Friday, July 19, 2013

Punjab considering retirement age hike

The Punjab government is considering raising the retirement age of its employees to 60. The proposal is likely to go up before the cabinet on July 23.
The salary, wages and pension bills are eating up a bulk of the state's revenue receipts. The primary motive behind suggesting increasing the superannuation age is containing the fast deteriorating fiscal health, even if temporarily. By the decision, the cash-strapped government hopes to save about Rs. 1,000 crore a year.

If the retirement age is not increased, the government has to release post-retirement benefits running into multiple-crore rupees a year. "The increase proposal is under active consideration of the government," a top government source has confirmed. The finance department has cleared the proposal after consent from deputy chief minister Sukhbir Singh Badal and finance minister Parminder Singh Dhindsa.
The lukewarm response from the employees to the government's decision in September 2012 to offer a year's reemployment to all people retiring at the age of 58 has necessitated the move to up the age to 60 on union government the pattern.
In September 2012, the government had declined the finance department proposal to increase the retirement age from 58 to 60. Many employees, however, did not take the re-employment option and the government's hope of saving about Rs. 1,000 crore was dashed.
The fiscal health is so precarious that every month, the government battles the overdraft problem. It borrows from market to meet its committed liabilities such as salary and pension, while the employees await long overdue instalments of dearness allowance (DA).

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