OPEN REPRESENTATION TO THE Hon'ble PRIME MINISTER of BHARAT
Namaste,
SUB: Restoration of Commutation in 12
years–request for ‘suo moto’ action by the Government.
On behalf of lakhs of pensioners, who form a
big percentage of honest tax-paying citizens of Bharat, we request you, Hon’ble
Prime Minister of Bharat, to kindly bestow your personal intervention to take
“suo moto” action immediately, to stop recovering the commuted portion of
pension from pensioners above 72 years of age, 12 years after their retirement,
since the commuted portion of pension stands fully recovered in less than 11
years. We earnestly request you not to wait for the 8th Central Pay Commission Report, which you have constituted in right earnest and which we
greatly appreciate and welcome, since we would have aged still more and may not
be able to enjoy the benefit of your early benevolent action.
As per the Supreme Court of India judgment dated 09/12/1986, repeat 1986 (39 years ago), delivered in Writ Petition No. 3958-61 of 1983( 42 years ago), "COMMON CAUSE" A REGISTERED SOCIETY AND OTHERS Vs. UNION OF INDIA, the Supreme Court, had noted in the matter of commutation of pension, that “In dealing with a matter of this nature it is not appropriate to be guided by the example of Life Insurance; equally unjust it would be to adopt the interest basis. The conclusion should be evolved by relating it to the ’years of purchase’ basis. An addition of two years to the period necessary for the recovery on the basis of years of purchase justifies the adoption of the 15-year rule, which appears to be equitable.’
The past Governments and, unfortunately, the present administration have conveniently latched on to this "15 years " mentioned in the 1983 year case but have conveniently disregarded the Hon’ble Supreme Court order of 1986, on years of purchase plus two years. But we trust, you understand the plight of Senior Citizens, and more so the septuagenarian pensioners, who, nowadays are solely dependent on themselves and their pension.
For commutation, the years of purchase are now 8.194. Adding two years for
interest, it should ideally be 10.194 years after which the commutation should
be restored as per the SC judgment of 1986. With 8% interest, the entire
commutation is recovered in 8.194 years (purchase years) for the principal and
2.66 years for the interest which means the commutation is fully recovered in 10.85
years. It is unfortunate that the Govt., is arbitrarily and unjustly extracting
15-10.85=4.15 years of excess amount from the pensioners.
Even the Second National Judicial Pay Commission (SNJPC) in its report in year 2020 (5 years ago), has concluded that :
"Restoration period of 12 years suggested by Vth CPC appears to be
more than adequate. In fact as per the workings given by the Commission supra,
it is seen that the lump sum paid in lieu of commutation stands recovered with
interest of 8% within 11 years. Even after giving due allowance for
unforeseen contingencies, prima facie, it is reasonable to conclude that the
restoration ought to take place on the expiry of 12 years and not beyond
that".
The Department
of Pension & Pensioners' Welfare has itself produced a written
document to Second National Judicial Pay
Commission wherein it has itself agreed, in unambiguous terms, that Commutation
is fully recovered in 12 years.
Thousands
of pensioners are being
forced to go to courts for a stay on recovery of commutation beyond 10.85 years when the entire amount of commutation of pension stands
recovered in less than 11 years. Most courts grant a stay. But some say it is the Supreme Court order of 1986 and forces us to appeal.
Assuming
that the Govt., with a magnanimous heart, reduces the period of recovery to
12 years as per the recommendations of the Vth Pay Commission and the Second
National Judicial Pay Commission [ See part III (Supplemental Report)],
the additional amount of recovery made from all the pensioners of
Bharat in 1.15 (12-10.85) years can be invested in some LIC
policy or as the government may deem
fit, to cover the risk factor of those pensioners, who may unfortunately die
before 72 years.
Facts are:
The death rate between the years 60 -64 is 1.95%, between
65-69 is 3.13 and between 70 -74 is only 4.75% in the year 2018 and may be much
lower now ( Source: India: mortality rate among elderly by age group | Statista )
In simple language, if there are 100 pensioners, 8.83
(1.95+3.13+4.75 = 8.83) would probably die in the 14 years between 60 and 74
years. That is an average of 8.83/14 = 0.74 per cent per year. This means an
average of 99.26 % of pensioners would be alive and 92.17 (100 minus 8.83)
pensioners, who have crossed 72 years, would have already paid 92.17 multiplied by 1.15 yrs (12yrs minus 10.85 yrs) multiplied by Commuted value of pension paid monthly
(additional 14 instalments per pensioner), which should be more than sufficient
to offset the loss incurred by the Govt, if any. Also Govt. would be paying a
lowered pension to the family pensioners.
In other words for every 100 pensioners, the excess recovery that would be made, even if recovery of pension is stopped after 12 years, is a very sizeable amount to the tune of :
92.17 * 14 * Monthly commuted value of pension
Hence the recovery of commutation of pension beyond
12 years appears not only unfair, unjust and arbitrary, causing grave misery
and injustice to the pensioners, but is also against all ethical values, which
a welfare state should follow. We believe that this fact has not been
brought to your personal attention, otherwise, we are certain, the issue would have
been sorted out long back.
Your personal affection and concern towards elders and your interest in the welfare of the elders could save us, pensioners, from being forced to pay to the Govt., nearly 50% more (4.15 years is more than 50% 8.194 years, which is the years of purchase) than what we have been paid for. Hence, it is humbly requested that the office of the Honourable Prime Minister of Bharat may kindly consider our plight sympathetically and initiate ‘suo moto’ action to amend the Rule 10A of CCS (Commutation of Pension) Rules, 1981, as hereunder:
“The commuted
amount of pension shall be restored on completion of twelve years from
the date the reduction of pension on account of commutation becomes operative
in accordance with rule 6:
Provided that when the commutation
amount was paid on more than one occasion on account of upward revision of
pension, the respective commuted amount of pension shall be restored on
completion of fifteen years from the respective date(s)”
The amended rules may be made effect from
01.01.2024 or earlier. It would only be justified for the government to pay back to the
pensioners the excess recovery made.
JAI HIND !
