Faced with empty coffers and a Central government that is withholding the arrears due to the State, the Tamil Nadu government, on May 7, decided to increase the retirement age of its staff from 58 and 59. The move will affect all its employees, school and college teachers and PSU workers.
“This is merely postponing a financial commitment to a later date. This is another innovative way of managing the resource constraint in the State like it has done with the transport workers for quite some time,” said Prof. J. Jeyaranjan, Director, Institute for Development Alternative. “Out of the main revenue mobilisation avenues, three are not bringing in any revenue. The fourth, liquor sales, has just begun today with so many riders,” he said.
At the time of retirement, an employee is entitled to get death-cum-retirement- gratuity (DCRG), a lump sum that is given to the retiree or his family once he or she superannuates. According to one source, this method will not save too much money, only about Rs.1,200 crore, but it was imperative to keep the government afloat. According to one estimate, in the years 2020, 2021 and 2022 taken together, 20 per cent of the government staff would have retired had the retirement age been 58.
“This shows how bad the state of finances in Tamil Nadu is,” says Peter Alphonse, Congress leader. “This is nothing but a distress sale. Only Central government can help in the present crisis. Only if all Chief Ministers come together, they can bargain. But even that is not happening,” he said.
This is not the only cost-saving measure by the State. On April 27, the government announced the suspension of earned leave facility that was available to staff and teachers. “In view of the financial stress arising from the COVID-19 pandemic, the periodic surrender of earned leave for encashment for 15 days every year/30 days every two years… is suspended initially for a period of one year to all the government employees and teachers,” the order dated April 27, 2020 (G.O. Ms. No. 48 of the Personnel and Administrative Reforms (FR – III) Department) said.
Alhough the government announced a 10 per cent incentive for government staff who work on the frontlines to control the pandemic, a government order to this effect is yet to be issued.
“This is not a cost-cutting measure, this is an employment cutting measure,” said Kanagaraj, CPI(M ) leader. “Already the Railways is giving contract employment for retirees. This is happening at a time when unemployment is the highest in the past 45 years. This has the potential to create social upheavals,” he said.