Letter forwarded by V R Krishna Iyer to Finance Minister

C N Venugopalan Ex-Manager, Union Bank of India	Nandanam Kesari Junction, N Parvoor, Kerala – 683 513
Phone. 0484 2447994 Mob: 9447747994 E-Mail: ceeyenvee@gmail.com

No.20100622 22^nd June, 2010

Justice Mr. V R Krishna Iyer,

Former Justice, Supreme Court of India,

Ernakulam

Most Respected Sir,

Sub: Pension Option to Bank Employees

On 27^th November, 2009, Indian Banks' Association signed an agreement with Unions in Banking Industry to extend a fresh Option for Pension to bank employees, working and retired, who could not opt for it in 1995 because of a penal clause in the Pension Regulations which was later deleted in February, 1999.

While the agreement seeks to remove the anomaly of not granting pension, a fresh set of anomalies are engendered in it, making it a dark and sully one not conforming to any standard. Anomalies are mainly the following:

1. It envisages to recover from the retired (prior to 27 11 2009) the CPF and interest on it paid to them at the time of retirement along with another 56 percent of the amount i.e. total 156 percent. An employee who retired in 2000 who has enjoyed the benefit of retention of the money and another retired in October 2009 who has just received the money have to pay the same penalty of 56 percent for gaining entry into the scheme. This lacks fairness entirely.

2. The agreement provides for payment of Pension from its date of signing (without retrospective effect from date of retirement). An employee who retired in 2000 will stand to lose his pension from date of retirement to the arbitrary date of 27 November, 2009 which is a gross anomaly. The precedence has been that in the Pension Scheme commissioned in 1995, those retired from 01 01 1986 were given coverage. Through this, banks seek to meet establishment costs at the expense of the retired employees and out of their pension which is altogether a shame on the part of banks, Financial Sector and of the Government.

3. As per another term of the agreement, those in service who now opt will have to pay 2.8 times of their November, 2007 Basic Pay as their contribution to Pension Fund for becoming its members whereas no such levy was there to their counterparts.

4. The agreement provides for granting commutation, on the basis of the age as on the date of option instead of the age at the time of retirement. This goes to deprive the pensioner a substantial portion of the commutation of pension.

5. The agreement fails to recognize the eligibility to pension of the resigned employees who possess the requisite qualifying service. They are people who went out on their own for personal reasons as banks denied them voluntary retirement under their special scheme. While the latter who were paid incentives for going out are considered for pension, denying pension to the resigned is a gross injustice.

6. Recovery of the CPF and interest itself is not justified since Allahabad Bank, a state run bank pays to its employees three retirement benefits viz. Gratuity, Pension and CPF. Separate yard sticks are adopted for compensation in SBI, Allahabad Bank vis-à-vis other public sector banks flouting all legal etiquettes in the key industry of the nation.

7. Pension Payment in banks is under one and the same "Pension Regulations" The provisions of the agreement to impose unwarranted curbs and penalties on one segment, while all the benefits have been given to the counterparts in full, offend substantive law and ought to be scrapped.

The agreement prima facie lacks all fairness and cuts a low profile philosophy of its architects. Its effects are far reaching as it catapults all norms of law and justice, Constitutional doctrines. It causes a shame on the nation as it seeks to snatch away a major chunk of the pittance payable to the retired employees for running the state owned banks. The legal system of the nation that is saddled with heaps of suits which will also be affected badly through a huge influx of petitions, if the anomalies are not rectified forthwith

The agreement signed on 27^th November, 2009 is yet to be implemented adding to the misery of those who retired a decade back and the situation calls for speedy implementation. I earnestly solicit your kind intervention through addressing a suitable letter to Shri. P K Mukherjee, Hon'ble Finance Minister of India requesting him to render justice to the deprived who are suffering for more than a decade.

Thanking You, I remain.

Yours sincerely.

C N Venugopalan

Evaluate the Fantastic Contribution to Banking System

C N Venugopalan Ex-Manager, Union Bank of India	Nandanam Kesari Junction, N Paravoor, Kerala – 683 513
Phone. 0484 2447994 Mob: 9447747994 E-Mail: ceeyenvee@gmail.com

No.20100511 (a) 11^th May, 2010

The Principal Secretary, Office of the Prime Minister, Government of India, New Delhi – 110 001

Kind Personal Attention: Shri. T K A Nair,

Dear Sir,

EVALUATE THE FANTASTIC CONTRIBUTION TO BANKING SYSTEM -HAS ANY ONE MADE IDENTICAL CONTRIBUTION TO FINANCIAL SECTOR IN HISTORY?

Seventeen listed PSBs made incremental profits of 22,502 Crores over 2006 during the three ensuing years. During 2003 -2006 the Chairmen of different banks fought themselves ignoring national goals for their own cosmetics, pulling the legs of one another most unethically using the deregulated interest rates, allowing interest concessions up to 6 percent to potent borrowers.

When IBA said, banks did not have financial muscles to bear the burden of fresh Pension Option, I criticized them and pointed out the process of debilitating of the Banks by those who are to strengthen them. In 2006 August, the lethal interest rate war and take over mania almost came to an end. I mooted vehement criticism to RBI, MOF etc. saying that "thanks to the efficient monitoring of Banks by RBI by keeping their men as directors on board the different banks, even a PSB viz. New Bank of India vanished into obscurity; RBI changed the nomenclature of their director as "Nominee Director". The change was announced by CNBC Channel in August, 2006.

The take over of accounts offering lesser rates of interest stopped almost as a result of my efforts. The stoppage of the interest rate war resulted in soaring profits for all Banks in Public and Private Sector. The incremental Profits over the year 2006 for the next three years for 17 listed PSBs were to the tune of Rs.23,670.00 Crores. SBI, Associate Banks and Private Sector Banks too must have made incremental profits totaling double of the amount for the 17 Banks. It is after contributing to the Indian Banking system about Rs.70,000 Crores that I pressed the demand for Pension Option. The actuarial assessment of the deficit in Pension Fund was Rs.6,000 Crores, i.e. just 10 percent of the incremental profits of the three years.

Profits of Eighteen listed Public Sector Banks in India (excepting banks that are not listed) during the past five years:

	March	March	March	March	March
	2005	2006	2007	2008	2009
Punjab National Bank	2707.21	2874.77	3230.64	4006.24	5744.35
Bank of India	340.05	701.44	1123.17	2009.4	3007.35
Union Bank of India	719.06	675.16	845.39	1387.03	1726.55
Central Bank of India	357.41	257.42	498.01	550.16	571.24
Canara Bank	1109.51	1343.22	1420.81	1565.01	2072.42
Indian Overseas Bank	651.36	783.34	1008.43	1202.34	1325.79
UCO Bank	345.65	196.65	316.1	412.16	557.72
Syndicate Bank	402.90	536.50	716.05	848.06	912.82
Allahabad Bank	541.79	706.13	750.14	974.74	768.6
Vijaya Bank	380.57	126.88	331.34	361.28	262.48
Bank of Maharashtra	177.12	50.79	271.84	328.39	375.17
Corporation Bank	402.16	444.46	536.15	734.99	892.77
Indian Bank	408.49	504.48	759.77	1008.74	1245.32
Dena Bank	61.00	72.99	201.56	359.79	422.66
Bank of Baroda	676.84	826.96	1026.47	1435.52	2227.2
Andhra bank	520.1	485.5	537.9	575.57	653.05
Oriental Bank of Commerce	760.81	803.16	826.81	840.94	905.42
Total	10562.03	11389.85	14400.58	18600.36	23670.91
Profit above March 2006 level (Incremental Profit)			3010.73	7210.51	12281.06
Total Profit hike for all the three years					22502.30

The Loan waiver for helping farmers in difficulties in the pre-election period was Rs.70,000/- Crores. Benefits mostly went to willful defaulters with ample means. Decision makers were bank managers who extended on the basis of status of the account and as per their whims within the limited time frame. The normal loan waiver for the past three years by banks was to the extent of Rs.25,000 Crores. While banks could easily accommodate Rs.95,000 Crores on write off, banks were pleading paucity of funds to meet the Pension burden in spite of the progressive and cumulative Net Profit figures. A major portion of the incremental profits of Rs.70,000 Crores can be reasonably attributed to my work as the take over mania of banks and unethical competition by using the lethal weapon of reduced interest rate stopped almost as a result of my criticisms put forth. Any one may evaluate whether any individual has made such a fantastic contribution to the Banks and Financial Sector of the country without taking any remuneration or compensation, while those responsible for strengthening banks were fighting with each other and debilitating the Banks. The actuarial deficit of Rs.6000 Crores in Pension Fund was a mere statistical gimmick, a product of those who were paid for it by Banks.

It is only after strengthening the banks and the banking system of the country so much that I made the demand for a fresh Pension Option which meets with the aspirations of our Great Prime Minister from legal and socio economic angle. My work is resulting in redeeming the deprived social security benefit to more than five lakhs Indian families from the banking community, presently working as also the retired who are in utter financial distress. It is my belief that you will kindly appreciate it as the most laudable achievement of an individual - a Keralite - at least in the first decade of the century benefiting a vast number of families in India as I have been fighting relentlessly for it single handed for past nine years.

Thanks and Regards

Yours faithfully,

C N Venugopalan

Letter to Chartered Accountants Institute

C N Venugopalan Ex- Manager, Union Bank of India & Financial Consultant	“ Nandanam” Kesari Junction North Paravoor Kerala – 683 513
Phone No. 0484 2447994 Mobile: 9447747994

The Director, 18^th October, 2006

Institute of Chartered Accountants of India,

ICAI Secretariat,

C-1 Sector –I, Noida – 201 301 Attn.: Mr. Vijai Kapoor

New Delhi

Dear Sir,

Significant Accounting Policies & Banks –

Publication of wrong working results

I had sent to you a letter dated 13^th May, 2006 on the captioned subject which the institute neither acknowledged nor replied in time. On enquiring the status of the letter, the CPIO of the institute informed me through his letter No. ICAI RTIA CPIO: 67:06 dated 13^th October, 2006 that it “has been responded vide Institute’s letter dated 11^th September, 2006 (Copy enclosed).” I had not at all received a letter bearing date 11^th September, 2006 from the institute till now. However, on going through the enclosure, I found a letter dated 11^th October, 2006 which bore no reference number at all. I have not received the original of the said letter, which appears as having been addressed to me. The institute has sent to me a copy of this letter even without my alleging its non receipt as if it was aware of the situation. The absence of any letter reference number in it also is intriguing. The letter No. CPIO 67:06 dated 13^th October, 2006 is seen dispatched swiftly by Speed Post on the very same day to me. As a safety measure and abundant precaution, you have stated in your letter sans any reference number that my letter dated 13^th May, 2006 has been received by you only on 6^th October, 2006 i.e. after a delay of about four months. The institute is in no way accountable to me and it was well entitled to return my letter in May, 2006 itself without sleeping over it, if the matter detailed in it was not pertinent to you. All the things taken together make the whole thing really enigmatic.

You have rightly stated in your letter that the Institute is a statutory body set up under an Act of the Parliament for regulating the profession of accountancy and it evolves guidelines and standards which are intimated to the members for observing compliance with the norms. The standards evolved are from the knowledge we acquire day by day. The norms prevalent some ten years back are replaced by fresh norms in keeping with time and requirements of the situation. It is the same belief that made me think that it would be worthwhile to bring to your notice the need for evolving fresh norms because of non-provision / non payment of establishment expenses that are contingent liabilities. Non-provision /non payment of Pension results in inflation of Profits as also conversion of establishment expenses into profits. Public also get deceived on account of the high stock prices prevailing in the market because of the inflated profits banks show in the financial statements. The situation has prevailed for last ten years or so. My sincere feeling was that the Institute would take up the matters with the Indian Banks Association and RBI, if not with Individual Banks.

Now I perceive that even statutory bodies are propelled by bureaucracy in our country and one has to be surprised only if the due sanctity is assigned to matters. Though the country is nearing the diamond jubilee year of independence, the citizens get justice and fair play only in their grave yard.

With regards,

Yours faithfully,

C N Venugopalan

cc.to: Dr. V. Seshadri, CPIO, ICAI, P B NO. 7100, Indraprastha Marg,

New Delhi – 110 002 for Information.

Letter to C H Venkitachalam 29 Feb. 2008

C N Venugopalan Ex- Manager, Union Bank of India & Vice President, Union Bank of India Retired Officers’ Association (Kerala)		“ Nandanam” Kesari Junction North Paravoor Kerala – 683 513
Phone No. 0484 2447994 Mobile: 9447747994 e-mail: ceeyenvee@gmail.com
CNV 108/2007	29th February, 2008

Com. C H Venkitachalam,

41 B Singapore Plaza, 3^rd floor,

164 Linghy Chetty Street,

Chennai- 600 001

Dear Comrade,

ONE WHO IS NOT ASLEEP CAN NOT BE AWAKENED

Yes. We can awaken one only if one is asleep. We can not awaken one who pretends to sleep. This is the case with the Bankers, Trade Union leaders and the Government when we approach the issue of second option on pension to the Bank employee. There are several things that form the feathers to the cap of Trade Union leaders who are dealing with the issue of Pension Option. Those who find a place among the segment that have the option are acting as black sheep and take a piggy ride on the shoulders of their counterparts who happened to be in the other segment. This is the only reason why second option has not materialized so far. Since people like you are aware of the entire gamut of things, there is absolutely no point in attempting to awaken you in the matter. Yet it is considered worthwhile to list the absurdities that arose in the banking industry in the past two decades.

Pension Regulations got amended in February, 1999 when the clause enabling managements to forfeit the past services of an employee for participation in strike was scrapped. Did it bring any benefit to anybody other than to the Trade Unions by upholding the right to conduct agitations? The amendment vested a legal right to those who could not earlier for Pension because of the existence of the deleted clause in the Regulations. This right of the employee was corollary of the amendment and the plight is that no trade union in the country made any attempt to secure the legal right of the Bank Employee. The amendment proved to be a undehusked coconut to a dog. The definition of Trade Unions appears as having undergone radical changes and the function appears to be betraying the members by pulling the legs of the counterparts. The irony is that the surpluses generated by the industry goes to pay pension to the statesmen who sit in the Assembly or Parliament for a short term of even two years and to the Government servants whose work is not directly related to any profitability.

Trade Unions have been functioning with prime focus on the welfare of the leaders only. Ensuring Pension to a trade union leader was the only objective of the retrospective effect from 01 01 1986 to the Penison Scheme that was commissioned in 1995. You may feel free to let me know other significance, if any, of the date 01 01 1986. The Bank Unions that collect about Rs.15 Crores as subscription every month from the members and derive the entire strength from the members prove themselves to be a utterly useless blanket that fails to shield them against chill when they fail to secure their legitimate and legal right to pension in its original form as extended earlier. They appear as discussing alternatives at a time hen Banks are posing fantastic profits and squandering money on unwanted items like change of logo. Unions miserably failed to safeguard the interest of the serving members and proved that unions are for leaders only.

The Pension Scheme guarantees Pension to those who have joined banks subsequent to its commissioning and also those who are yet to join the industry. It extended coverage to all those who retired prior to its commissioning also. All those who retired on or after 01 01 1986 are given the benefit. Those who retired prior to 01 01 1986 are also given an ex-gratia every month. But it denies Pension to those who are still serving is spite of sacrificing their CPF share, though the amendment to Pension Regulations in February, 1999 vested with them a right to Pension Option afresh. During the period from February, 1999 to March, 2006, the issue of Pension option was a dead one. No Union had any concern over it. The item got rekindled only after I issued a circular letter to the comrades highlighting the grave irregularity.

The plight of the bank employees who pay monthly subscription of about Rs.15 Crores every month is that the veteran leaders shut their eyes in front of any anomaly that the managements perpetrate. Banks have money to squander on unwanted items and unsound policies. They lack money only for compensating labour properly. They extend the benefit of write off to the borrowers who come to the banks for a short span and borrow money and default repayments. The Government is urging Banks to grant interest free loans to sugar mills. Now Rs.65,000 Crores is being set apart for write off of Agricultural loans, eyeing the forthcoming elections. Banks don’t have money to pay pension to the retired employee who spent his entire career with them and made what they are. The key men of banks were during 2004 - 2006 unscrupulously pulling the legs of each other to snatch away the borrowal accounts from one another by using reduced interest rate as the weapon. The life blood of the system was oozing out like anything and the loss the banking system sustained for the cosmetics of the Chairmen knows no bounds. This damaging situation got checked only in August, 2006 as a result of the vehement criticisms I leveled against banks and sent to various quarters during the period from April, 2006 to August, 2006. Now banks are after change of logos that have stood the test of time and brought progress and glory to them to please the political masters by awarding the work worth several Crores of Rupees to those in their close quarters. Unions close their eyes before the extravaganza and divert attention to issues like mergers.

Payment of pension by Banks was not as per the Pension Scheme. Banks started paying superannuation Pension in the case of those who retired Voluntarily in the year 2001 from the ensuing month of their retirement, notwithstanding the fact that Pension was payable to an employees only after attaining the age of 60. The pension so paid was outside the scope of the Pension Regulations and had no enabling provision in the Scheme. Regulation 28 was subsequently amended on 13 07 2002 through Gazette Notification stating that “Superannuation Pension shall be granted to an employee who has retired on his attaining the age of superannuation specified in the Service regulations or Settlements. Provided that , with effect from 1^st day of September, 2000, pension shall also be granted to an employee who opts to retire before attaining the age of superannuation , but after rendering service for a minimum period of 15 years in terms of any scheme that may be framed for such purpose by the Board with the approval of the Government.” When versatile managements commit mistakes and throw away money, they become more versatile and ratify such mistakes by amending the Regulations to escape the accountability.

The elephants walk behind the mahout without knowing its power. Mahouts make them gullible and take advantage of the ignorant animals. Some of them work as tamers and help mahouts betray other animals. Bank unions are no exception. Among the elephants, there are black sheep that betray their own folks, and work as tamers. The leaders who secure comfortable postings at their own places and several other privileges with the power derived from the members and eat the garbage the managements give them after chewing will naturally have to clap their hands when managements perform absurdities and deceive the workforce.

The Apex acknowledged Pension as deferred wages and the right of an employee akin to Fundamental Rights the constitution has guaranteed and not as a charity doled out to retired employee at the sweet will and pleasure of the employer. The amendment to Pension Regulations in 1999 vested with employees a legal right to second option. Banks are now posing fantastic working results and have ample money to be extravagant in spending. In SBI, Pension is given as a third benefit, creating a premier segment among identical people doing the same work, in gross violation of the provisions of the Constitution of India and in breach of the principles of equity and equality. In Reserve bank of India, fresh option was given in the year 2000. When all bank men are entitled to Pension in its original form, leaders of Bank Unions are joining hands with the managements and undertaking reconciliation of actuarial aspects to consider whether to grant second option on Pension.

March, 2007 repeated in February, 2008. The assurance to consider the proposal and to finally settle the issue before June, 2007 vanished into obscurity. The strike proposed on 25 and 26 February, 2008 was deferred without any categorical assurance on the Pension issue. The advice of Shakespeare, “Trust not him that hath once broken faith” is once again ignored, as some unions were once again pledging the interests of the members who power the leaders. If the bank trade unions are worth their names, they should join hands and accomplish the legitimate right and entitlement of Pension in its original form as extended earlier to all those who were on the rolls of banks in February, 1999, whether working or retired subsequently. The only alternative to them is to dip the banners in the Arabian sea or Bay of Bengal, clad themselves in saffron clothes and go on pilgrimage for ever.

It is my sincere desire that you will continue to strive to be worthy of the position and secure the benefit for the members who are now deprived of he benefit of Pension

With regards, I remain.

Yours comradely,

C N Venugopal