The Shehbaz government, not without prodding from the IMF, has put its hand in the hornets’ nest, and gone for a number of pension reforms. These have not been meant to bring the pension system up to date, which should be the real reason for any reform, but so as to save money. As government servants mostly do not have trade unions, there was no formal input from those who would be affected. The problem with pension reform is that it is an emotive issue, not merely a matter of rupees and paisas. One of the prime attractions of government service is that it is a ‘pensionable job.’ It is something of an island in a job market where the private sector enterprises have not developed pension schemes of their own, and where trade unions have not developed pension funds of their own. It might well be noted that the recent student protests in Bangladesh, which toppled an apparently well-entrenched government, was over quotas in government jobs.
One of the most explosive changes is going to be the reduction of the pension by up to 20 percent if the government employee chooses to retire before reaching the age of 60, but after qualifying after 25 years of service. This seems to contradict the offer of a golden handshake to those government employees who will be rendered surplus by the proposed downsizing of various departments, and the abolition of some. If pensions are reduced, when employees do their math, they might come to the conclusion that the game will not be worth the candle, and they would do better to remain in service for as long as possible. After all, the purpose of a golden handshake is to persuade the employee that with the capital sum he will get, he will be able to replace the benefits he will be forgoing by leaving service early, including the pension benefit.
This is not meant to exonerate government servants from having been guilty of dereliction of duty. They have not served the state as it deserved, and most notably, they did not avoid corruption if they could help it. The concept of the government pensioner eking out a bare existence, subsisting on a meagre pension, is perhaps outdated. Of course, it might still apply to those who were unlucky enough to land up in a department with no opportunities, but the pity is that they are being made to suffer for the hay made by others while the sun shone.
