The Railways, with its over 15 lakh employees which comprise 40 per cent of the central government staff and 6 per cent of the 2.7-crore organised sector workforce, has decided to give a green signal to the pension reform programme.Senior railway officials said the Railways has held discussions within the organisation, though a formal response to the department of personnel and training is yet to be sent.The government plans to introduce contributory scheme for its employees so that the burgeoning pension burden on the exchequer is eased. As per the distribution of pension outgo in 2000-2001, defence accounted for 50 per cent, Railways 24 per cent, civil 19 per cent, posts 4 per cent and telecom 3 per cent. In all, they accounted for over Rs 21,000 crore or 0.96 per cent of the GDP.Pension expenditure rose nearly six-fold over the nineties. A report on the government’s pensionary liabilities has stated that expenditure on this score rose from Rs 3,272 crore in 1990-91 to Rs 19,446 crore in 1999-2000 and by nearly Rs 1,700 crore in 2000-01 alone. Finance minister Yashwant Sinha in his 2002-03 Budget speech had announced introduction of the contributory scheme from June 1, after the earlier deadline of October 1 last year could not be met.Sources said the Railways wants a representation in a proposed trust expected to be created, once the employees start contributing towards pensions, for monitoring the huge kitty. “Since it is a question of 15 lakh employees’ contribution, we want that they are represented in the trust,” he said.The Railways also wants that if the government plans to open the fund for investment then it should not be in equity. “The investment should be safe so that the pension trust does not go the same way as Unit Trust of India (UTI),” he said, adding that strict monitoring would be required especially since UTI investment was also initially planned to be ‘safe’.A high-level expert group has already recommended a separate authority to oversee three distinct funds for defence, Railways and civil pensions.The official said railway employees were not against the contributing scheme since it would be applicable to new recruits.“A person who gets a job normally does not feel strongly about such issues and will be willing to make contribution towards pension,” another official added.Pension liabilities have become a bane for the Railways since unlike most other departments of the central government it has to set aside money from its revenue for meeting the requirements. It has earmarked Rs 5,990 crore for pensions during 2002-03. In fact, the contributory pension scheme is a welcome move for the Railways since it has been asking the finance ministry to share the burden.The Railways has its own pension fund into which it contributes some sum annually from revenues. On the status of this fund after a new contributory fund is created, an official said, “It will continue to exist till such time all the present employees retire. This could be at least 30 years.” Meanwhile, the department of pensions is unable to make up its mind on the next move till all 15 or so departments turn in their respective responses. With just over a month to go, it is wary of launching a half-baked scheme that may have to undergo extensive amendments later on, officials pointed out.
