Recommendations of the 7th Central Pay commission relating to pension/retirement benefits – KPTPA

Recommendations of the 7th Central Pay commission relating to pension/retirement benefits – KPTPA

Karanataka Posts and Telecommunications Pensioners Association
165, 4th Main, 3rd Block, 3rd Stage, Basaveshwaranagar
Bangalore – 560079

No.KPTPA/VII CPC/2015

17-12-2015

To
Shri S.K.Makkar
Under Secretary to the Govt. of India,
Department of Pension and Pensioners welfare
3rd Floor, Lok Nayak Bhawan
Khan Market, New Delhi – 110 003

Sir,

Subject: Recommendations of the 7th Central Pay commission relating to pension/retirement benefits

Reference: DoP&PW Letter No.38/66/13-P&PW(A) (Vol.II) dated 1/3rd December, 2015

We express our sincere thanks for calling for our views on the recommendations of the 7th Central Pay Commission relating to Pension/retirement benefits. We wish to write as stated below on the recommendations of the Pay commission. We would also like to point out some anomalies that may arise consequent upon implementation of the recommendations in toto. Some points of doubts are also given here under, which require to be clarified .It is requested that the points raised by us may please be examined and the suggestions made by us in further improvement of the benefits that are likely to accrue to Pensioners on implementation of the recommendations, may be accepted if found feasible and included in the Office Memorandum likely to be issued by DoP&PW in due course.

Our views/ comments /suggestions on the recommendations of the 7th Central Pay Commission made in para Nos.10.1.30, 10.1.33, 10.1.37, 10.1.41,10.1 .49,10.1.67 and 10.1.70 of its report are furnished on the respective paras arranged in chronological order for easy reference and perusal by DoP&PW.

Increase in the Rate of Additional Pension and Family Pension to the Older Pensioners

The Pay Commission, though, was of the considered view that age-related additional pension and family pension should be allowed from 75 years instead of 80 years as at present, had to recommend continuance of the additional pension at the existing rates/ ages since MoD reportedly, did not support its proposals. We urge the DoP&PW to consider the views of the Pay Commission in its perspective and allow the additional pension to commence at 75 years of age of Pensioners/Family Pensioners. We request further that 100 % of pension/ family pension should be allowed at the age of 95 years instead of at 100 years. As the average life span in the country is around 75 years and only a very small percentage of Pensioners live beyond 90 years and the percentage of those who attain 100 years is negligible, the request for lowering the age for entitlement of age-related additional pension may please be considered favourably.

We suggest grant of Additional Pension at the following rates

Age of Pensioner/ Family Pensioner	Additional quantum of pension
From 75 years to less than 80 years	20 % of basic pension
From 80 years to less than 85 years	30 % of basic pension
From 85 years to less than 90 years	40 % of basic pension
From 90 years to less than 95 years	50 % of basic pension
95 years or more	100 % of basic pension

Increasing the existing time period of seven years for enhanced family pension

Family pension at enhanced rate is paid for a period of 10 years to the spouse of an Employee dying while in service whereas, in the case of a Pensioner dying even immediately after retirement, the enhanced family pension is paid only for 7 years. This discrimination between Family Pensioners.needs to be removed. Hence, it is suggested that the period of payment of enhanced family pension may be increased to 10 years uniformly for all Family Pensioners.

Retirement Gratuity

Indexation of Gratuity to Dearness Allowance recommended by the Pay Commission is appreciated. However, the existing maximum of 16 ½ times the emoluments for calculation of Gratuity under Rule 50(1) (a) may be removed in view of delinking of full pension with 33 years off qualifying service from 1-1-2006.Removing the ‘maximum’ will benefit those employees who have rendered more that 33 years of qualifying service.

Death Gratuity

Revision of the slabs for payment of Death Gratuity and introduction of an additional slab of 11 to 20 years is appreciated. However,the existing maximum of 33 times of monthly emoluments for calculation of Death Gratuity under Rule 50(1) (b) may be removed in view of delinking of full pension with 33 years off qualifying service from 1-1-2006.Removing the ‘maximum’ will benefit the families of employees who die while in service after rendering more that 33 years of qualifying service.

Fixed Medical Allowance:

The Pay Commission has not recommended any increase in the amount of FMA of Rs. 500/- being paid to Pensioners not covered under CGHS. But, has recommended an increase in allowances such as Canteen Allowance, Children Education allowance, Constant Attendance Allowance etc paid to serving employees. Some allowances have been indexed to D A and the allowances will rise by 25% each time DA increases by 50 %.

We suggest that FMA must at least be doubled from the existing Rs. 500/- and indexed to Dearness Relief and it should rise by 25% each time DR increases by 50%.

Revision of Pension

The Pay Commission has recommended formulation for revision of pension of pre-2016 Pensioners and has suggested 2 types of calculations for computation of revised pension as on 1-1-2016. Option- I, is a simple method whereby the revised basic pension could be arrived at by multiplying the existing basic pension by 2.57. The other option, option-II , is not that simple as it necessarily, requires reference to the service records of the Pensioners to ascertain the number of increments the Pensioner had earned in that level while in service. Computation of revised pension after adding the number of increments to the notional minimum pay of the corresponding pay level in the Pay Matrix , will result in anomalies which have been narrated below. Several doubts that arise (stated below) need clarifications.

Anomalies

Almost all the pensioners would have been placed in a higher pay scale before their retirement consequent upon introduction of several career progression schemes Viz. ACP, MACP, Time bound financial up gradation schemes in addition to the regular promotions available in all the cadres/grades. So, to find out the number of increments earned in the grade /level from which the pensioner had retired, it is absolutely essential that the particulars of (a) the number of years of service rendered in that grade, (b) the stage of the pay scale at which the initial pay was fixed and (c) the last pay drawn are obtained from the service records/ pay bills etc. Collecting these particulars will no doubt be a herculean task especially in respect of pre- 1986 retirees since the records would have been weeded out.

Anomaly arises when a pensioner, who was placed in a higher pay scale at the fag end of his/her service, retires either without earning any increment or after earning one or two increments. In such cases, fixation of pension with reference to the notional pay of the lower pay scale/ lower level after adding increments earned in lower level would be more beneficial than fixation of pension with reference to the notional minimum pay of the higher level (without added increments) from which he /she had retired .The anomaly is well brought out in the example given below.

Example -1

A. Calculation of pension if computed with reference to the higher pay scale/higher level from which the pensioner had retired without earning any increments

(Promoted from Grade S-19 to S-21 eitht months before retirement) – Read More click here

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