OPINION
Political economy of extension in age of retirement
- Dr. Pyara Lal Garg
Political economy of extension in age of retirement



THE TOTAL EXPECTED Revenue receipts of Punjab Government for the year 2017-18 as per Budget estimates are to the tune of Rs. 60,080 crore, while the estimated expenditure is Rs. 74,864 Crore. Revenue deficit is pegged at Rs. 14784 Crore which is 3.18% of the GDP (Gross Domestic Product) for the year. In this total expenditure, Rs. 30979 crore (51.56%) that is more than half is to be incurred on salaries and pensions alone. Salary component being 20,832 crore and that for pension Rs. 10,147 crore.
 
Another addition is the interest payments on the loans raised; the same turns out to be Rs. 14,149 crore. After taking into account these three items the remaining amount for all other chores is Rs. 14,952 crore. These figures speak of the tragedy of the economy of Punjab, in it are hidden the secrets of the suicides of farmers and farm labour, the secrets of abject poverty in rural areas and the secrets of the unemployment of around twenty lakh youth out of a total of 1 crore 8 lakh youth in age group of 15 -34 years.
 
In the Budget no major effort has been resorted to reduce the debt burden by reducing the unnecessary expenditure or by making the administration act promptly in accordance with law. In reduction of expenditure and for providing employment to youth, the key item was to have a thorough look at the employees and officers deployed in Government departments and Semi Government organisations, but the same has not been undertaken.
 
The previous Government had permitted two year extension in service to the employees, as a consequence about 25,000 employees and officers who were to retire remained in jobs. With this loop sided policy, the expenditure on salaries and other facilities to these employees has increased , the chances of employment to youth have been given a heavy blow. The factors and reasons being quoted behind this policy of extension in age of retirement are that the Government has no finances for payment of retiral benefits to the retiring employees.
 
In the recent past when the Government started thinking on the issue of reverting back to the policy of retirement at 58 years, hurdles have been created by the bureaucracy and the rest of the employees by presenting fake figures. Initially they made out that Rs. 1700 crore is required for giving retiral benefits, then said Rs. 2600 crore is required which in order to give a last blow was projected to be Rs. 5000 crore.
 
The trend of getting wrong decisions and favourble decisions for the personal gains of the involved ones, by giving wrong data, fake figures and by way of concealment's is increasing because no action is initiated against such authorities who deceive the Government by way of fake data. The inaction on the part of the Government has emboldened such officers for other irregularities and  a huge increase in the Government expenditure is the outcome. The same however is unnecessary and is not required to be incurred at all otherwise.  

If we analyse the facts and figures, we find that the officers who have attained the age of superannuation that is the age of 58 years, and who are still working in state administration as PCS or PPS officers or are working in the departments of, Excise and Taxation, Agriculture, Education (schools and colleges), PWD, Finance, Planning, Panchayat Raj, Rural Development, Civil Supplies, Revenue,  Health, Medical Education and so on, in the pay scale of 37000-67000 with grade pay of 8600, 8700, 8800, 8900 and 10,000, are drawing a monthly salary of around Rs.1,50,000 to Rs. 1,75000. Their pension calculates out to be around Rs. 65000 – 85000.
 
Thus with the retirement of one officers Government saves Rs. 85000 to Rs. 1,15,000 each month. The new recruits are to be employed on initial basic salary in the pay band which calculates to be around Rs. 15600 to Rs.22000  per month. Thus after deployment of two new employees and after paying full pension of the retiree, the Government saves around Rs. 55000 to Rs. 69000 per month against one such employee. For deferment of the retiral benefits even if they are paid interest @ 7% (Banks rate of interest is less than 7%) the interest turns out to be Rs. 15000 to Rs. 20,000 per month. This interest income of the employee shall be taxable so Government shall get increased state share on income tax too. As such by taking into account all facts The Government shall be saving Rs. 40,000 to Rs. 49,000 per month per employee in addition to providing employment to two young persons in his her place.
 
As such by this measure the Government can save the finances, reduce expenditure on salaries drastically and open the doors for employment in case of each category of employees. 

But it has been observed that by this jugglery of figures, by presenting a terrorising state of affairs before the Government by way of fake data and concealment of facts, for serving personal ends anti people decisions are got done from the Government.
 
A concrete example of this misuse and deception is the department of Medical Education and Research, where in by presenting fake figures before the Council of Ministers (Cabinet) and by creating a fear psychosis of the de-recognition of the Colleges by Medical Council of India, the then Director manipulated the creation of such unrequired posts as were not acceptable to the Medical Council of India. Later the Government via notification dated February 2 ,2016, instead of abolishing these unnecessary posts changed the designation of the said posts of Senior Residents to that of Demonstrator/tutor.
 
The doctors who are deployed against such uncalled posts, have to be those who are possessing  MD/MS and are drawing higher salary. Needless to say that as per regulations of Medical council  of India, for the post of Demonstrators /tutors only MBBS doctors are required. (We had hundred of MBBS doctors working in the said colleges already). The Government had to issue a fresh notification changing the designation of these posts which are in Higher grade and are not required at all. The Medical teachers are being re-employed and being paid  the full salary last drawn as well as the pension. This re-employment in majority of the cases is against the purpose mentioned in the official records at the time of framing such a policy. As such in department having a total budget of around 350 crore, and excess unnecessary expenditure has been created to the tune of Rs. 50 to 60 crore. This can be saved after an inquiry.   

The facts about the extension in age of retirement of employees need to be inquired into by an impartial inquiry. The number of Senior Officers (A –Grade) working in the Government of Punjab, as on March 31st, 2013 was 31,108 and the same rose to 32,429 by March 2014. The officers in order to justify the increase in  the retirement age, resorted to many types of tactics and maneuvers. After retirement most of them become irrelevant, lose power and pelf, no body is willing to employee them even on meager salary.
 
Between March 2013 to March 2015 the number of Officers in Grade "B" increased from 46,777 to 55,877. The number of Government and Semi- Government Employees and officers in 2013,2014 and 2015 was as per the table given below:
 

Group

No. of Employees on 

31st March 2013

No. of Employees on 

31st March 2014

No. of Employees on 

31st March 2015

Govt/

Semi Govt

A

31,108

32,379

23,323

Govt.

B

46,777

51,039

55,877

Govt.

C

1,51,776

1,45,764

1,52,392

Govt.

D

50,196

49,691

47,595

Govt.

Contract

36,777

37,404

25,700

Govt.

Total

3,16,629

3,16,377

3,04,887

Govt.

Boards/

Corporations

62,581

63,480

59,987

Semi

Govt.

Municipal

Committees

28,409

28,956

26,653

Semi

Govt.

Panchayat Raj

7693

6938

3266

Semi

Govt.

Market

Committees

3620

3339

3057

Semi

Govt.

GRAND TOTAL

4,19,202

4,19,090

3,97,868

ALL

 

With the increase in age of retirement other benefits too accrue like the earned leave for 30 days, half pay leave of 20 days, casual leave of 20 days, whereas new employee is entitled to 15 days earned leave and 10 days casual leave.

From the above table depicting the number of officers and employees, it is evident that on 31st March 2015 there were 79,200 officers of Grade A & B, and 1,52,392 that of Grade C were in position. By taking 33 years as the average length of service, around 24,000-25,000 officers and employees shall be falling among the ones enjoying extension in service.
 
By adding the ones who have attained 58 years of age the it is estimated that number shall rise to around 30,000. In accordance with the calculations shown above, by employing two new ones in place of each retiree, around 60,000 young persons shall get the job.
 
In addition there shall be a saving of around Rs. 750 crore to the state exchequer. There can be a saving of around Rs. 50 crore in Medical Education and research Department alone. PCMS doctors posted against the newly created posts in excess, in Government Medical Colleges can be transferred to their cadre of PCMS in field, thus the acute shortage of specialists in the field can be reduced. With new recruitment and due to energetic and increased manpower the quality of services shall improve.
 
The savings can be used to solve the problems of the farmers and farm labor. The fiscal deficit shall also come down. But the purpose behind increase in age of retirement and re-employment of retirees is that they keep quiet (shut their mouth) in lieu of greed of Government job.
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