BLEAK CHANCES OF BANK PENSION RERUN 

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By FROM NITHYA SUBRAMANIAN
  • Published 3.07.00
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New Delhi, July 3 :     The government is unlikely to agree to the demands of bank unions to revive the pension scheme for the employees who had not opted for the scheme earlier. Public sector banks have indicated to the government that they do not have enough money to fund a pension scheme now. Employees could only opt for the contributory provident fund scheme till 1993 - the year in which a pension scheme was introduced in banks in for a brief period. About 50 per cent of the employees had signed up for it at that time. However, unions have been demanding that the employees who could not avail of the pension scheme be given another chance. However, this plea, if granted, would benefit only those who had joined before 1993; those who came in after that year automatically availed of the pension scheme. The government had decided to reconsider the option early this year because it felt a voluntary retirement scheme (VRS) may not be a very attractive proposition for those who had opted for the provident fund scheme. "Unions have been asking for the reintroduction of the pension option either to all employees of public sector banks or at least to those who opt for VRS. This would make the golden handshake scheme more attractive," senior officials in the banking division of the finance ministry said. The government had considered the suggestion earlier, but after consultations with various banks, the finance ministry appears to have accepted the argument put forward by banks that they do not have the money to fund what has clearly been accepted as an 'expensive proposition'. Officials said public sector banks would have to first raise resources to offer a voluntary retirement scheme to prune excess staff and embark on new initiatives in human resource management. This is an expensive proposition for banks as the government is unlikely to provide funds, they added. The government, meanwhile, is planning to institutionalise human resource management in banks. It has recently set up a committee comprising members of the Indian Banks' Association (IBA), finance ministry officials and a few bank chiefs, to chalk out a strategy. The committee, which has already met twice so far, is expected to submit its report by July 15. Banks have also been asked to submit details of their requirements of manpower to the finance ministry. They will base their projections on technological changes, new services and other business parameters. These reports will give the ministry the basis on which to formulate a long-term recruitment plan.