Pension fund and 2% load !

Let me explain about P.F. Fund and Pension Fund from my understanding.
P.F is deducted at the rate of 10% of Basic Pay from Employee.
An equal amount is contributed by bank to the P.F. account of employee
These amounts are credited to the P.F. trust account of the individual banks.
Representatives of recognised unions will find place in the Board of trustees.
They have access to the Income/Expenditure account and balance sheet of the trust.
The amounts deposited in the account are invested in various financial instruments like
Govt., Bond etc., Income generated will be utilized for giving interest to employees account.
At the time of retirement the amount (both employee contribution and Bank contribution)
standing in the concerned employee will be given to the employee
This is the procedure of Contributory P.F. system.
In case of Pension Fund what is happening?
In 1995 Pension was introduced in Banking sector.
At that time, amount lying in P.F. trust (belonging to Pension opted employees)
is transferred to Pension fund of the individual Banks.
Thereafter 10% contributions from employees were credited to P.F. Trust account.
10% Contribution by Bank was/ should be credited to Pension Fund.
The amount thus accrued in Pension Fund is invested and income generated also
credited to Pension Fund .
Out of this fund only, Pension to all retired employees who opted for Pension scheme,
Commutation amount and family pension for the diseased employees, are disbursed every month .
Now my doubts are
1. Whether union representatives are members of any governing board of Pension Fund?
2. If not, Why? After all, the fund belongs to employees.
3. Whether Union people have access to read Income /Expenditure account and
Balance Sheet of the fund?
4. Whether unions are aware of what is the income generated in this fund every year?
5. Whether Bank is contributing 10% of Basic Pay of all employees every month to Pension Fund?
(or contribute some funds at their will and pleasure. )
Whether Banks have contributed the 2/3 amount of additional cost, as accepted by in 9th B.P.S?
6. Whether UBFU is accepting the figures given by IBA , without any scrutiny.?
Replies received under RTI act by some interested comrades, reveals that Pension Fund is not maintained as if it should be maintained.
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9th B.P.S. and Pension fund!
At the time of every B.P.S , IBA will tell that “pension fund is short of funds.
To retain its viability some sacrifice from employee side is needed “
In 7th and 8th some % in increase in wage revision is sacrificed/compromised.
At the time of 9th B.P.S , employees under Contributory P.F. system also want to join Pension scheme.
Then IBA said Pension Fund can’t bear the additional cost due to joining of more employees to the scheme. Further it said that additional cost to be shared by Banks and employees. Unions accepted for this deal. Then what will the additional cost ? IBA gave a huge figure that is far away from actual expenditure. Then BEFI intervened and produced a document containing the actual projection of additional cost. It is much much lesser amount than what is given by IBA. All the unions in UFBU and IBA
accepted the document after verifying the correctness of the projections.
Then it was decided that 2/3 of additional cost will be borne by IBA and 1/3 will be borne by employees.
The amount so decided are recovered only from those employee who newly joining the Pension scheme. (Thanks to one leaf of two leaves union’s change of stand at the last minute)
Thus a section of employees paid penalty for joining Pension Scheme, even though this section of employees suffer from lesser wage revision for the sack of employees already in Pension Scheme.
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10th B.P.S. and Pension fund!
This time also IBA said that “since merger of D.A. with Basic Pay is much higher and consequent Pension disbursement will also be high.
(Mere merging of D.A will not increase pension. Because D.A. is reduced correspondingly. Only loading in addition will make the difference.)
Pension Fund can’t bear the additional burden.
Hence restrict the loading to 2% instead of 15 % “. Unions accepted the IBA’s argument and signed in the dotted line.
1. My question is, if any document containing the projection of additional cost due to merger of D.A to Basic Pay with 15% loading, is given to UFBU?
2. What is the additional cost mentioned by IBA?
3. Whether unions have analysed and come to a conclusion?
4. On what basis UBFU accepted the proposal of loading 2% only on Basic Pay?
(which is not a practice in previous occasions)
Members have the right to know about this decision.
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What will happen in 11th B.P.S.?
IBA will again say Pension Fund can’t bear additional cost. Therefore Pension will not be paid
at 50% of last drawn Basic Pay.
Only 40% of last drawn Basic Pay will be paid as Pension hereafter,
UFBU will accept and sign.
My advance condolences, to those who are going to retire from 01.11.2017.
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Source: http://banknewskumar.blogspot.in/

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