E-pension refers to disbursement of pension through electronic means. We discuss a case study of Himachal Pradesh as
E-PENSION in Himachal Pradesh
ePension application is the result of major process re-engineering by the Government of Himachal Pradesh, Department of Finance, Treasury Accounts and Lotteries benefiting senior citizens. It involves complete change in the pension
disbursement system for HP Government pensioners. The web interface enables the HP Government pensioners to know the status and details of their monthly pension through Internet where complete pension detail for the last 12 months is available.
Pension forms being submitted by the retiring Government servants were modified in consultation with the AG-HP.
OLD SYSTEM OF DISBURSEMENT OF PENSION
The state government pensioners in the state were getting their pension through treasuries and banks as per the options exercised by the pensioners. The system of payment of pension to the state government pensioners prior to 2006 (termed as old
system hereinafter) utilized the reach of banks as bank branches are present through out, even in remotest of the locations in the state.
In old system, pensioners had the option to draw pension from any PDA (i.e. Pension Disbursing Agency).The PDAs were either the authorized banks branches or the treasuries. The PPOs in respect of all classes of pensioners were received from Pension
Authorizing Agency i.e. the AG in district treasuries. Registers (TR 36) were being maintained in district treasuries, in which most of the information contained in the PPO was entered manually. After this the PPOs were sent to the PDAs. The pension payment
to the pensioners on the basis of authorization in the PPO was the responsibility of the PDA. There was no intervention of treasury in the pension payment. District treasuries entered the paid pension vouchers in the accounts.
There were three systems of pension payment in the state.
1. Payment by banks: In this system, the pensioners opened accounts in bank branches of seven banks (SBI,SBoP,UCO,PNB,UBI,CBI,BoI) authorized for pension payment. Pensioner’s pension accounts were credited by the branches on 1st of every month on the basis of entitlements authorized in the PPO. Pensioners were not required to visit banks for getting pension. Calculation of entitlements was responsibility of paying branch.
2. Payment by banking treasuries: In banking treasuries separate bills for each pensioner used to be prepared and passed by treasury. Passed bills were then given to the pensioners who would then present these bills at the bank branch attached to the treasury
for getting payment.
3. Payment by non-banking treasuries: In non – banking treasuries separate bills for each pensioner used to be prepared and passed. Cash was also disbursed to pensioners on the basis of passed bills at the treasury.
In the latter two systems, bills for each pensioner were prepared and personal monthly appearance of pensioner in treasuries was mandatory.
MAJOR PROBLEMS IN OLD SYSTEM
1. Number of pensioners was quite large (approximately 75000 in 2006) and was increasing at the rate of around 2500 pensioners per year. Also all the documents were routed through District Treasury. Both these reasons lead to increase in work load. Manual system in Treasuries added to the problems because it was not only prone to errors and time consuming but was out of tune in the age of e-Governance. Huge data was difficult to maintain. In the absence of properly maintained records over/under payment were being done and it was difficult to detect such cases.
2. There are a lot of wrong payments made by the PDA e.g.
(i) Restoration of pension (commuted portion) was not being done in time.
(ii) A lot of pensioners continued to draw their pension on un-revised rates.
(iii) Necessary certificates were not taken as a result of which pension accounts continued to be credited even after death of pensioner/family pensioner.
(iv) Banks did not make Life Time Arrears payments in case of death of the pensioners.
(v) Banks official, in many cases, were not able to calculate entitlements properly leading to overpayments or underpayments.
(vi) Many a times, DA was not given at proper rate. DA and arrear on DA were delayed by bank branches because of none availability of Government instructions.
(vii) Re-employed pensioners were getting full pension whereas they were entitled to basic pension only.
3. No entry was being made in the PPO regarding pension paid to the pensioner which was the mandatory provision of the Public Sector Bank Scheme notified by the Government.
4. All the cases of over/under payments caused a lot of harassment to pensioners. Recoveries were not affected by banks. If recoveries were made, accounting of recoveries was not being done. Sometimes banks affected recoveries by
way of short drawls. Recovered amount by this method remained unaccounted in almost all the cases.
5. In the case of pensioners who served during Punjab time, some portion of pensionary liability is allocated to the Punjab. Such allocations are reimbursed by Punjab. Banks in most of the cases unaware of accounting procedure kept
whole amount in HP allocation. Thus, the State Government incurred recurring losses on account of wrong allocation.
6. There was no uniformity in the system of pension payment as there were three systems of pension disbursement in state. It was not possible to compile any information and retrieval of data was almost impossible.
7. Pensioners had a lot of grievances and banks were not in a position to redress grievances due to lack of knowledge of pension rules. Redressal was time consuming and tedious as pension records were with banks.
THE COMPUTERISED SYSTEM : e-Pension
In order to remove all the problems mentioned above pension disbursement was computerized through the e-pension system. The pilot run of the system was done successfully in one of the twelve districts of the state. In 2006 , complete rollout of the system was done. Major features of e-pension are:
1. In e-pension, option given to pensioners to draw their pension from treasuries was withdrawn. All pensioners drawing pension from treasuries were shifted to the banks.
2. More banks were authorized for pension payment through out the state. All pensioners shifted from treasuries opened accounts in authorized bank branches.
3. PPOs received from the AG are not sent to the PDAs but are retained in the district treasuries.
4.The data base in the form of PDA-Master and PPO Master was created at the District Treasuries. Detailed entry of approximately 75000 PPO was done in-house by the officials of the department.
5. PDA-Master is the list of designated bank branches in the District which are disbursing pension to HP Pensioners. This list is
maintained/updated centrally at shimla.
6. PPO Master file is the data base of all pensioners in the District containing all the relevant information required for pension payment. The PPO Master is created and updated at District Treasuries on the basis of PPOs received from the AG.
7. All the PPO files of pensioners being maintained at different banks were recalled at the concerned District Treasuries.
8. On the basis of PPO Master created in the District Treasuries, Bank branch wise monthly pension payment scroll is generated for all branches in district. Thus the responsibility of pension processing and calculation has now shifted to treasuries. The scroll is sent to the link bank branch of the district by 23rd of the preceding month in advance.
9. The branch wise pension payment scrolls are then sent to the paying branches of the district by the link branch for crediting pensioner’s accounts strictly as per the scroll sent by district treasuries. All the PDAs in the state
have now been converted from active PDAs, calculating/processing pension to passive PDAs , making pension payment on the basis of scroll of the district treasuries.
10. After crediting bank accounts of the pensioners, paying branches return the scroll through link branches to district treasuries for entering into the accounts.
11. All the necessary certificates continue to be taken by bank branches. These are then sent to District Treasury along with scrolls.
12. Pensioners of other states drawing pension in treasuries were also shifted to bank branches located at the place from where they were taking pension through Treasuries.
13. The scroll generated by District Treasury was initially sent to the banks in triplicate. Triplicate copy of scroll was retained by the branch. Paying branches returned payment scroll in duplicate in the form of paid vouchers to link branch which retained duplicate copy. Original copy was sent to District Treasury for accounting purpose. Later the soft copy of scroll was started through which banks upload payment data directly into their CBS platform thereby crediting pension accounts of beneficiaries.
14. Pension forms being submitted to the AG by the retiring government employees were modified by making it mandatory to enter bank account and bank branch details.
BENEFITS OF e_PENSION
The e-pension system took care of all the shortcomings of manual system of pension disbursement. The benefits of the e-Pension are as under:-
1. Every state pensioner is getting pension through some bank branch. No cash disbursal from Treasuries and Banks don’t process pension
2. Calculation of pension entitlement amounts at District Treasury beforehand
3. More local banks involved for pension distribution
4.Instant Revision of Pension in all District Treasuries in case of grant of DA other arrears, DA merger, pension revision etc.
5. The pensioners can know details of pension (break-up in terms of basic, DP, DA, arrears-if any, recoveries- if any, net pension)
6. Web Interface for Pensioners at https://himachal.nic.in/ePension
7. Through web-interface pensioner can see pension for the last 12-months and get print out for Income Tax return filing purposes.
8. Efficient & fast Grievance Redressal through DTO by Email
9. Recovery of huge amounts on account of pre-1966 pension and over-payments on account of wrong payment (book adjustments)
10. Savings on account of commission being paid to the banks for PPO maintenance & pension calculation and disbursement
11. Easy disbursal since no cash transactions are carried out at the District/Sub-Treasuries
12. MIS reports also generated which was not possible in manual system
13. Number of active PDAs reduced from more than 600 to just 14
14. Software enabled checks for restoration, stopping pension, over-payments, arrear calculation
15.System utilises the reach of banks and knowledge of pension system in treasuries to the benefit of the pensioners.