Good news! Govt announces pension scheme for 152,000 steel PSU employees

The agreement was reached after detailed consultation with SAIL, RINL, MSTC, FSNL, MECON and KIOCL with Steel Minister

The steel ministry has agreed to introduce a pension scheme for its CPSEs like SAIL and RINL, a move which will benefit about 96,000 serving and 56,000 retired employees.

The pension scheme is estimated to cost additional financial burden of Rs 5.4 billion.

"Ministry of Steel has agreed to the proposal received from various CPSEs under its control to introduce the pension scheme with effect from 1st January 2007 in case of executives and 1st January 2012 in case of non-executives or from a subsequent date as decided by the company," the ministry said in statement.

The agreement was reached after detailed consultation with representatives of employees unions and officers associations belonging to SAIL, RINL, MSTC, FSNL, MECON and KIOCL with Steel Minister Chaudhary Birender Singh.
 

During the meeting with the minister, the representatives of employees unions and officers associations discussed various issues concerning them, including the introduction of pension scheme as part of the superannuation benefits, provident fund, gratuity and medical benefit.

"The minister informed that medical benefits have already been extended to employees of CPSEs under the Ministry of Steel. NMDC and MOIL have also introduced the pension scheme to its employees as per the Second Pay Revision Committee recommendations. He said that there has been a long standing demand from the employees of other CPSEs for introduction of pension scheme," the statement said.
 

Singh said that the pension scheme will benefit over 94,000 serving and 56,000 retired employees of CPSEs under the Ministry of Steel and put an additional financial burden of Rs 450 million per month.

The minister said the pension scheme will be subject to factors like affordability, capacity to pay and sustainability by the CPSEs.

The government budgetary support will not be provided to operate these schemes, the statement said.

"The rate of contribution will be decided by the respective boards of CPSEs each year depending upon the profit made and employee cost to the company subject to upper ceiling of 30 per cent (Basic Pay plus DA) of superannuation benefits," it said.

The actual details of the pension scheme and road map of implementation will be worked out by the management of each CPSEs, the statement said.