The Hindu : Kelkar proposals

Online edition of India's National Newspaper
Thursday, Jan 02, 2003

Opinion

Opinion - Letters to the Editor

Kelkar proposals

Sir, — Non-pensioners and fixed income people, including retirees from public sector undertakings, have been totally neglected by the Kelkar panel. The situation is already bad for them due to the crash in the interest rates on fixed deposits, including post office saving schemes, and the rise in prices. The increase in the exemption limits up to Rs. 1.5 lakhs does not help senior citizens. For PSU retirees, the Government could consider giving a higher interest rate of 13 per cent (earlier given in P.O.S) at one source, the post office or the SBI, on fixed deposits with a ceiling on the deposit amount on production of identity card or a certificate from the PSU concerned.

T.V. Sitaram,
Chennai

Sir, — In spite of the modifications in Mr. Kelkar's final report, there are serious hidden flaws. For example, a senior citizen having a total income of Rs. 1.77 lakhs from all sources including pension is not liable to pay any tax at present. If the Kelkar recommendations are given effect, he will have to pay a tax of Rs. 5,400 per annum even if the exemption limit is raised to Rs. 1.5 lakhs. A salaried employee, on the other hand, with an income of Rs. 4 lakhs, now paying Rs. 82,000 as tax, will have to pay only Rs. 60,000. Is it fair to rob the hapless senior citizen to fill the pockets of the salaried class in the higher income slab?

V. Nagarajan,
Chennai

Sir, — While discussing the financial security of senior citizens, the problems of pensioners and non-pensioners are clubbed together. But they are classes apart. While pensions increase, interest income is decreasing. For instance, a pensioner who retired in 1980 and whose initial pension was Rs. 1,700 is now drawing more than Rs. 4,000 a month. Whereas a non-pensioner, whose interest income in 1995 was Rs. 4,000, gets only Rs. 2,000 now. Pension is considered as salary and pensioners enjoy general deduction under the IT Act like other salaried employees. Thirty per cent of the pension commuted is restored after 15 years. Unfortunately, the bureaucrats in the Finance Ministry who decide the policies think and decide issues only as future pensioners.

S. Sivaraman,
Srirangam, T.N.

Sir, — The Kelkar report has dealt a severe blow to Central and State Government employees and pensioners as it has recommended the stoppage of dearness allowance, abolition of gratuity and reduction or even abolition of pension to them. Also, any increase in the prices of LPG cylinder and kerosene by removing subsidies will break the backbone of the middle class.

Jagannadha Rao,
Vizianagaram, A.P.

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