After years of wrangling, public sector bank employees are set to get a comprehensive pension benefit.
All employees of public sector banks are likely to be brought under the pension benefit with the implementation of a new wage formula, which is currently under discussion.
At present 2.5 lakh employees who are covered under the provident fund net do not enjoy pension benefits. The move could mean an additional cost of Rs 6,000 crore for state-owned banks.
The managements and trade unions are yet to sort out how the additional burden would be sourced and shared.
A meeting on the issue is scheduled to be held between the Indian Banks Association and the trade unions on Wednesday.
“We are trying to bring all bank employees under the pension net and the management and employees both would be required to share and shoulder the additional burden,” C.H. Venkatachalam, general secretary, All India Bank Employees Association (AIBEA) told p.
Maligned for decades after the government nationalised several banks between 1969 and 1978, public sector banks have since grown in size and branch network.
The employees who were considered high cost and inefficient amid a wave of computerization that spread through the global banking industry in the 1980s are suddenly on strong ground because the balance sheets of Indian public sector banks are looking good in contrast to crisis-hit banking giants of the West.
Employees may get a hike of about 15 per cent or more with all public sector banks standing tall. Most banks have already made a provision for the increased wages. Depending on the size of the banks, the additional outflow due to the increased wages is likely to between Rs 150 crore and Rs 500 crore.
Industry sources said that negotiations on revision of wages have already reached the final stages and an announcement on a settlement may well be made before the general elections.