Discrepancy deprives LG leaders of PF

No PF deductions were made from the salaries of gups, mangmis and tshogpas

Entitlement: A major discrepancy in the financial system has deprived most of the incumbent local government (LG) members of their retirement benefits.

A thrompon, who completed his tenure recently, received all the post-retirement benefits, while the other LG members like gups and tshogpas may receive gratuity only. This is because deductions for retirement benefits were made from the thrompons’ salaries.

Although the LG Entitlement Act came into effect about a year ago, it is yet to be implemented. The government has cited the lack of a rules and regulations for its inability to implement the Act.

However, PF deductions were made from the thrompon’s salary even without the entitlement Act, let alone the rules and regulations.

Thrompons are governed by the LG Act, as are gups, mangmis and tshogpas. This means that just like tshogpas, gups and mangmis, thrompons are elected members of LG.

Hence, the entitlement Act applies to all members of local governments – dzongkhag tshogdu, gewog tshogde and thromde tshogde.

On the other hand, provident fund and other deductions were made from the salaries of the members of the first Parliament in 2008 even without the parliament members’ entitlement Act in place. And questions on why no deductions were made from the LG leaders’ salaries have been asked.

A local leader said “the system has differentiated” between thrompons and the other members of LG. “Thrompons are elected LG members just like us,” he said. “Why a special treatment for thrompons?” he said.

No agency has taken responsibility for the lapse. But it is the government, according to the Act, that should make statutory deductions from the salary, allowances, benefits and other emoluments of a LG member.

A LG member is entitled to PF in accordance with the National Pension and Provident Fund (NPPF) rules and regulations. At least a year of monthly deductions are mandatory for a member of NPPF to be eligible for PF.

When the Act was passed in July last year, there was less than a year left for the LG members to complete their tenure. The LG leaders will complete their tenure in June.

However, in what is a solace for the incumbents, the government has indicated that it will pay gratuity. The Act states that a member retiring on completion of his or her term of office is entitled to gratuity.

A home ministry official said no deductions are required for gratuity and that it will be paid from the government account. “But in case of PF, the government cannot do anything unless the LG leaders have their account,” said the official.

Home minister Dawa Gyaltshen at the Meet-the-Press last Friday said the local leaders will receive their entitlements as per the entitlement Act. But there are procedures they need to follow, meaning that it is too late for the incumbent LG members to open PF accounts.

Meanwhile, the ministry is waiting for endorsement of rules and regulations for implementation of the Act by the Cabinet. A draft rules and regulations have been submitted to the finance ministry for review and submission to the cabinet.

The entitlements given to a LG member includes salary, allowances, and retirement benefits that include gratuity and PF.

The entitlement Act states that a LG member is entitled to salary, allowances, benefits and other emoluments from the day on which the member is declared elected.

The entitlement Act guarantees retirement benefits for local leaders on completion of their term. The entitlement Act came into force on July 20 last year.

Normally, an Act is implemented with effect from the enforcement date.

MB Subba

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