RBI Employees Are Paying Price of Government's Inefficiency in Fixing Pensions, Say Former Workers

After years of tussle with the central government, the employees and officers of the Reserve Bank of India have called for a mass casual leave on September 4 and September 5. The appeal for the mass protest by the United Front of Reserve Bank Officers and Employees (UFRBOE) comes after the Ministry of Finance refused to give a nod to the updating of the pension options to the employees of the central bank. The protest is likely to paralyse the banking services like clearing and payment system, along with cheque clearances, payments and settlements and forex transactions, real time gross settlement (RTGS) and national electronic funds transfer (NEFT) systems. 

The UFRBOE, in a release, stated that the Centre's rigidity and reluctance has forced them to go on a mass leave. It said, “Demanding the updating of pension, one more option to contributory provident fund (CPF) retainers to switch over to pension and grant of CPF and additional provident fund to recruits from 2012 onwards, the collective body of Reserve Bank officers and employees has called upon the entire RBI workforce to avail two days of mass casual leave.”

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The RBI employees, unlike employees of many central public sector enterprises, have been deprived of benefits of pension revisions. The pensions for the employees of the Reserve Bank of India were introduced from January 1, 1986, in lieu of the contributory provident fund (CPF). In order to keep the pensions universal, the Centre assured the employees that it will be on similar lines with Central Government Pension Scheme. Similarly, the pensions will be revised after pay revisions recommended by the pay commissions. The retired employees of the Reserve Bank were given pension equivalent to the central government employees till 2002, when the Ministry of Finance stopped the improvement amid intermittent pay revisions. 

The central government offered the option of switching over from Contributory Provident Fund to pensions. However, 2600 employees could not change to pension within four years, till 2000, and were left in lurch, as the Centre put a stop on further revisions. While the markets have failed in generating good returns over the years, the retirement amount of CPF does not also bring any significant relief to them. 

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Commenting on the mass protest, M L Malkotia, a retired employee of the RBI, said that the failure to update the pensions is grossly unjustified. He said, "The issue of updating pensions have been languishing for a long time. The issue came up before a parliamentary committee which clearly stated that the Reserve Bank can give pensions to the employees. Despite this, we have not been given our due. It is beyond comprehension that the bank, which has enough funds, is not being allowed to update the pensions." He was referring to the corpus fund of Rs 16,000 crore of the central bank, borne out of its contribution on account of employees’ provident fund.

When asked about the impact of stagnant pensions on their lives, Malkotia said that the pensions are not enough for survival, and people have to be dependent on other sources of income to sustain. He said, "Miyan Biwi ka kharcha chalana mushkil ho gaya hai aap parivaar ki baat chhodiye [The pension is not enough for even the husband and wife, let alone the family.] Real pension is going low with inflation touching new heights."

He added, "The banks are offering an increase of 2 per cent in the salaries of their employees, while the defaulters have fled with taxpayers’ money. So, this in itself reflects the changing characters of the banks."