Hyderabad: The Telangana state finance department has opposed the extension of retirement age from 58 years to 60 years.
Sources in the CMO said the finance department has put its foot down on the proposal, as it would entail an additional financial burden on the state exchequer and a denial of opportunity to unemployed educated youths.
The related file was sent by the department to Chief Minister for his final decision.
Officials said if the retirement age is increased, the government has to pay high-end salaries to about 6,000 employees every month. If the government takes freshers in their place, the salary bill will come down by 50 per cent.
On an average, about 6,000 employees of various categories are retiring every year. After retirement, the state government has to pay about Rs 40 lakh to each employee by way of retirement benefit.
The state government has recently noted that every year it has to pay about Rs 2,400 crore as retirement benefits to those who are retiring. If they will continue in service for further two years, there will be no additional financial burden on the exchequer since the government does not have to pay the retirement benefits for at least for two years.
But, the finance department said if they will continue in service for a further two years, the state government has to pay 6 per cent more of the total retirement benefits they will get at present. It will come around Rs 144 crore.
That means the financial burden on the state government will increase from Rs 2,400 crore to around Rs 2,544 crore. The finance department’s argument is that, at present, the employees who are set for retirement are getting higher salaries as they had got several promotions between the periods of their joining till retirement. For 6,000 employees, the state government is paying around Rs 432 crore per year as salary.
By recruiting new persons in those 6,000 vacancies, the government has to pay about half that amount as salaries.
The officials said the old employees cannot change their workstyle whereas new employees will follow the computerised systems. CMO officials said the file relating to increasing the retirement age of government employees is with the CM.
