Increase retirement age of central government employees to 62-Sixty two
On 21st March 2013, there was an unstarred question in Rajya Sabha,
about whether there was a proposal to increase the retirement age of
Central government employees. The relevant MOS answered there was no
such proposal. That’s not quite true, because there is such a proposal
floating around and it went to Cabinet sub-committee and an in principle
decision to implement was taken by Department of Personnel and Training
(
DOPT). One should not mix up existence of a proposal with a decision
about implementing it. Evidently, a decision has now been taken to
increase the age from 60 to 62 years, the last time such an increase
took place was in 1998, when there was an increase from 58 to 60 years.
Whenever such a decision is taken, debates centre on the big picture.
What are arguments for? First, life expectancies are increasing. There
is a shortage of good people within government. Let’s tap this
expertise. Second, in any case there are extensions in “exceptional
circumstances”. But that’s arbitrary and can be shot down by the
Appointments Committee of Cabinet (ACC). Why not formalize the system by
allowing extensions to everyone? The trouble with this argument is that
there will be no finality about 62 either and there will be
“exceptional circumstances” beyond 62.
Third, there should be
parity. Professors now retire at 65. High Court judges retire at 62,
Supreme Court judges retire at 65. The counter-arguments of the big
picture are also obvious. India is a young country, young need
employment opportunities. Promotional avenues of existing civil servants
get blocked. Often, in the private sector, people retire at 60 and
there are extensions, with the qualification that extensions are at
consolidated monthly emoluments, with no perks. An increase in
retirement age occurs with all perks. Therefore, there are significant
fiscal costs. While these big picture arguments and counter-arguments
are important, my problem is that such decisions aren’t taken because of
logical coherence. They are ad hoc decisions, driven by myopic motives.
First, increase in retirement age postpones the one-time superannuation
burden of severance payments by around Rs 5000 crores. For a government
that has drawn up red lines on deficit numbers, that’s a desirable
objective, even though it is myopic because it increases fiscal costs on
future governments. Second, there’s a clear political cum electoral
motive. Outright, if we include
Defence, we are talking about 1.5
million Central government employees.
In a broader sense, we are
talking about something like 6 million, excluding State governments and
quasi-government, all urban. This is therefore a significant component
in that 65 million urban household figure. These two points will also be
made when the 62 decision is announced. But the one that bothers me
most is a third element, one that is invariably never talked about. Such
ad hoc decisions are taken because of specific individuals. There is
one particular individual whom government wishes to place in one
particular position. Once he is placed there, government wishes him to
benefit from increase in
retirement age. But to ensure he is placed
there, one needs to ensure those who are senior to him get out of the
way first. After all, supersession is not desirable. Hence, announce the
decision after some people have retired at 60 and exited. This is the
way decisions are taken. At one level, there is no point complaining,
because we have accepted corruption of institutions and systems as fact
of life. But when this 62 decision is announced, as it soon will, let us
not pretend there are any big picture considerations involved.
Source :
www.blogs.economictimes.indiatimes.com[http://blogs.economictimes.indiatimes.com/policypuzzles/entry/increase-in-government-retirement-age-to-62]
