TAMIL NADU

Pension for more than five years not viable: report

CHENNAI SEPT. 6. A pension scheme for construction workers is viable only for five years. Any extension will result in a serious financial crisis to the construction board, according to an actuarial report submitted to the Labour department.

The report prepared by Mr. Krishnan, retired executive director, Life Insurance Corporation, said the implementation of the scheme would cause a rush of people in the 50-55 age group to register with the boards. People who now register with the boards are in their mid-30s.

``After eight years, more than 20 lakh workers would have registered and 47,000 workers will be ready to retire. With an annual income of Rs. 12 crores, the board cannot support the scheme,'' said the report.

The pension scheme was announced in the 2003-2004 budget. The minimum monthly pension was set at Rs. 250 and the maximum at Rs. 2,000.

A task force was constituted to examine different schemes.

To sustain a scheme when it is implemented and to augment board revenue, the task force is considering doubling the registration fee to Rs. 50. Consequently, there may be a revision of the renewal fee from Rs. 10 to 25 and a levy of 0.5 per cent instead of 0.3 per cent, according to official sources.

Instead of depending on revenue generated through registrations, cash flow to the board can be improved if it starts collecting cess for Central Government constructions, says R. Geetha, additional secretary, Nirman Mazdoor Panchayat Sangam.

Construction worker unions have also suggested to the State Government that the cess be increased to 2 per cent of the cost of construction.

``All it requires is a small amendment to the State laws. A sizable amount of money can be collected,'' said Ms. Geetha. ``Construction workers need a minimum monthly pension of Rs. 500. The amount the Government has fixed is too little.''

The task force considered extending the `old-age pension' scheme, for destitute agricultural workers, to the construction board. It also evaluated the feasibility of implementing the Life Insurance Corporations's Varistitha Pension Bima Yogana. But both schemes have been dropped.

Recommended for you