AIBPARC TO CHAIRMAN, IBA. 17TH Aug.

[mohan p]

The Chairman, 

Indian Banks Association,

 Mumbai.

  Respected Sir, 

Sub : Pension Updation in the Banking Industry.  

We like to draw your kind attention to the undernoted facts : 

[Prasad C N]

Dear friends,

From State Bank of Mysore Pensioners' Commune, we are making sincere efforts to provide complete information and material with regard to various issues confronted by Bank Pensioners.  We are also trying to reach every member of our Commune and ensure flow of information through Mysore Bank Shathayu. 

Usually, Conferences are held at one place and those who are present get an opportunity to speak and hear.  But, majority cannot come, may be on account of their age or health or other compelling reasons.  To ensure providing opportunity to maximum  number of members and reaching out maximum number of members, we are organising meetings (General Body Meetings) at 13 places.  Final and ultimate meeting is on 28.10.2022.  It is too premature or early to announce the guest list.  But, we are confident that the guest list would be unmatched and best possible.  

We have gone one step further.  All our members, over 8,200 will receive hard copy of the General Secretary's Report.  Perhaps, every issue or aspect affecting Bank Pensioners has been discussed.  We have also made available full information regarding pension revision, regulation 35(1), pension funds, role of the Government.  We are also aware that atleast some of you may not agree with us.  But, we have indeed provided information backed by other material.

Please go through the attached Mysore Bank Shathayu.  You can also down load from our Website, http://www.mysorebankpensioners.in.  Go to Circulars page, then to Shathayu and then select 2022.  The first file is our Mysore Bank Shathayu.  

Glad to receive any suggestions and corrections.  

Thanks, a Million. 

With regards,

Prasad C N

General Secretary

State Bank of Mysore Pensioners' Commune.

[Prasad C N]

Dear friends,

The problem with Bank Retirees is that they are guided by the Pensioners' Associations.  Bank Retirees' understanding is dependent upon what the leaders say, as they trust their leaders.  Flow of information, whether it is correct or not is based on the knowledge and intent of the leaders.  Unfortunately, to show that they are seriously fighting for the cause, there are many occasions, where these leaders provide misguiding information.  Now, again AIBPARC has come out with another letter.  After going through, I have following questions.  I am aware that authors of this letter may not answer.  The purpose of this mail is served, if they can answer themselves.

a. It is stated in the para 1 of the letter that 'Thereafter, Regulation 35 (1) was amended in 2002/2003 in terms of powers conferred under section 19 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, and the amendment was duly gazetted. The amendment mandated that the basic pension and additional pension, wherever applicable shall be updated as per formulae given in the Appendix to Pension Regulations 1995'

1. What form of updation was taking place in Central Government during 2002/2003 for their pensioners ?

2. Whether the Central Government pension is updated by loading in 2002/2003, when this was amended ?

3. According to this amendment, what is the pension payable to a 7th Bipartite retiree whose Basic Pension is Rs.7,500/- ?

4. What is the meaning of 'as per formulae given in the Appendix to Pension Regulations 1995 ?

5. Can we travel beyond the formula given in Appendix I, if your argument is accepted ?

6. If so, what is the basis ?

7. What is the difference between 'Pension Updation' and 'Pension Revision' ?

8. Whether the Government of India speculated and imagined that the pension of its pensioners would be revised (not updated) as per          5th Pay Commission report ?

9. How Central Government Pension was updated, before acceptance of 5th Pay Commission report ?

10. Are you not restricting the improvement of pension by suggesting and requesting pension updation to mearly adding Dearness                  Allowance to Basic Pay upto certain points (say 4440 or 6352 points) and calculte Basic Pension, as provided in Regulation in 35(1)       (Appendix I)?

11.   Are you helping Bank Retirees or harming Bank Retirees ?

12.  Whether Supreme Court has decided that the law cannot be applied in parts and law is hard, but it is law ? 

13.   Are you not giving handle to IBA to deny Pension Revision, expecting IBA to be ignorant of all these provisions ?

b. It is stated in para 2 of your letter that 'The interest earned on this gain since 2002 is enough to service the cost of updation to the old pensioners while for the pensioners from 9th BPS onwards, pension updation has been made meaningless as unfortunately special allowance not being reckoned for pension. Therefore, the talk of additional cost is a fiction'. 

1. What was the Pension Updation formula adopted in the Country in 2002, by any organisation/agency/Government?

2. If pension were to be revised since 2002, what would have happened to Second Pension option and cost thereof ? 

3. Whether second pension option was better or pension updation was better ?

4. What was the cost of pension revision in Banks with loading in 2002 ?

5. How much of amount the Banks have saved by not revising the pension in 2002 and interest thereon ?

6. Is there any negotiation between employees and management which considers the interest saved on account of deferrment ?

7. Is it not true that 'Pension Revision' as a concept would have been introduced, if the Bank were to revise pension in even in 2005 ;

8. Please provide extract of any Pension Rules/Regulations in India, including CCS (Pension) Rules, 1972, wherein there is a clause            mandating revision of pension.

c. It is stated in para 3 of your letter that 'A funded scheme is one where the contribution to the fund is fixed and the return from the fund determine the pension payable periodically.  Whereas in Defined Benefit Pension Scheme, actual pension paid is charged to P/L Account in “pay as you go” method and contribution made as per annual actuarial valuation is charged to P/L Account in Corpus Method. BEPR (1995) requires 10% contribution every month and the shortfall, if any, as per annual actuarial valuation at the end of the year is made good by the bank'.

1. What is the Defined Benefit Plan means ?  Is it not true that the Payment needs to be made in terms of Pension Rules/Regulations or        any agreement between the employer and employee(s) represented by or otherwise Trade Union ?

2. What do you mean by method and contribution made as per annual actuarial valuation is charged to P/L Account in Corpus                    Method'.  What is Corpus Method ?  Where it is defined ?

3. How actuarial valuation is arrived at and what is the legal basis ?

4. If Bank has to make good the shortfall, if annual actuarial valuation finds shortfall, which account it has to be debited ?

5. Why no share holder has raised any objection to reduction of profits or increasing the loss, in any of the Annual General Meeting ?

6. What is 'P/L Account in Corpus Method' means ?

d. In para 4, it is stated that 'If payment of monthly pension is a statutory obligation, then pension updation is also an obligation in view of amended Regulation 35(1). Pension updation is, therefore, a charge to P/L Account and not an appropriation out of profits. Judged by this standard, the balance-sheets of the bank that are drawn till date are violating the basic accounting norms as they do not reflect Bank’s statutory obligations and hence do not disclose a true and fair view of the affairs'

1. Are they suggesting pension updation as per Regulation 35(1) ?

2. If so, is it not that adding Dearness Allowance upto 6352 is added to Basic Pay and then Pension is calculated is the formula, as                provided in Appendix I, as per Regulation 35(1) ?

3. Is profits, not out of P/L Account ?

4. If the Banks are violating the basic accounting norms, why no complaint has been lodged with SEBI, RBI and the Government ?

5. If providing out of Profit and Loss account towards meeting liabilities of payment of pension is not Bank's statutory obligation, then        why every Annual Report (even that of all other companies, as well) of Banks carry item on 'Accounting Standards, more particularly      AS 15 ? 

 6. We are not only Pensioners, but also Citizens of the Country and most of the pensioners are from Public Sector Banks.   If disclosure        is not true and fair view of the affairs, even shareholders and public in large are also affected adversly.  What action has been                    initiated by the organisation to stop illegality, if it is so ?

e. It is stated in para 5 that 'All the recruits till 2010 come under the purview of BEPR (1995). Even if the last batch recruited in 2010      were around the age of 24 years, they would reach the actuarial life expectancy age of 82 in 2068. In other words, if the funding cost of Rs.80000 crore is amortized over next 46 years from 2022, it amounts to only Rs.1740 crore per annum for all the banks taken together. This means that average annual cost is a meagre Rs.158 Crore per bank to meet the statutory obligation to pensioners'.  

1. What is amortization ?  Amortization of what amount ?  Amortization for what period ?

2. What is the difference between amortiztion and paying from Profit and Loss account ?

3. Is it called amortization, if the total amount is divided by number of years ?

4. Have we worked in a Financial Institution and still not aware what is amartization ?

5. Why Banks sought permission from Reserve Bank of India to amortize Family Pension revision obligation of Rs.20,300 Crores over      5 years?   Why most of the Banks have already provided entire addtional liability during last year itself ?

6. Why 'Special Allowance' is not reckoned for payment of pension, as the liability would have been lower than pension revision as per      the formula suggested in the letter ?

f. In para 6 of the letter it is stated that  'The statutory obligation of the bank to update pension has to be met with by banks by publication of updation formula for each wage revision. In case of doubt of what formula is to be adopted, the precedence is that of the formula followed for retirees between 01.01.1986 to 31.10.1987 because it is the formula of updation of pension for Central Govt. Employees of that period which was considerably improved in subsequent Pay Commission Recommendations. As the Bank Pension Scheme is available in RBI, the updation formula has to be at least as per RBI formula. Further in case of any doubt, Regulation 56 of BEPR (1995) requires reference to Central Govt Pension Rules.' 

1. Which clause of Pension Regulations, 1995 provides for or in terms which statute, the Banks are obligated to revise pension ?

2. Is it not contrary statement ?  At one place we say that the pension 'shall' be 'updated as per formulae given in the Appendix to            Pension Regulations 1995', but in other place it is stated that 'the Banks/IBA are obligated to publicise updation formula for each          wage revision' ?  According to them, what is the formula ?  Is it not what is stated in Appendix I ?

3. We are asking for application of RBI formula.  Have made any calculation as per RBI formula ?  Will there not be cases where  

    pension of those who retired earlier drawing pension more those who retired later ?  Is it possible ? 

4. Having referred to RBI formula, what is the relevance of Regulation 56 ?

5. Regulation 56 starts with 'In case of doubt'.  What is the doubt, the authors have ?

6. Regulation 56 also provides for referring to corresponding provisions in Central Civil Services (Pension) Rules, 1972.  Kindly  

    provide corresponding provisions in CCS Rules.

7. Is it not true that the Hon'ble Punjab & Haryana High Court in P C Jain & Ors Vs. Union of India & Ors. have analysed and decided 

    on the application of provisions of Regualtion 56 ?  Whether you opinion over rides legally settled matter ?

Dear friends, we can claim any benefit either on the basis of law or invoke sympathy or moral right.  If we have legal right, we should be enforcing in a Court of Law.  There is one Judgment which says that Pension Revision is not permitted in terms of Regulation 35(1).  Unfortunately, we have not found placing cogent reasons, why the Judgment is wrong.  Even th courts do not have authority to interpret based on conjecters.  These kind of letters do not help retirees, but harm the interest of retirees.  How it harms, I do not want to explain.  

Thanks, a Million. 

With regards,

Prasad C N

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[PM]

Dear Friends,


State Bank of Mysore Pensioners' Commune has proved beyond doubt,that they stand for the welfare of bank pensioners.Let it be in legal fight or organisational efforts,they could win through  consistent efforts,benefitting good number of pensioners.

Fortunately,they have a dedicated and committed leader -Shri.Prasad.C.N - with them.

Unfortunately we retirees do not have many leaders with such vast knowledge and commitment on subject in retirees apex organisation to 
lead us on right track to resolve our issues.
As a result we have seen leaders harping on same point which has dismissed by high court.

Number of times we have discussed here on Regulation 35(1) which has not meant for updation of pension as and when wage revision takes place.
We are sure that  the leaders of AIBPARC may not have answers for questions raised by Shri.Prasad.

[Vvns Varaprasadrao]

Unfortunately we retirees do not have many leaders with such vast knowledge and commitment on subject in retirees apex organisation to 
lead us on right track to resolve our issues.

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[Sankaranarayana Sarma]

I am in USA right now. Will be back on 13 Nov 2022. For the Associate Membership I want to contribute Rs 500/-. If G Pay is available, please provide number

B SANKARANARAYANA  SARMA

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[krishna murthy]

Dear sirs Mine Retd under svrs 2000 from Indian Bank as chief manager My wife also took vrs in 1997 as officer from Indian Bank My eldest daughter is a divorcee for 22 years She is now employed She has health problems she wants to leave her job Can i nominate my eldest as nominee for family prnsiom v Krishna Murthy 

On Thu, 18 Aug 2022, 6:31 pm PM, <moha...@gmail.com> wrote:

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[mohan p]

Dear Shri.Krishna murthy,

Bank Employees Pension Regulations,1995 stipulate on payment of Family Pension on specific manner as furnished here under:

"Regu.40. Period of Payment of family pension.

(1) The period for which family pension is payable shall be, -

(a)in the case of a widow or a widower, upto the date of death or remarriage, whichever is earlier;

(b)in the case of a son or daughter (including widowed/divorced) till he/she attains the age of twenty-

five years or upto the date of his/her marriage/remarriage, whichever is earlier:

Provided the family pension payable to sons/daughters (including widowed/divorced) shall be 

discontinued/not admissible when the eligible son/daughter starts earning a sum in excess of Rs.

2550/- per month from employment in Government/private sector/self-employment, etc.

Provided further that if the son or daughter of an employee is suffering from any disorder or 

disability of mind or is physically crippled or disabled so as to render him or her unable to earn a 

living even after attaining the age of twenty-five years, the family pension shall be payable to 

such son or daughter for life subject to the following conditions, namely,

(i) If such son or daughter is one among two or more living children of the employee, the 

family pension shall be initially payable to the minor children in the order set out in 

clause (e) of sub-regulation (1) until the last minor child attains the age of twenty-five 

years and thereafter the family pension shall be resumed in favour of the son or daughter 

suffering from disorder or disability of mind or who is physically crippled or disabled and 

shall be payable to him or her for life;"

Regards,

Mohan.P

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