Finally the ruling Congress party and the main opposition Party BJP joined together and passed the Pension Fund Regulatory and Development Authority (PFRDA) Bill in the Parliament. In the year 1982 on 17th December, the Constitution Bench of the Supreme Court consisting of Justice (s) Y. B. Chandrachud, V. D. Tulzapurkar, O. Chinnappa Reddy. D. A. Desai and Bahrul Islam delivered the historic judgment on pension in the D. S. Nakara case, which declared as follows:
“(i) Pension is neither a bounty nor a matter of grace depending upon the sweet will of the employer and it is Fundamental right (ii) Pension is not an ex-gratia payment, but it is payment for past service rendered (iii) It is a social welfare measure rendering socio-economic justice to those who in the heyday of their life ceaselessly toiled for the employer on an assurance that in their old age they would not be left in lurch.”
After 30 years, the bill passed by Parliament categorically proclaims that the Contributory Pension Scheme introduced w.e.f 01.01.2004 will not give any guarantee for a minimum pension of 50% of the pay drawn at the time of retirement of the employee. Nor does it provide for the protection of the family members in the form of family pension in the event of death. New pension is going to make the social security uncertain and dependent on market forces. Government compulsorily imposed the scheme on one section of the employees in a most discriminatory manner, inspite of the fact that such scheme had been a failure in many countries including Chile, U K and even in USA. In USA the entire pension wealth (fund) has been wiped out leaving no pension due to the economic recession and share market crash. In Argentine the contributory scheme which was introduced at the instance of IMF was replaced with the defined benefit pension scheme. In majority of the countries “pay as you go” is the system of pension.
