Telangana govt mulls raising retirement age of staff to tide over financial crunch

Time of India

2 days ago

Hyderabad: The Congress govt is seriously considering raising the retirement age of state employees by three to four years from the current 61. This would provide a much-needed relief to the govt as it will not have to pay nearly Rs 5,000 crore in a lump sum as retirement benefits to 10,000 employees retiring in 2025.
Another 9,000 employees will superannuate in 2026. Also, the govt is yet to pay Rs 5,000 crore owed to 9,700 employees who retired in 2024.
The retirement age of state staff was last raised from 58 to 61 by then chief minister K Chandrasekhar Rao-led BRS govt in 2021. In neighbouring Andhra Pradesh, it is 62 years.
The issue came up during a review meeting by chief minister A Revanth Reddy with ministers on Sunday where the demands of govt employees' joint action committee (JAC) was also discussed.
The JAC has submitted its demands to the three-member IAS officers' committee headed by Navin Mittal, which, in turn, submitted its recommendations to the cabinet sub-committee headed by deputy chief minister Bhatti Vikramarka.
Sources said that while some ministers suggested increasing the retirement age by two more years, others proposed four years to make it 65. Bhatti was also present at the meeting.
However, no final decision was taken considering the expected backlash from students and unemployed youth in the state.
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The CM said it would be discussed in the cabinet meeting on June 5 along with the financially intensive and non-financial demands of the JAC, which has threatened to go on strike from June 9 if at least some of their important demands are not met.
The previous BRS govt had faced severe criticism from unemployed youth who had blamed it for lost job opportunities due to the retirement age enhancement.
Also, if the retirement age is indeed raised, the Congress govt will have to grapple with another issue – keep such employees at current pay scales or allow increments every year.
A JAC leader told TOI that pending bills of govt employees and pensioners have mounted to over Rs 10,000 crore, including retirement benefits, and another Rs 5,000 crore would be required by end of this year.
"Enhancing retirement age by just one or two years would not help the govt. It has to be at least three to four years. The average retirement benefits of each employee comes to anywhere between Rs 40 lakh and Rs 50 lakh.
Many who retired in 2024 are still waiting for their retirement benefits. The govt has to take a decision soon," said the JAC leader.
The cabinet meeting on June 5 will also discuss whether to release one or two of the five pending Dearness Allowance of govt employees. The cabinet is expected to give approval for revision of medical treatment rates that were fixed in 2015-16. The govt is also likely to approve non-financial demands of the JAC such as general transfers, sources said.