PENSION BILL

Govt Proposals Are Unacceptable: CITU

The secretariat of the CITU issued the following statement on November 22

THE UPA government in a bid to push for legislating the PFRDA bill in the ensuing winter session has put up a few proposals for amendments to be incorporated in it, in a note presented at a meeting of the Left-UPA coordination committee. The proposed amendments are only cosmetic changes, besides being a bid to confuse, and in no way address the basic concerns voiced y the employees and the trade unions.

The proposals now floated only seek to incorporate a few proposals in the main report of the parliamentary standing committee, which vetted the bill, and the issues raised in the dissenting notes appended thereto by the MPs from the Left parties have totally been ignored.

The dissent notes specifically pointed to Section 20(f) of the bill clearly ruling out ‘any implicit or explicit assurance of benefits except market-based guarantee mechanism and stated: “This means the fate of the employees in their old age will be determined by the vagaries of the market”. They had also termed the government’s move thus: “It is an attempt to dismantle the existing pension system for the government’s own employees and withdrawal of the responsibilities of supporting its own employees after their retirement. This is a retrograde step and in a welfare state (government) disowning this responsibility is unacceptable”. The proposed provisions for permitting one pension fund manger to be public or for option of 100 per cent investment in government securities do not in any way protect the employees from being the victims of the vagaries of market forces nor do they guarantee any minimum benefit of pension.

Similarly the inclusion of Tier-II account as part of the basic feature of the New Pension system is nothing new but a repetition of replacing the present mandatory General Provident Fund as a voluntary additional provision. This also does not address the basic objection of the trade unions to incorporating the individual Retirement Account concept as the first and mandatory tier. In this context, again the dissent notes clearly pointed out: “No other country, including the OECD countries, has made the individual retirement account based on defined contribution concept, the mandatory first tier of Social Security”.

The proposals to limit FDI and overseas investment are nothing but an effort to push through opening up of the pension sector to FDI, which the trade unions have opposed. Here again the dissent notes had pointed out: “….the neo-liberal regime practically wants opening up of the pension funds to the private operators (Fund Managers) including foreign fund managers. And this is a move, which is sought to be resisted the world over, even in the developed countries”.

In view of the foregoing, the UPA government will do well to adhere to the same advice tendered to it in the dissenting notes i.e., “to desist from pushing forward such anti-employee bill and discuss the matter with all concerned trade unions, and by taking their views evolve a comprehensive policy and framework to implement the same”. (INN)