Friday, July 29, 2011




26th July, 2011

Dear Comrades,


More than 800 delegates representing AISGEF, Confederation of CGE & W, AIRF, AIDEF, STFI, AIFUCTO, BSNLEU, DREU and various Pensioners Associations participated at the National Convention on PFRDA Bill held at MPCU Shah Auditorium on 22nd July,2011. The proceedings of the convention were conducted by a presidium consisting of the following comrades:

Com. R.G.Karnik(AISGEF)

Com.S.K.Vyas(Confederation of CGE&W)


Com.Sardara singh(AISGEF)

Com.N.Narayaana (STFI)

Com.V.A.N. Namboodiri (BSNLEU)

The declaration was presented by Com. Sukomal Sen, Vice President( AISGEF) and seconded by Com. S.K.Syas(Confederation of CGE&W), Com.Basudeb Acharya, M.P., Com. Tapan sen, Genl.Secy (CITU), Com. M.K.Pandhe, Vice President (CITU), Com. Bhatnagar (AlIEA), Com. Pradeep Biswas (BEFI) addressed the convention. Besides, leaders of all participating Federation, viz shiv Gopal Misra (AIRF), Com. Rajendran(STFI), Com. Ashok Kumar Burman(AIFUCTO), Com. R. Muthusundaram (AISGEF),Com. Abhimanyu (BSNLEU)Com.Sardara singh(AIDEF), Com.Elangovan(DREU), Com. M. Krishnan(NFPE), Com. Shyam Sundar(BCPC) spoke to detail the dangers posed to the existing pensioners and the serving employees when the contributory scheme is brought in operation. Com. K.K.N Kutty, Secy.Genl., Confederation of CGE&W summed up the discussion and sought and obtained the approval of the house for the following programmes of action.

1. To organise a mass signature campaign to be submitted to the Prime Minister. (The draft prepared and circulated was felt to be too lengthy to employ it for a signature Campaign. Therefore it was decided to have a small petition (copy given enclosed) which could be used for the campign.)

2. The standing committee can be approached for a hearing by the participating organizations. The original draft letter addressed to the PM may be used as a background paper to prepare the petition to the Chairman, Standing Committee.

3. To organise joint State level Conventions between 1-8-2011 and 6-9-2011.

4. To organise March to Raj Bhawan preferably on 6-9-2011 at all state capitals.

5. To organise March to Parliament.

6. To organise a day’s strike.

The dates for the program at (5) and (6) will be finalized by the Steering Committee consisting of representatives of all participating Federations. The Steering Committee is expected to meet in the last week of August, 2011. The convention approved the setting up of the steering committee.

On behalf of the Presidium, the concluding speech was delivered by Com. R.G.Karnik. He appealed to all the participating organizations to take strenuous efforts to ensure full participation of their members in the programmes to compel the Government to rescind their decision and withdraw the Bill from the parliament.

With greetings,

Yours faithfully,


Secretary General


We submit this petition to bring to your kind notice certain aspects of the re-introduced PFRDA Bill which will have an extremely adverse impact on the pension and retirement benefits of the Government employees. We may also state in this connection that the contributory pension scheme will be a drain on the exchequer.

The guiding principle adopted in determining the pay package of civil servants is to spread out the wage compensation over a long period of time because of which the wages during the work tenure is low to enable pension payment on retirement. This makes the pension a ”deferred wage”, which the Supreme Court has upheld as such in their landmark judgment in the case of D.S. Nakara Vs. Union of India. As the bill does not provide implicit or explicit assurance of a minimum pension except marked based guarantee, the civil servant even after contributing huge sums to pension fund may end up with no annuity if the invested company become bankrupt or the equity market crashes. Moreover the annuity which would be the pension under the new scheme being not cost indexed will make it difficult for the pensions to make the both ends meet.

The Committee set up by the 6th CPC has concluded that the new contributory pension scheme will increase the outflow from the exchequer from Rs. 14,284 Crores to Rs. 57088 Crores by 2038. The Committee has also observed that the pension liability of the Government which was 0.5% of the GDP in 2004-05 under the defined benefit scheme is likely to decline if the same is not replaced by the contributory pension scheme as envisaged in the PFRDA bill. The Committee has ultimately recommended that the existing “Pay as you go” pension which is presently in vogue will be ideal and may be continued.

Since the new scheme is neither in the interest of the country as it increases the outflow on account of pension liability nor to the Civil Servants for it does not guarantee a minimum pension, we appeal to you kindly cause withdrawal of the PFRDA Bill from the Parliament immediately.

Thanking you,

Yours faithfully,

Sunday, July 24, 2011



A-2/95,Manishinath Bhawan,Rajouri Garden, New Delhi-110 027

Tel: 011-2510 5324: Mobile: 98110 48303

Dear Comrade,

The National Secretariat of the Confederation will meet, as intimated earlier at Chennai on 30th July 2011 at 11 AM. The venue of the meeting is as under.

KVB Hall

4th Street, Sourastra Nagar,

Near Nagambakkam railway Station.


The comrades who will reaching Chennai may contact Com.M. Duraipandian or Com A Sundaram whose telephone No. are given under.

M.Duraipandian- 09789833552


The women delegates who will attending the women Sub Committee meeting will be received at Chennai Central Station by host unit comrades. They may Contact incase of any difficulty Com Sundaran or Com.M.Duaripandian at the above telephone numbers.

With Greetings

Yours faithfully


KKN Kutty

Secretary General.

Monday, July 4, 2011

Postal strike deferred

Placed hereunder is the Confederation circular No. 14.


A/295 Rajouri Garden, New Delhi. 110 027

Conf/14/2011, dated 4th July, 2011.

Dear Comrade,

          The indefinite strike for which the call was given by the Joint Count of Action of the Postal Employees has been deferred.  The decision was taken after a prolonged negotiation with the Postal authorities.  We give hereunder the communication we have received from them for your information.  You may inform the branches of the affiliates  and  the district units of this development.

          With greetings,

Yours fraternally,

K.K.N. Kutty

Secretary General.


Consequent on the settlement reached between Secretary, Department of Posts and the Staff Side the Central JCA unanimously decided to defer the indefinite strike from 5th July 2011. Positive settlement is reached on major items of the Charter of demands. Gist of the settlement reached on all items of the Charter of demands will be published soon. We have made it clear to the Postal Board that if any violation of the assurances take place, or if orders on the agreed items are not issued without any delay, the Central JCA will commence indefinite strike without any further notice. We have not called off the strike. STRIKE STANDS DEFERRED. WE SHALL ALWAYS BE VIGILANT. Hectic and elaborate discussions took place with the Postal Board on 6th, 7th, 27th, 28th, 29th, 30th June 2011 and on 1st July 2011. Secretary Generals and All General Secretaries participated in the discussion.

Central JCA salutes and congratulates all the Circle/Divisional/Branch Secretaries and the entirety of Postal and RMS employees including Gramin Dak Sevaks for the mobilization made by them for the successful implementation of the strike. It is only because of the determination and courage of the grass root level workers the Postal Board is compelled to come for a settlement.

Friday, July 1, 2011

Circular No.13


A-2/95,Manishinath Bhawan,Rajouri Garden, New Delhi-110 027


Conf.Cir.No.13/2011 Date: 30-06-2011

Dear Comrade,

In continuation of our circular letter No 12, we are to inform you that the proposed National Convention will be held at MPCU Shah Auditorium, New Delhi on 22-07-2011. We give hereunder the quota of delegates for each state and request the state committees to initiate steps to identify comrades as delegates and book tickets for them. We send herewith a copy of the draft letter to be submitted to the Prime Minister obtaining signature from the employees. The draft may come up for discussion at the convention. The convention will also discuss and decided future course of action in the matter. Kindly inform us the addition if any you would like to propose to the draft petition.

With greetings, Yours fraternally,


Secretary General

Quota of delegates

Kerala-2, Tamilnadu-10, Andhra Pradesh-10, Karnataka-5, Mumbai-15, Vidharba-10, Madhya Pradesh-15, Orissa-5, West Bengal-10, North Eastern Region-5, Bihar-5, Jharkhand-2, Chattisgarh-2, Uttar Pradesh-30, uttarakhand-2, Rajesthan-15, Gujarath-10, Punjab-3, Haryana-2, Delhi-15 ,J&K-1

Draft Petition addressed to the Prime Minister For Signature campaign.


The Prime Minister of India,

New Delhi

Sub: Request for Scrapping of PFRDA Bill


We submit this Petition to bring to your kind notice and through your good office to the attention of the Honorable Parliamentarians of our country certain aspects of the re-introduced PFRDA bill, which will have adverse impact on the exchequer in general and on the prevailing service conditions of the Civil Servants. We pray that our submissions in this regard may please be caused to be considered earnestly and the implication of the provisions of the bill critically analyzed and examined and take decision to kindly withdraw the Bill from the Parliament.

We submit the following for your critical and objective analysis of the Bill :

1. The concept of old age security for civil servant in the form of pension has a very ancient

origin dating back as early as third century BC, the quantum being half of the wages on completion of forty years blemishless service to the king.

2. In the last century, one of the measures taken by the colonial rulers to attract talented

personnel to the Royal service was the introduction of pension scheme for civil servants `in 1920. The Royal commission through its various recommendations improved the scheme and the 1935 Government of India Act provided it statutory strength.

3. The land mark judgment of the Supreme Court in D .S. Nakara and others Vs. Union of

India (AIR-1983-SC-130)(applicable to the Central and State Government employees, teachers, and all stake holders of pension system) conceptualized pension stating that pension is neither a bounty nor a grace bestowed by the sweet will of the employer, but a payment for the past services rendered. It was construed as a right step towards socio-economic justice and a concrete assurance to the effect that the employee in his old age is not left in the lurch.

4. The fifth Central Pay Commission which was set up by the GOI in 1993 to go into the wage structure and pension scheme of the Central Government employees referring to the Judgment of the Supreme Court cited, observed (Para 127.6) that " pension is the statutory, inalienable and legally enforceable right earned by the civil servant by the sweat of the brow and being so must be fixed, revised, modified and changed in the way not dissimilar to salary granted to serving employees."

5. The guiding principle adopted in determining of pay package of civil servants is to spread out

the wage compensation over a long peiord of time whereby wages paid out during the work

tenure is low in order to effect payment of pension on retirement. As such civil service pension

is rightly termed as deferred wage. While in the organized private sector the employer is

required to contribute equal share to the Provident Fund of the employees, the Government

neither contributes to the Provident Fund of the civil servants nor takes any pension subscription from him.

6. In an unwarranted intervention in the Statutory defined benefit Pension system, the IMF in

their work paper (WP/01/125,(2001) propounded the creation of a pension fund by eliciting

from the Wage earners at the earliest stage of their employment so as to fetch an

annuity decent enough to sustain him at the old age. In fact it was a suggestion for a retrograde

change over from the defined benefit pension scheme to a defined contributory system. While

suggesting so, they have categorically stated that India does not suffer demographic pressure

experienced by major countries, for India's population beyond the age of 60 was about 7% in

2004ch rose to 8.6% in 2010 and is estimated at 13.7% in 2030 and 20% in 2050.

7. The New contributory pension scheme enunciated by the Government of India and adopted by

most of the State Governments is covered by the PRFDA bill. The bill inter alia, envisages a

social security scheme for all who desire to have an annuity at his old age which is voluntary

and not mandatory. However, in the case of Civil Servants, who are recruited to Government

service after the prescribed cut -off date ( 1.1.2004 in GOI service) the scheme is mandatory in

as much as the employee is bound to subscribe 10% of his emoluments to the Pension Fund

and the Govt. being the employer would contributes equal amount. No employee is entitled to

opt out of the scheme.

8. Despite the inability to bring in a valid enactment, the Central and all State Governments other

than those of West Bengal, Kerala and Tripura through illegal executive orders decided to

impose the contributory pension system arbitrarily on the Central and State Government

employees .While the Govt. of India notification excluded the personnel in the armed forces

and para-military establishments, the Governments of the Left ruled States of West Bengal,

Kerala and Tripura consciously continued with the existing defined benefit pension system.

9. The PRFDA Bill stipulates that there will not be any explicit or implicit assurance of the benefit except market based guarantee. The subscriber is thus exposed to the following risks at the exit.

a) If there is a major market shock, the subscriber to the New Pension scheme may end with no ability to purchase an annuity.

b) Since annuity is and cannot be cost indexed, the real worth of the annuity might fall depending upon the inflationary pressure on the economy.

c) As per the scheme, the subscriber is to make the choice of investment portfolio. The Civil Servant being mostly uninformed in finance and investment related matters, he might end up in making wrong choices which would eventually rob him of the old age pension.

d) The subscriber is perforce to contribute to the charges of the investment managers, whose priority often is as to how much profit they could make through investment of the huge corpus of pension fund in the volatile share market .

10. The pension fund created by the employees' subscription and the employers' contribution which directly flows from the exchequer ( which is nothing but tax revenue of the Govt.) is made available for the stock market operations which is not only unethical but also blatant diversion of public fund for private profit, both Foreign and Indian capitalists.

11. In the case of Civil Servants recruited after the cut-off date, the new scheme replaces the existing much better "defined benefit" pension scheme. In the process, the Government has created two classes of civil servants viz. the one with a defined benefit pension scheme and the other with the contributory pension scheme in which the employee is to part with 10% of his emoluments to become entitled for an old age social security subject to the vagaries of share market permits. Since in both the cases, the pay, allowances, perks, and other benefits, privileges, duties and responsibilities are the same it amounts to wanton discrimination of one against another which is not sustainable in law, rather violative of the existing constitutional provisions.

12. The wage structure presently designed for those who are recruited prior to the cut- off date and after is on the same premise and is depressed to enable the Govt. to meet the pension liability in future. By imposing the new contributory pension scheme on the employees who are recruited after the cut off date the Govt. not only denies the statutory defined pension benefit to them but also compel them to contribute for earning an undefined annuity, which must be characterized as highly discriminatory.

13. Those who are covered by the contributory pension scheme will become entitled for an annuity, a portion of the accumulated contribution is able to purchase, basing upon the accretion to the fund from the investment. There is, however, no guaranteed minimum amount of pension for those who are covered by the new scheme, whereas the civil servants covered by the existing scheme do get a defined and guaranteed minimum pension and on his death his family members (wife, widowed and unmarred daughters and unemployed sons below the age of 25) become entitled for family pension. The discrimination factor is thus compounded.

14. The PFRDA Bill when enacted, it is rightly feared, will empower the Government to alter or even deny the present employees and pensioners the statutory defined pension benefit as has been done in the case of those who are appointed after the cut-off date.

15. It is stated that the prime objective of the introduction of the contributory pension scheme is to substantially reduce the outflow on account of pension liability. The major pension liability of Government is accounted for by Armed Defence personnel. They are however excluded from the purview of the contributory pension scheme. The personnel in the Para Military forces are also excluded from the ambit of the new Scheme. While doing so, (no doubt to attract the people to serve in the armed forces for security of the Nation) the Govt. is bound to meet the pension liability from the consolidated fund of India. The argument advanced by the Govt. to cover the Civil Servants in the ambit of the new Pension scheme has been found to be unsustainable by the study commissioned by the 6th CPC. Shri S. Chidambaram, Actuary, in his report, (Annexure to "A study of Terminal benefit of Central Government employees by Dt. K. Gayatri, Centre for Economic Studies and policy, Institute for Social and Economic change, Nagarbhavi, Bangalore) has pointed out that the Government liability on account of contributory pension scheme would in effect increase for a period spanning for the next 34 years from the existing Rs. 14,284 Cr. To Rs. 57,088 Cr. ( 2004-2038) and is likely to taper off only from 2038 onwards. The exchequer is bound to have an increased outflow for the next 34 years and will be called upon to bear the actual pension liability of defence personnel and personnel of para military forces, besides making the contribution to the Pension fund of the Civil Servants recruited after the cut off date. The specious plea that the exchequer is bound to gain due to the contributory pension scheme is therefore not borne from facts.

16. Of the present pension liability of the Govt. of India, which in 2004-05 was 0.51% of the GDP, 0.26% is accounted for by the Defence( which is 50% of the total pension liability.) The study report of the Centre for Economic Studies has concluded that the pension liability as a percentage to GDP which is just 0.5% presently is likely to decline given the growth rate of Indian economy.

17. Since most of the State Governments have chosen to switch over to "contributory pension scheme" , in fairness ( from the Study conducted by the Centre for Economic Studies and policy) it can be concluded that the pension liability of all the State Governments are bound to increase to three times of what it is today by 2038.

18. The first version of the PFRDA Bill was placed before the Parliament by the NDA Government in 2003. The 6th CPC set up the Committee to go into the financial implication on account of the increasing number of pensioners and suggest alternative funding methodology in 2006. The said Committee came to the inescapable conclusion (report submitted in 2007) that "the existing systems of pension are increasingly becoming complicated after the introduction of the New Pension scheme" and warned that "caution has to be exercised in initiating any further reforms" In the light of the conclusion of the said study report which revealed the fact of serious escalation in the pension payment outflow, the rationale of the re-introduction of the PFRDA bill in 2011 covering the civil servants is incomprehensible. Undoubtedly, the Bill when enacted into law will through the existing pensioners to a financially insecure future and the existing workers to the vagaries of the stock market. We, therefore, earnestly pray to your good-self to bring back all the civil servants including teachers irresespective of the date of entry into Government service as also those irregularly appointed within the ambit of the existing statutory defined pension benefit scheme.

We may, in fine, quoting the concluding paragraph (Page 76 of the report of the Centre for Economic Studies and Policy – Institute for Social and Economic Change) of the Committee set up by the 6th CPC

"Mainly given the fact that the future liability although may be large in terms of absolute size is not likely to last very long and does not constitute an alarmingly big share of the GDP which is also on the decline. It appears that pursuing the existing 'Pay as you go' to meet the liability will be an ideal solution."

appeal you, for the detailed reasons adduced in the foregoing paragraphs, that the new pension scheme enshrined in the PFRDA Bill may be withdrawn from the Parliament both in the interest of the Civil Servants and the exchequer.

With regards,

Faithfully, yours,

State : ………………….

Date : July, 2011