Kochi: A financial crisis has affected the disbursal of pensions for 59,000 former employees of the Kerala State Electricity Board Ltd (KSEB). For those who retired on May 31, the board distributed the pension benefits only to those who had submitted the required documents before May 19. The board is trying for an overdraft of Rs 275 crore to provide pensions to the remaining 245 people.
Additionally, 1,700 employees are set to retire after six months, which would require the board to find another Rs 680 crore. It has been alleged that the irresponsible handling of the Pension Master Trust pushed the board into a crisis. The Trust was formed to provide pensions and other retirement benefits to employees.
The Board has been disbursing pensions and other benefits from its revenue without augmenting its pension fund. The Master Trust had a pension liability of Rs 12,419 crore. The plan was to raise funds through bonds, and the government and the board contributed 35.4 percent and 64.6 percent of the funds, respectively.
It was also agreed that the government would provide an additional Rs 5,861 crore to provide the retirement benefits of the employees. The government gave approval to the Board to utilise the duty on power appropriated from consumers to provide the benefits. However, the government revoked the duty levied on consumers on November 1, leading to a deficit of Rs 1,000–Rs 1,200 crore, which aggravated the crisis.
The trust will have to find Rs 23,581 crore to provide pensions and retirement benefits. The crisis has put 40,000 pensioners and 19,000 employees under the statutory pension scheme in a quandary. The National Pension Scheme is applicable to those who joined service after 2013. The Master Trust was formed when KSEB became a company in 2013.