Part of a revival package for the State transport utility
The Kerala State Road Transport Corporation (KSRTC) is on the verge of signing an agreement with the Life Insurance Corporation of India (LIC) to pay pension to its retirees.
The utility has 37,000 pensioners, and the payment to them and those retiring from its 30,000-strong workforce in service before April 1, 2013 will become the insurance company’s responsibility.
The scheme is being worked out as part of a revival package to bail the corporation out of a financial crisis with the increase in the price of diesel and monthly revenue-expenditure gap going up to Rs. 93 crore.
The KSRTC will initially provide a corpus to the LIC after the signing of the agreement, for which discussions are on with recognised unions and employees, official sources told The Hindu. A fixed amount will be added to the corpus every year so that the insurance company will be able to take over the pension liabilities in 10 to 12 years.
At present, the corporation needs Rs. 36 crore a month, or Rs. 432 a year, to pay pension. The corporation has provided the details of its retirees, the amount of pension they draw and those on the rolls to the LIC to work out the scheme and fine-tune it.
Those who have joined the utility after April 1, 2013 are joining the contributory pension scheme of the State government.
After taking over the Transport portfolio recently from Aryadan Mohammed, the Minister, Thiruvanchoor Radhakrishnan, held two rounds of discussions with recognised unions to evolve a consensus and take the employees into confidence. The KSRTC management is of the view that handing over the pension payment to the LIC will help the corporation to a certain extent.
In December, the KSRTC limited pension to Rs. 8,500 to each pensioner in view of the financial crisis. The corporation needs Rs. 12 crore to settle the arrears. The utility has not been able to pay the pension in January.