the Apex level Retirees Organisations so that we can have an opportunity to see the assumptions on the basis of which the MOU on Pension Updation is not only sidelined now but also for nearly Three Decades. We have submitted our calculations to GOI/IBA/ UFBU. We feel that if Updation of Pension is implemented as per RBI formulae, the cost is a manageable one and the existing Robust Pension Corpus which is further likely to swell nearly to Four Lakh Crores in March 2024 including SBI to take care of the same without any adverse impact on the Balance Sheets of the Banks.

(J) The present offer of the Strange Ex-gratia" by IBA in lieu of our just, fair and legally entitled Updation of Pension is nothing but a dilatory tactics practiced by IBA for the past more than ten years since we raised the demand of Updation of Pension, sometimes citing Cost Implications and sometimes stating no Regulation to Update, totally shutting their eyes to the Express Provision made in Pension Regulation 35 (1). They have been unfortunately misleading the Hon'ble Minister of State for Finance while replying the questions of Hon'ble Members of both the Houses of Parliament on Pension Updation by ill advising the Hon'ble Minister repeatedly stating that there is no provision for Updation of Pension in the Pension Regulations hiding Regulation 35 (1). This way, IBA is knowingly or unknowingly committing a great offense to the Parliament and the Nation. We are confident that UFBU will make IBA to make the required Course Correction. When 55 out of 56 Pension Regulations are implemented specially with impunity the Regulations that are adversely affecting the Pensioners and Retirees like Disciplinary Proceedings under Pension Regulations, Revision of Quarterly DA while in Service to Half Yearly DA after Retirement, all in the name of Central Government Pension Rules as provided in Bank Employees Pension Regulations Why Regulation 35 (1) as amended in 2003 is not at all implemented so far? When the question of implementation of Regulation 35 (1) is concerned, it is strange that the IBA is turning a blind eye. It is high time UFBU calls for a Halt to this My Way is the High Way Policy of IBA and resist the Anti Pensioners stand and attitude of IBA.

Lest, left to their wishes, IBA will reduce the hard-won Pension Settlement into Ex-gratias. No wonder, tomorrow they will apply Ex-gratias into Wage Settlements also inflicting serious blow to the Bipartite Machinery. We fervently hope you will successfully resist all such moves and attempts.

You will definitely appreciate our stand about the MOU and at this Stage and Age of our life, we do not expect mercy against our Rightful Legal Entitlements.

We request you to once again demand before IBA that Pension Updation should be done in Banks as per expressed provision of the statute.

This is not unlikely that the contents of our letter might cause irritation in your minds asking loudly or silently as to what authority we do have to question the lines of action decided by the collective wisdom of UFBU. We can only say that as your Elder Colleagues in the industry, as the diehard, and loyal soldiers of Unions and Associations while in Service and also as one of the Principal Stake Holders for the community of Retirees, we have the right and liberty to request You to put forth the demand of Updation of Pension which is established by the Provisions of the Regulations and not to allow any dilution or

distortion and implement the Regulation in letter and is hazy and inconsistent with the Statutory Provisions Inas much as W offer Ex-pra by the ink Employe Pension Regions and scale discussions about the final shape of the Settlement are yet to take place between You and IBA, we have abundant hope and faith that you will ensure implementation of Regulation 35.1 and Updation as per the formulae applied to RBI Pensioners. Banks are making Huge and Record-Breaking Profits and so the Cost of Updation should not be a worry specially after making more than Ten Lakh Crores of Write offs in the name of Cleaning the Balance Sheets of the Banks.

We are Hopeful and Confident of getting Justice ensuring Our Dignity.

 With best wishes  and comradely greetings,

Comradely yours,

K V Acharya

President,AIBPARC

& Joint Convenor of CBPRO

Suprita Sarkar 

General Secretary 

[Satyanarayana Rao]

What is the legal experts opinion to this e mail sent to UFBU convenor by AIBPARC one of the largest organisations of bank pensioners and retirees confederation?

What is the understanding and how 35 1 of pension regulations metamorphosis on the year 1995 and 2003 and the total impact and it's suppression and deleberate misinterpretation by the custodians of bank pension regulations?

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[Ramani Konnayar]

Again and again, AIBPARC is harping on their stand that Regulation 35(1) as amended in 2003 stipulates updation for all pensioners, though IBA, Govt, UFBU categorically say it is not so. And more than anything else, some High Courts too have pronounced in their judgements that BEPR provides for updation in some specific cases alone. 

So, as rightly pointed out by yourself in one of your recent letters, notwithstanding the nonavailability of provision for updation for all in BEPR 1995, Government can still sanction it, if it so wishes. 

Incidentally, it is my humble opinion that lengthy communications could make the recipient lose interest in going the contents, especially when the matter has been dealt with in great detail in earlier communications. 

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[JSOMA SHEKARA]

Due to positive and firm actions of DFS  almost all pending issues of Bank pensioners except updation are resolved . Updation also though not as per our expectations likely to be resolved soon.

After this except pension on special allowance no major issues will be pending.

UFBU and retiree associations have no control over NPS.

Shortly both AIBRF and AIBPARC will become irrelevant for retirees.

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[Satyanarayana Rao]

One more very important issue is that is to be achieved is affordable health insurance for all retirees and the entire premium is to be paid by the banks ad being paid for serving employees. 

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[NSS]

Friends

Sec.35(1) as it stood originally is reproduced below.

35. Amount of Pension.
(1) In respect of employee who retired between the 1st of January 1986 but before the 31st day of October 1987, basic pension and additional pension will be updated as per the formula given in Appendix-I.

In the Appendix -I the following also is found.

2. The formula for updating basic pension in respect of workmen who have retired on or after the 1st day of November, 1992 but before the 1st day of September. 1993 and in respect of officers who have retired on or after the 1st of July, 1993 but before the 1st day of May, 1994 shall be as under:

After amendment Reg 35(1) reads as under.

Basic Pension and Additional Pension wherever applicable shall be updated as per the formulae given in Appendix I

Plain reading of the above shows that these formulae apply only to those who retired during certain periods and not to all. The dates 1st January 1986 , 31st October 1987, 1st day of November 1992  etc. are notable. The period between the two dates is 10 months. We have to confirm whether these 10 months are spread over two Bipartite Settlements. The first set of dates 01/01/1986 to 31/10/87 appear not to be spread over two settlements in view of the fact that the subsequent settlement was effective from 01/11/1987. 

Whatever may be the objective behind this exercise called updating, it is not the updation we are demanding at present,

Minutes of the Small Committee and the Draft Pension Regulations signed by both sides are the documentary proof that Pension Updation as per RBI formula was agreed to by IBA.

Regards

N.Sankara Subramanian 

[Ramani Konnayar]

Sir, 

My observations are as follows. 

Pension Scheme was made operative from 1/11/93 but was made applicable to those who had retired on or after 1/1/1986.

Those who retired between 1/1/86 and 31/10/1987 were under 4th BPS where the Basic Pay structure was very low. 

So, may be, as a goodwill gesture, their DA was merged with the Basic Pay to arrive at the Basic Pension but no loading was given as done in 5th BPS. 

In respect of the second set (1992-93/1993-94) during the given period, some retirees' last 10months' service would have been covered under 2 consecutive bipartites. 

Since, such a situation is possible whenever a new BPS is signed, the Reg 35(1)might have been amended as mentioned. 

Adverting to what is stated in the last para, please clarify if RBI formula of pension updation was already available in their Regulations when BEPR 1995 regulations were drafted. 

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[Prasad C N]

Dear Sir,

There were three categories of pensioners of that period.

a. DA for Officers, Clerical Staff and Sub-Staff were different, unlike present formula

b. There were pensioners belonging two Bipartite Settlement period

c. There were pensioners who fall in different Bipartite period, but 'Pay' was not revised.

To avoid anomaly, they havejust added DA to Basic Pay and pension was paid.  It is the same formula of merging DA at 8088 points and DR to be paid at common rate.

Thanks, a Million. 

With regards,

Prasad C N

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[JSOMA SHEKARA]

Reg 35/1 is useless and a waste of time. While negotiating updation issue neither IBA nor UFBU will  bother about these regulations. Their only contention is cost.

1. IBA outright rejected Pension for resignees in the past stating that as per Pension regulations those who resigned are not eligible for Pension

2.  Even for 100% DA IBA said cost is not affordable, sub judice and benefit can be considered on compassionate grounds. Even UFBU agreed to this.

But now these two benefits have become reality because Hon.FM stepped in to resolve issues and both IBA/UFBU signed minutes. Likewise, if FM wishes Updation also will happen.

Till then we only get Ex Gratia which may be finalized on the day of signing the final 12th BPS settlement.

It may be their strategy not to disclose details till Settlement is signed.

However petitioners in Singla case are basing their case on Small committee meeting resolutions, Agreement dated 29.10.93. Let us hope they succeed in this.

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[Gopalakrishnan Ramachandran]

Merging DA will solve many problems. The different categories of pensioners' will be brought under a single formula. Then you can update the pension to have a reasonably  good increase. Or for the time being, ex-gratia according to the revised basic pension. This will remove anomalies and provide a justifiable solution. Hope IBA and UFBU will work on these lines, with the low paid pensioners getting a reasonable ex-gratia.

G Ramachandran

CB-SVRS 

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[NSS]

Sir

There is no provision for Updation in RBI Regulations.

Regards

N.Sankara Subramanian

[Ramani Konnayar]

Thanks for your mail. In as much as there was originally no clause for updation (for all)in RBI till it was introduced in 2019 subsequent to GOI permitting it as per a SC judgement

(striking down the withdrawal by GOI of the updation given by the Board of RBI  sometime during 2001/02 sans GOI approval)how could have the small committee recommended (in 1995) updation as per RBI formula? 

So, what was the formula, if any, discussed by that committee is not known. 

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[Rajamani Srinivasan]

Dear Mr Prasad ji,

For a short while,

let us keep aside all the things like updation, DA merger, another option etc.,

Now they have made a statement that 17% increase in pay slip will be there for working employees. Fine and good.  The cost of this has been worked out and preliminary agreement has been signed.

Like wise for retirees some increase- let it be Rs.1 or 1% or 5%- would have been arrived at and the cost would have been calculated.  If it is not so, how the MOF will accord sanction for the specified quantum of  ex gratia? Will MOF accord sanction without quantum being specified.?  When they can announce 17% increase for working class, what prohibits them in informing the quantum of ex-gratia recommended or decided, more particularly when both are subject to approval by MOF?  Why the leaders should keep the Retirees in dark and in suspense mode.  Or is it just to cover themselves that in case the MOF does not approve or approves lowest % say 1%, these people will have an opportunity to say we recommended minimum 15% but MOF did not sanction this due to funds position. If % age increase cannot be disclosed then how did they announce for working employees - especially when MOF is yet to approve the recommendation of the leaders and IBA?

What benefit these leaders are going to derive by keeping the information so secret?

Kindly enlighten me.  

If it is to be discussed and decided in Jan 24, they should have simply said that we are trying for ex-gratia only now, and the details like quantum, effective date etc will be announced later after a decision is made.

It would have been a fair and transparent approach.  Many retirees are upset on this count.

I just want to have your views on my observations.

S Rajamani

Bangalore.

25122023

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[Niranjan Cn]

Sir,

To be upset is everyone’s right.  One should be cautious about need of it.  Being pensioner we shall have patience and wait for a month so that clarity will emerge.

Even for working class basic scales are not announced yet.  Pension involves more nitty-gritty as all pensioners are not on equal footing.  Let them work out get us the best one possible.

Any way Singlas case will bring benefit as per AIBPARC as it is a legal right.  Wish them all the best for success in court irrespective of legal grounds.

Niranjan 

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[Sankara Subramanian]

Sir

No formula was discussed. From the begitinning the understanding between the parties was that our Regulations should be similar to RBI Regulations in all respects.

Regards

N.Sankara Subramanian 

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[JSOMA SHEKARA]

PROS and CONS OF EX GRATIA

PROS

1.  For the past 3-4 BPS settlements, the Updation issue is  relegated to residual issues but never discussed seriously. At least in this settlement some understanding is reached and some increase is guaranteed.

2. As per reports EX gratia is substantial

3. Though not confirmed, as Ex Gratia is included in MOU  it will effective from 01.11.2022 and arrears  will be paid

CONS

Though some pensioners are reporting that this is interim relief quoting Union leaders there are very few chances of Updation  as there are chances of regime change or change of present FM who is  instrumental in getting  some issues of pensioners resolved.

IBA/UFBU are unlikely to discuss Updation and resolve it once settlement is signed.

Pre 2002 pensioners basic likely remain as it is till life time.

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[Ramani Konnayar]

Thanks. So, the correct version of the story till now, in brief, is as follows. This is for the benefit of those pensioners who may not be knowing the chronology of events, in detail. 

Originally, RBI Pension Regulations didn't contain any provision for periodical updation of pension in tune with the regular revision of employees' wages. 

Perhaps, it might have had a clause similar to 35(1) of BEPR 1995.*

However, in the early 2000s, the RBI Board, on its own, updated the pensions of all its retirees, taking the stand that it had the power to do so in terms of this* clause. This was objected to by GOI which instructed RBI to withdraw the updation circular and RBI had to abide by the orders. GOI reportedly wanted to avoid similar demands for updation in PSBs. 

Soon, a case was filed in Mumbai High

Court challenging the authority of GOI to instruct the RBI Board as above and the judgement was in favour of the petitioners. GOI went in appeal to Supreme Court which upheld the judgement of Bombay HC in 2018/19. This legal battle had gone on for more than 15 years or so. Ultimately, the GOI budged and the first ever updation of pension for RBI retirees took place wef April 2019 i.e.,  more than 25 years after introduction of the pension scheme. This was given effect to upto the 10th BPS. 

Although, the 11th BPS was signed in April2020 and was effective from 1/11/2017, the corresponding updation of pension in RBI was done after more than 3 years in July 2023 WITH NO ARREARS and only wef June 2023.

Perhaps pinning their hopes on what happened in RBI, Canara Bank Retired Officers' Association (affiliated to AIBPARC) filed a suit in Karnataka High Court seeking directions to Canara Bank to effect updation of pension on the basis of Regulation 35(1). However, the court dismissed the case saying 35(1) was only applicable to certain specific cases. Moreover, it only involved merger of a certain part of DR with Basic Pension. But, still, AIBPARC is clinging on to 35(1) and says this regulation has cast a statutory responsibility on banks to sanction UPDATION TO ALL PENSIONERS in consonance with every wage settlement for employees. 

It remains to be seen whether SC is going to uphold this contention in the ongoing  Singla case by quashing the judgement of a Division Bench of a High Court. No doubt, the GOI/IBA might go in appeal if the judgement is in favour of the pensioners. 

In the meantime, we are keeping our fingers crossed about the quantum of ex-gratia that has been agreed to be give, hopefully as an interim arrangement pending final decision in the matter of updation. 

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