Is the Universal Pension Scheme discriminatory to public university teachers?
We spoke to stakeholders to look into the public university teachers’ claims of discrimination – raising the question of equality across different government quarters among other things – and at the same time, compared it to some of the existing pension schemes across the region
A few days ago, if anyone had said that public universities would come to a standstill – halting classes and examinations with locks hanging from administrative buildings – due to a teachers' protest, no one would believe them.
But, here we are.
The teachers are protesting the Prottoy Pension Scheme, which had been made effective from 1 July 2024. Under the new scheme, the benefits are much less compared to the current pension system and the teachers argue that this deduction will reduce their take-home pay significantly.
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If the rational justification of the decision is universal inclusion, which is the true intention of our honourable Prime Minister Sheikh Hasina, it should be the same for all — bureaucrats, university teachers, employees in autonomous institutions.
On the other hand, the National Pension Authority sees it as a step towards creating a uniform and sustainable pension system for all public sector employees, asserting that it offers greater monthly payouts than the current system.
We spoke to stakeholders to look into the public university teachers' claims of discrimination – raising the question of equality across different government quarters among other things – and at the same time, compare it to some of the existing pension schemes across the region.
Before we delve further into the issue, are the university teachers getting the short end of the stick? Under the new scheme, 10% of salaries from teachers across all pay grades will be deducted to contribute to the pension fund. Meanwhile, in the existing system, no money is deducted from their salaries – this is the crux of the difference.
For instance, at present, a university professor gets Tk80.73 lakh as a lump sum gratuity upon retirement. Later, he gets Tk45,790 a month as a pension — this is the case when the basic salary is Tk78,000, according to the government's Grade-1 pay grade.
Under the Prottoy scheme, a teacher retiring at 65 (and starting at 30 years of age) would receive Tk1,24,660 per month. But he would not get any lump sum gratuity.
Additionally, there are other benefits under the current scheme that Prottoy does not offer — this includes but is not limited to lifetime pension benefits for the nominee after the pensioner's death.
Then there is a 5% pension increase each year, there is Leave Preparatory Retirement (LPR) and festival benefits – all under the current scheme but not in Prottoy.
If we are to look at our neighbouring pension schemes, how do we fare?
Foreign pension schemes
In Vietnam, there exists a universal pension scheme for all service holders, including university teachers. Employees and employers are required to contribute to this scheme. A government agency (Vietnam Social Security) manages this scheme and records employees' past salaries reported by employers.
In Sri Lanka, a pension scheme was introduced for university teachers on 24 March 1999 and became effective on 1 September of the same year. There, teachers who have served for 20 years or more and retire at the stipulated ages receive a monthly pension for life, calculated as a percentage of their last drawn salary—1.0% for those retiring at 55, 1.2% at 60, and 1.4% at 65.
Upon the death of a pensioner, 50% of the pension is paid to the widow/widower and the remaining 50% is equally divided among children until they reach 18 years of age. The pension scheme undergoes a review every three years to amend benefits for new employees.
In India, a government teacher or professor receives a guaranteed monthly pension of a minimum of RS9,000, which can extend up to 50% of the highest pay – almost RS1.25 lakh per month.
Gratuity is also provided to them. Here, they are similarly allowed to receive this benefit after retirement or death up to a maximum of RS20 lakh. The rate of gratuity calculation is equal to 1/4th of their last drawn basic salary for each completed service of six months.
In India, teachers have to contribute 10% of their salary to their pension fund each month.
In Pakistan, university teachers, along with other civil servants, receive retirement benefits under the Civil Service Pension Scheme (CSPS). They also receive a lump-sum benefit at retirement from the Employees Provident Fund. However, the pension disbursement is in disarray in some places due to the economic crisis.
'If the scheme is inclusive, why don't the bureaucrats join it?'
The National Pension Authority is reluctant to scrap the new scheme. The pension authority has said that no other groups have objected to the scheme except the university teachers.
The government argues that standardising the pension system across various sectors, including public universities, ensures fairness and equity.
Professor Dr Shahadat Hossain Siddique of the Department of Economics, Dhaka University said, "If the rational justification of the decision is universal inclusion, which is the true intention of our honourable Prime Minister Sheikh Hasina, it should be the same for all — bureaucrats, university teachers, employees in autonomous institutions."
Professor Siddique is one of the five members of the Dhaka University Teachers' Association team who reviewed Prottoy. He added, "Those who receive a pension, receive it according to the government policies. Those who receive pensions should get the same scheme. If the bureaucrats think the Prottoy scheme is better, I would ask them to join the scheme as well.
Then, we, the teachers' community, will have no complaints."
The university teachers think that since they get the same pension as the bureaucrats at present, the bureaucrats should be included in the Prottoy scheme as well.
"A vested quarter inside the government confused the prime minister and led her to introduce the universal pension scheme. This scheme is discriminatory," said Professor Nizamul Hoque Bhuiyan, secretary general of the Federation of Bangladesh University Teachers' Association and Dhaka University Teachers' Association president.
This issue was raised to the relevant government when the Finance Ministry issued a gazette on the Prottoy scheme in March this year, according to Professor Hoque, "but it fell on deaf ears."
Member of the National Pension Authority, Golam Mustafa told Prothom Alo on 30 June, "According to the government's decision, the scheme will start from July 1. We have calculated that the beneficiaries will get more under the scheme. If any issue emerges in future, it can be corrected then. There is no point of objection to the scheme right now."
Professor Hoque also pointed to the issue of Shebok — the new pension scheme for bureaucrats said to be published next year. "Before the introduction of Prottoy, we were at the same scheme as the bureaucrats. We do not know whether we would still be at the same level as them under the new schemes, as we do not know what benefits are Shebok."
He argued, "If we find that they are getting better benefits than us in their upcoming scheme, what would we do then? We will not be able to protest then since we have already accepted the Prottoy scheme."
There are concerns among students that if the ongoing teachers' movement continues for an extended period of time, it may cause session jams and hamper their academic activities.
"We know that the movement is hampering academic activities. The exams are being postponed. And there is a chance that it may create a session jam. If the government accepts our demands, we will take special classes to recover the academic loss and exams for the students," said Professor Nizamul Hoque Bhuiyan.
