ALL INDIA PENSIONERS’ FORUM FOR RETIRED OFFICERS OF CENTRAL EXCISE,
CUSTOMS & SERVICE TAX DEPARTMENT
A DIVISION OF
INDIAN REVENUE SERVICE (CUSTOMS & CENTRAL EXCISE) PROMOTEE
OFFICERS ASSOCIATION
C.R. BUILDING , BHUBANESWAR-751007
No.P-1/VII-CPC/2014
Dated: 24 11.2014
To
The Chairman,
VII CPC,
New Delhi.
Sir,
Sub: Memorandum to the 7th Central Pay Commission on issues of Pensioners’.
On behalf of the All Indian Pensioners’ Forum for
retired officers of Central Excise, Customs and Service Tax Department a
division of IRS(C&CE) Promotee
Officers Association, we submit the memorandum for the consideration of the Commission.
As indicated in detail in the
memorandum, we have made certain submissions to elucidate
the views and contentions in respect
of the appropriate pension of
retired officers. We request that the 7th Central Pay Commission may consider
our submissions and make appropriate recommendations to the Government.
Particulars of
the Association.
(i). Name: All Indian Pensioners’ Forum for retired officers of Central Excise,
Customs and Service Tax Department a division of Indian
Revenue Service ( Customs & Central Excise) Promotee Officers Association.
(ii). Headquarters:
Bhubaneswar.
(iii). Address
for communication: C.R. Building , Bhubaneswar-751007.
(v). Mobile No. 0 9437314941.
(vi). Membership: The Association
presently represents more than 8000 members., who are retired officers and Gr-A promotee officers (Executive Officers)
under Central Board of Excise and Customs , the Department of Revenue of
Ministry of Finance.
MEMORANDUM
Though the Central Board of Excise and Customs (CBEC) deals with
task of policy formulation and administration of indirect taxes through levy
and collection of Customs and Central Excise duties, Service Tax and other
miscellaneous indirect taxes and matters relating to Narcotics, however recent
shift in commodities being smuggled from traditional items like gold, silver,
watches etc. to arms, ammunition, explosive, fake Indian currency, Narcotics
etc. CBEC focused attention on prevention of smuggling of these contraband
goods which are posing a serious threat to national security. The major
responsibility in the area of Central Excise is the prevention of leakages in
revenues and providing smooth and efficient flow of collections. By revenue
points of view, the CBEC is the highest revenue earning source for the Union
Govt., which has no parallels. The IRS (promote) officers are being posted in
different field offices of CBEC and also posted in CBEC ( Hdqrs) on central
deputation scheme as Central Secretariate Gr-A officers.
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(7)
PENSION
(i)
ONE RANK ONE PENSION:
The
Central Excise and Customs Department has the same structural features, command
& control elements as in Defence forces. The Central Excise and Customs
executive officers also serve under similar harsh service conditions as the
Army. In spite of the similarities in the duties performed by the Central
Excise and Customs personnel and Defence personnel, the former
ones are deprived of privileges extended to Defence and Police
services. The command, control and also rank structure of Central
Excise and Customs are similar to the Army except that the ranks in
Central Excise and Customs have different nomenclature (Chairman, Member,
Principal Chief Commissioner, Chief Commissioner, Commissioner, Additional
Commissioner, Joint Commissioner, Deputy Commissioner, Asst. Commissioner,
Superintendent, Inspector, Havildar and Sepoy).
In accordance with the NDPS Act and the
Central Excise Act, the powers of the Police officers are also vested into
executive officers of Central Excise and Customs. The personnel
of Central Excise and Customs are deployed on the borders (with Pakistan,
Bangladesh, Nepal, China, Myanmar etc.), International Airports and
International Sea Ports. They are also actively engaged in counter
insurgency operations against dreaded smugglers, hard core criminals etc.
within the country. These personnel have suffered heavy casualties while dealing
with trans-border crimes and countering with dreaded smugglers. Their duties
are akin to the Army and they are responsible not only for guarding the
Economics borders of the Country but also for security of the Nation. In fact
in J & K and North Eastern states of India, the Central Excise
personnel are deployed side by side with the Army, BSF, CRPF and ITBP on
the same location. They perform their duties in most adverse conditions coupled
with the threat to the lives of them & their families by enemy action, insurgents,
dreaded smugglers, hard core criminals and the climatic hazards.
The personnel of Central Excise and Customs
are deployed on the borders, International Airports and Sea Ports also being
actively engaged in counter insurgency operations against smugglers and tax
evaders etc. within the country. These personnel have suffered heavy casualties
while dealing with trans-border and other hard core criminals. Their duties are
akin to the Army and they are also responsible for security of the Nation. They
perform their duties in the most adverse conditions coupled with every threat
to the person & property along with their families.
It has been declared under OM F.NO.
8/B/90/HRD(HRM) 2011(Part-I)/4853 dated 21.10.14 and No. 30013/11/2011- Ad.IVA
dated 02.08.13 that the Central Excise Executive personnel perform their duties
in the nature and style of Military and Navy.
The Central Excise and Customs Executive officers, therefore, should also be
granted all benefits to be extended by 7th CPC to the Defence
personnel. The Central Government has decided to introduce ‘One Rank, One
Pension’ for Defence personnel. The executive officers of Central Excise
and Customs are uniformed officers having the same structural features, command
& control elements and also serving under similar harsh service conditions
as the Defence personnel. In spite of the similarities in the duties, the
Central Excise and Customs executive personnel are deprived of the privileges
extended to Defence and Police services. Under these conditions; if the
juniors start getting more pension than the seniors, it violates not only the
hierarchy of command system as is applicable to all Armed Forces but it is
unjustified in general also for the Govt. employees performing civil duties.
It is a well-established dictum
based on the Supreme Court judgement of 1982 and accepted by the Government
that “pension is not a bounty nor a matter of grace depending upon the sweet
will of the employer. It is not an ex-gratia payment but a payment for past
services rendered”. In another judicial ruling, it has been stated that
different criteria for grant of unequal pay/pension for the same rank on the
basis of cut-off date of retirement violates Article 14 (equality before law)
of the Constitution. Thus, all pensioners irrespective of rank are entitled to
same pension.
In the case of Defence services, the
Government has rightfully realized the truth of this fact and given succour to
the pre-2006 Defence pensioners to come up to the level of their post-2006
retirees of equivalent rank and status by granting them ‘One Rank, One
Pension’. However, the Central Excise executive pensioners having equitable
dispositions, command structure, rank system & nature of duties are grossly
ignored, discriminated & forced to face the ignominy of less emoluments
vis-a-vis their post-2006 retiring juniors.
SUGGESTIONS;
Therefore, we suggest & request that the Honourable Commission may kindly
be pleased to recommend for introduction of the system of ‘One Rank, One
Pension’ for the executive cadres of Central Excise and Customs also like
Defence employees.
(ii) RATE OF PENSION:
The rate of pension should kindly be at least 75% of the pay last drawn
or the average of 12 months emoluments last drawn, whichever is higher.
The minimum basic pension fixed by VIthe CPC was
Rs.3500/- which was 50% of the
minimum pay in the pay band (Rs. 5200/-) plus Grade Pay thereon (Rs.1800/-).
The consultants for Vth CPC, Tata
Economic Consultancy Services, taking all micro aspects into scientific consideration had suggested
that 67% of last pay drawn should be allowed as minimum pension. Considering the
passage of time since then, the quantum of increase in the GDP of the Nation, quantum of increase
in the per capita income and the expenses of the daily life, at least 75% of
the last pay plus Grade Pay is the need of the time as minimum pension.
The rate of
pension fixed by VIth CPC was 50% of the pay last drawn. The Hon’ble Supreme Court of India had in
the landmark judgement of D. S. Nakara and others Vs. Union of India (AIR 1983, SC 130)
clarified that a pension scheme must provide that the pensioner should be able to live at a
standard equivalent to the pre retirement level.
Conclusion:
SUGGESTIONS: We suggest & request that the
Honourable 7th CPC may kindly be pleased to recommend, even as a
partial compliance to the observation made by the Supreme Court, that the rate
of pension should be at least be
75% of the pay last drawn (band pay+grade pay) or the average of 12 months
emoluments last drawn, whichever is higher.
(iii) FAMILY PENSION:
The quantum of the family
pension is also required to be equal to the pension as the unfortunate death of
one member noway reduces the respect, decent status & expenses of daily
life of the remaining family in the time of today. It rather increases the
agonies of the family after sudden & unfortunate shock on account of demise
of family head. Untimely death in younger age makes it even harder requiring
more pension even equal to the salary of the deceased. The grant of family pension equal to the
pension will also give a bit consolation to the family of the deceased. At present,
merely 30% of last pay drawn is allowed as family pension.
SUGGESTION: .
We, therefore, suggest & request that the family pension may kindly be
equal to the pension.
(iv) ROUNDING OFF AND NOTIONAL DETERMINATION:
We suggest & request that the pension amount may
kindly be computed by rounding to the next multiple of Rs. 10/-. Pay band and grade pay system
introduced by VI CPC caused heavy disparities between pre and post 2006 retirees. The
concept of modified parity introduced by the 5th CPC as a measure to reduce the financial
implications must be replaced with the full parity concept as was made applicable for the personnel
retired prior to 01.01.86. In other words, the pay of every retired person must be
re-determined notionally as if he/she is not retired and then his/her pension computed under the revised
rules. This alone will protect the value of pension of a retired person.
(v) ADDITIONAL RATE OF PENSION:
Additional pension at the rate of 10% is required to be granted from the
age of 65 years and at the rate of 20% from the age of 80 years. According to the present scheme, a
consolidated amount reckoned at the commutation value of 8.194 is disbursed to the
pensioner at the time of retirement whereas recovery is effected for 15 years, i.e, for
approximately double the commutation value. As per a Note prepared by Ministry of Personnel,
Public Grievances and Pensions, Department of Pension & Pensioners’ Welfare {File
F.No.42/8180/2011-P&PW (G)}, the rate of interest at which commuted value of pension is fully recovered is
20.7% per annum in the case of employees who retired at the age of 60 years after 01.01.06.
This is, in fact, an enrichment of the exchequer at the expense of the poor pensioner which
cannot be justified by any stretch of reasonable argument particularly in a State where
socialism has been declared as the goal.
The pension of Central Government
pensioners/family pensioners undergoes revision only once in 10 years. The
pension structure gets seriously dis-aligned during this period as 50% increase
in price takes place even in less than 5 years. This results in considerable erosion
of the financial position of the pensioner and family pensioner. Dearness
Relief does not adequately take care of the inflation at this level. Working
employees are getting automatic relief by way of 25% increase in their
allowances with every 50% rise in Dearness Allowance. As pensioners do not get
any allowance, they feel discriminated. In order to strike a balance, Dearness
Relief should be automatically merged with pension whenever it goes to 50%.
Alongwith, 10% upward enhancement in pension/family pension be granted
every five years after the age of 65 years & up to 80 years. Thereafter, it
should be 10% more than the existing dispensation as in the present scenario of
high inflation, climatic changes, incidence of pesticides & rising pollution
old age disabilities/diseases set in by the time an employee retires and go on
manifesting very fast needing additional finances to take care of these
disabilities and diseases.
Hence, the restoration
of the commuted portion should be
done after 10 years instead of the present 15 years. In the case of pre-2006 retirees, the excess
recovered may be refunded to the pensioners. Senior citizens, during their
advanced age, have to bear additional financial burden due to age related diseases and social &
family obligations. So, additional pension/family pension at the rate of 10% may be granted from 65 years and
at the rate of 20% from 80 years of age after every 5 years. Moreover the present scheme of
additional pension @20% extra after 80 yrs and ...100% after 100 years is
denying any hike for the largest chunk of pensioners between 65 to 79 years.
Any statistics would show that the largest number of pensioners are in this age
gap. After 65 years ,the pensioners are to face health ailments and live with
medicines. .Considering the extra financial burden on these scores, there is
full justification to review the present system.
Hike in once in 5
years @ 10% would be fully justified. Thus, the revised formula should ensure
10% hike after every 5 years .Therefore, at 65 years 10 % hike; after 70 years
20%; after 75 yrs 30% ;after 80 years 40%; after 85 yrs 50%. (In India, the age
barrier of crossing 84 yrs is reckoned as a solemn occasion to have
observed/seen 1000 full moons in life span. This holy occasion should provide
50% hike in pension of all the pensioners.). thereafter again, 20 %each
hike at 90,95, etc should be allowed./envisaged(Admittedly, the
beneficiaries to avail above 50% after
85 yrs will be nominal considering the longevity at present .rather ,it will be
an envisaging provision ,but real takers/beneficiaries will be too minimal).
The reasoning for a truncated gradual hike to 20% at age of 80,with hike after
every 5 yrs is well justified.
SUGGESTIONS:
Accordingly, we suggest & request the following increase in the
basic pension/family pension:
Age (in yrs) Increase
in pension/family pension
65 ………………10%
70 ………………20%
75 ………………30%
80--------------------40%
85 ………………50%
85 ………………70%
90 ………………90% and so on.
85 ………………50%
85 ………………70%
90 ………………90% and so on.
(vi) MERGER OF
DA:
It was the well considered suggestion of Vth CPC
that DA should be merged with
basic Pay/pension/family pension whenever DA exceeded 50%. Now the DA has
exceeded 50% w.e.f. 01.01.11 and 100% w.e.f. 01.01.14.
It is, therefore, requested that 50% DA may kindly
be merged with basic pay/pension/family pension retrospectively w.e.f. 01.01.11
and the consequential arrears may
be disbursed to the employees as well as pensioners and family pensioners.
(vii) INTERIM
RELIEF:
It is requested that Hon’ble Commission may kindly
recommend 25% of basic pay/pension/family pension as Interim Relief to all the existing employees as well as
pensioners and family pensioners.
(viii) RATIONAL
METHODOLOGY FOR COMPUTING DA/DR:
A rational methodology for computing DA/DR is required to be evolved
and the periodicity changed to quarterly from the present half yearly. At present, DA/DR is given to the employees/pensioners on half yearly basis taking into account the average consumer price
index for 12 months. It is claimed that full neutralization of the cost of living is affected in
granting the DA/DR. But the claim does not stand the scrutiny of the contemporary economic
stratification. For example, on 01.01.06, i.e, at the time of implementation of VIth Pay
Commission, the DA/DR was nil. Now on 01.01.14 after giving full neutralization, the DA/DR
has arrived at 100%. The conclusion is that the cost of index based on the present methodology
of calculation has only doubled. But the reality is that the cost of essential commodities
has increased manifold.
Hence, a rational methodology for computing DA/DR is requested to be
evolved and the periodicity changed to quarterly from the present half yearly.
(ix) HEALTH
SCHEMES:
The existing Health Schemes such as CGHS, ECHS,
RELHS etc. are to be strengthened by providing
all facilities and extending to all the District Head Quarters of the country. The pensioner and family
pensioners not covered by the schemes should be provided with the facility of claiming medical expenses
for indoor treatment under CS (MA) Rules, 1944 as recommended by the Vth CPC. District
level nodal offices under each department may be recommended for reimbursement purpose.
The existing Fixed Medical Allowance in lieu of outpatient treatment is to be enhanced
to Rs. 3500/- per person and should be linked to the increase in Consumer Price Index.
(x) TAX
EXEMPTION TO SENIOR CITIZENS:
At present, senior citizens are exempted from Income
Tax up to Rs. 3 lakh only. Actually, pensioners/family pensioners should be
exempted from any tax. It is, therefore, suggested that the pensioner senior
citizens may be exempted totally from Income Tax or any other tax and other
(non-pensioner) senior citizens may kindly be exempted from Income Tax for an amount upto Rs. 6 lakh at
least.
(xi) FESTIVAL
ALLOWANCE:
Almost all State Governments grant festival
allowance to their pensioners. Actually, the senior
citizens are generally enthusiastic in celebrating every festival of their region/religion. We, therefore,
request the VIIth CPC to recommend the amount equivalent to one month pension
in a year as festival allowance
to the pensioners and family pensioners.
(xii) TRAVEL
CONCESSION TO PENSIONERS:
At present LTC is being granted to working employees
only. The pensioners’
organizations have been consistently and persistently demanding travel concessions to pensioners under a
rational and reasonable scheme. It is requested that a scheme may kindly be evolved under
which a pensioner/family pensioner along with family members is eligible for reimbursement of the cost of journey
within the country at least once in 2 years reckoned at actual entitlement
while the pensioner was in service. They may also kindly be allowed at least
one Foreign Leave Concession.
(xiii)
RESTORATION OF COMMUTED VALUE OF PENSION AFTER 10 YEARS:
The purchase value of pension gets
reduced day by day due to continuous high inflation and steep rise in cost of
food items & other requirements making over all steep rise in living cost.
Retired persons/senior citizens do not enjoy fully public goods & services
provided by Government due to lack of mobility and many other factors. Their
ability to pay tax gets reduced from year to year after retirement due to
ever-increasing expenditure on food, medicines and other incidentals. Their net
worth at year end gets reduced considerably as compared to the beginning of the
year. Inflation is much more than any tax for a pensioner. It erodes the major
part of the already inadequate pension. To enable pensioners to live in minimum
comfort at the far end of their lives and to cater for ever rising cost of
living, they should be spared from paying any tax including Income Tax. The
commutation value in r/o the employee superannuating at the age of 60 years
between 01.01.96 and 31.12.05 commuting a portion of pension within a period of
one year would be equal to 9.81 years purchase. After adding thereto a further
period of two years for recovery of interest in terms of observations of
Supreme Court in its judgment in Writ Petitions No. 395-61 of 1983 decided in
December 1986, it would be reasonable to restore commuted portion of pension in
10 years instead of present 15 years. In case of persons superannuating at the
age of 60 years after 31.12.05 seeking commutation within a year, numbers of purchase
years have been further reduced to 8.194. Also the mortality rate of 60+
Indians has considerably been reduced ever since Supreme Court judgment in 1986
and the life expectancy stands at 76 years now. Therefore, restoration of
commuted value of pension after 10 years
is fully justified.
On the issue of
Restoration of Commuted value of pension ,again, the system was never subjected
to a review after the hike in retirement
age from 58 to 60 yrs from 1998. So the Commutation table as well as the
restoration schedule need be subjected to a fresh evaluation taking into
account the inflation rate, interest rate, etc .The present formula of commuted
value, interest earned thereon as FD in bank, the net benefit (after tax on the
interest accrued) would be less than the case where the full pension is drawn
without opting for any Commutation. If the hike after every 5 yrs as suggested
above is acceded to, ,there will be a definite fall in the no. of pensioners
opting for Commutation. Hence steps must be taken to make the Commutation
scheme without imposing a financial loss to the pensioners. Restoration must be
allowed just after the completion of the commuted period for all pensioners.
(xiv) HASSLE
FREE HEALTH CARE FACILITY TO PENSIONERS/FAMILY PENSIONERS:
As far as
health is concerned, it is not a luxury and it should not be the sole
possession of a privileged few only. It is not only a welfare measure but also
a fundamental right of all present & past employees. To ensure the
hassle free health care facility to pensioners/family pensioners, Smart Cards
should be issued to all pensioners, family pensioners and their dependents for
cashless medical facilities across the country irrespective of department.
These smart cards should be valid in all Govt. hospitals, all private &
Govt. Multi Super Specialty hospitals and all CGHS, RELHS & ECHS empanelled
hospitals across the country. No referral should be insisted for medical
treatment or tests. The Doctors/Medical officers working in different Central/State
Govt. department dispensaries/health units should also be recognized as
Authorized Medical Attendant.
The enjoyment of the highest attainable
standard of health is recognized as a fundamental right for all in terms of
Article 21 read with Article 39(c), 41, 43, 48A and all related Articles as
pronounced by the Supreme Court in Consumer Education and Research Centre &
Others vs Union of India (AIR 1995 Supreme Court 922). The Supreme Court has
held that the right to health to a worker is an integral facet of meaningful
right to life to have not only a meaningful existence but also robust health
& vigour. Therefore, the right to health and medical aid to protect the
health & vigour of a worker alongwith family while in service or after
retirement is a fundamental right to make life of a worker meaningful and
purposeful with dignity. All
pensioners, irrespective of pre-retirement class & status, should be
treated as same category of citizens in r/o health. There should be no class or
category based discrimination and all must be provided health care services at
par. To ensure that the hospitals do not avoid providing reasonable care to
smart card holders and other poor citizens, a Hospital Regulatory Authority
should be created to bring all hospitals and diagnostic labs under its constant
monitoring for quality, rates & timely bill payments by Govt. agencies
& Insurance companies. CGHS rates should be revised keeping in mind the
workability and market conditions.
(xv) FIXED MEDICAL ALLOWANCE TO PENSIONERS/FAMILY PENSIONERS:
As recorded in Para 5 of the minutes of Committee of Secretaries (COS)
held on 15.04.10 {Reference- Cabinet Secretariat, Rashtrapati Bhavan No
502/2/3/2010-C.A.V Doc No. CD (C.A.V) 42/2010 Minutes of COS meeting dated
15.4.2010} discussing the enhancement of FMA and CGHS card estimates for
serving Personnel (since estimates are not available separately for
pensioners), M/O Health & Family Welfare had assessed the total cost per
card per annum in 2007-08 to be Rs. 16435/-, i.e., Rs.1369/- per month for OPD.
Adding to its inflation, the figure today is well over Rs. 2000/- per month.
Ministry of Labour & Employment, Govt. of India vide its letter no.
G-25012/2/2011-SSI dated 07.06.13 has already enhanced FMA to Rs 2000/- per
month for EPFO beneficiaries. Thus to help elderly pensioners to look after
their health, adequate raise in FMA will encourage a good number of pensioners
to opt out of OPD facility which will reduce overcrowding in hospitals. OPD
through insurance will cost much more to the Govt. Thus, the proposal for
raising Fixed Medical allowance to Pensioners is fully justified and is
financially viable. The FMA for all pensioners/family pensioners should be
raised to at least Rs. 2500/- per month without any restriction of
linking it to Dearness Relief for further automatic increase. The FMA should
also be exempted from any tax including Income Tax as it is a compensatory
allowance to reimburse the medical expenses. The actual expenses made in
addition to FMA should be reimbursed in hassle free manner.
The Ministry of Personnel and Pensions has launched
an initiative to route the skill and experience of retired government employees
back into socially useful and constructive work. Retired Government employees
can soon find employment opportunities back in government departments and other
social organisations on a voluntary basis. There are 50 lakh government
employees today. But there are also 53 lakh retired employees, the most of whom
can still contribute to Nation building exercise. Govt. should tap their skills
and experience.
It is
suggested that Honourable 7th CPC
may be pleased to recommend for creation of a separate cell for welfare
of retired employees in each and every office and these cells should kindly be
managed by willing retired employees only.
(xvii) HOUSE
RENT ALLOWANCE TO PENSIONERS/FAMILY PENSIONERS:
House Rent allowance is also required to be granted
to all pensioners and family pensioners. It is requested that the Hon’ble
Commission may kindly be pleased to recommend the grant of tax free HRA to all
pensioners/family pensioners at the rates on which it is being given to the
serving employees in accordance of the status of the pensioner at the time of
retirement.
It is also requested that kindly condone the delay in
submission of our memorandum and the representatives of our Association may
also kindly be given an opportunity
to present our case in person and give oral evidence in support of the submissions
detailed in this Memorandum and also to allow
the Association to add, alter, amend or delete any submission made hereinafter
in the interest of its members and to facilitate the Commission to discharge
its duties entrusted with.
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