DC Edit | Tamil Nadu Pension: A Bridge Too Far?

When the Tamil Nadu Assured Pension Scheme (TAPS) was unveiled by the DMK government, it turned out to be a New Year bonanza not only for the government employees of the state but for those from other states, too. For, in all likelihood, it would open a Pandora’s Box with other state governments facing a demand for a similar, costly scheme.

Pension, though a British legacy, was one of the attractions of a “government job” besides the permanency it offered in an era of rising employment uncertainty. When the Union government struck down the highly benevolent Old Pension Scheme in 2004, the traditional “government job” lost its sheen. In Tamil Nadu, trade unions did not want to give up on the privilege, at least not completely, and launched a struggle for its restoration.

With the DMK promising restoration of pension benefits in its manifesto for the 2021 Assembly elections and then winning the polls, it became paramount for it to honour that promise. After dragging its feet for four-and-a-half years, the government finally came up with the TAPS, perhaps with an eye on the Assembly election less than six months away. As a social security measure, the pension distinguishes itself since it ensures a definite income for government servants who have dedicated their lives for a public enterprise. So, even if the Old Pension Scheme was not restored in toto, the DMK government did its best to bring back its old glory. The government has not, however, explained how it will make up for the huge financial hit it will deliver to the state exchequer — a one-time pay-out of Rs 13,000 crores and an annual burden of Rs 11,000 crores.

Aside from agreeing to fund the scheme fully, the DMK promised 50 per cent of the last drawn salary as pension, though naysayers rose to nitpick on some aspects. The scheme offers a model, though costly, for other states and an immediate possible demand could arise from the neighbouring Kerala where the ruling front had promised a return to the old pension scheme.