Minimum pension fixed for retired Central Government employees

Minimum pension fixed for retired Central Government employees

Minimum Pensions

The minimum pension fixed for retired Central Government employees is Rs. 3,500/- per month with effect from 01.01.2006. For pensioners, including those retired from public sector corporations and other establishments, to whom the Employees’ Pension Scheme (EPS), 1995 framed under the Employees’ Provident Funds & Miscellaneous Provisions Act, 1952 applies, provision of a minimum pension of Rs. 1,000/- per month has made with effect from 01.09.2014.

The Sixth Central Pay Commission had recommended pension of Rs. 3,330/- per month in respect of employees retired from the Central Government. The minimum pension of Rs. 1,000/- per month under the EPS, 1995 implemented by the Central Government was one of the recommendations of the Expert Committee constituted by the Government. Apart from this, the Committee on Petitions of the Rajya Sabha under the chairmanship of Shri Bhagat Singh Koshiyari in its 147th Report had recommended to increase Government share of contribution under EPS, 1995 from 1.16 per cent to 8.33 per cent to support the minimum pension level of Rs. 3000/- per month. However, it was not found feasible for implementation.

No complaints regarding anomalies in minimum pension in respect of Central Government employees have been received by the Government.

However, representations, grievances and complaints have been received from various quarters that the monthly pension to pensioners under EPS, 1995 have not increased to Rs. 1,000/- per month even after the notification in respect of pensioners who had taken short service pension, commutations or return of capital. Some grievances also relate to the fact that pension has not increased for those drawing more than Rs. 1,000/- per month.

Consequent upon implementation of the minimum pension to pensioners under EPS, 1995 vide notification number GSR 593(E) dated 19.08.2014, the pension of all member/widow(er)/disabled/ nominee/dependent parent pensioners whose original pension was less than Rs. 1,000/- per month had been fixed at the minimum of Rs. 1,000/- per month. In cases where members had preferred option for Commutation, Return of Capital and Short Service Pension and have already availed these benefits as per choice exercised by them at the time of making pension claim, the deductions on account of these options would continue to apply on the minimum pension of Rs. 1,000/- per month that has now been fixed. In such cases, the pension amount would be less than Rs. 1,000/- per month even after implementation of the said notification.

This information was given by Shri Bandaru Dattatreya, Minister of State (IC) for Ministry Labour and Employment, in reply to a question in Lok Sabha today.

Source: PIB News

Minimum pension of Rs. 1,000/- per month in perpetuity to Pensioners of Employees’ Pension Scheme, 1995

Minimum pension of Rs. 1,000/- per month in perpetuity to Pensioners of Employees’ Pension Scheme, 1995

The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi, today gave its approval for continuation of the minimum pension of Rs. 1,000/- per month to the pensioners of Employees’ Pension Scheme, 1995 (EPS) beyond the financial year 2014-15 on perpetual basis. Currently, it is effective only upto March, 2015. The Cabinet also approved corresponding grant of continuous annual budgetary support for implementing the minimum pension which will be to the tune of Rs. 850 crore per year on a tapering basis.

Providing a minimum pension of Rs. 1000/- per month is an effort to provide meaningful subsistence to pensioners who have served in the organized sector. The present proposal is likely to benefit approximately 20 lakh pensioners under EPS, 1995.

Background:

A large number of member pensioners under the EPS, 1995 receive low pensions which is not commensurate with the growing cost of living. The primary reason behind a meager pension is that it is calculated on the basis of pensionable service and average of last sixty months’ wages. If either of them is low, the pension amount will also be low. This is largely seen in cases of employees of seasonal industries. Further, pensioners who were earlier members of the erstwhile Family Pension Scheme, 1971 have been given past service benefits for determining pension as per Para 12 of the Employees’ Pension Scheme. This has resulted in fixation of low pension for these pensioners.

The Union Cabinet has in its meeting in February, 2014 accorded approval to the proposal for ensuring a minimum pension of Rs. 1,000/- per month for the pensioners of EPS for the financial year 2014-15 by way of providing budgetary support of Rs. 1217.03 crore. Based on the approval of the Union Cabinet, the Employees’ Pension Scheme, 1995 (EPS) was amended on 19.08.2014 to incorporate the provision for providing a minimum pension of Rs. 1,000/- per month for the financial year 2014-15.

After the issue of the Gazette Notification dated 19.08.2014 (with effect from 01-09-2014), the Employees’ Provident Fund Organisation (EPFO) has commenced disbursing the revised pension from the month of September, 2014. The number of pensioners who have been benefited by the minimum pension provision, which has been compiled from the actual disbursement of pension made by the offices of EPFO after the implementation of the notification, is according to the table below:

Month	Number of Pensioners affected	Amount as per original pension (Rs. Crore)	Amount paid after Minimum Pension Notification (Rs. Crore)	GOI support
September 2014	19,19,756	104.17	165.98	61.81
October 2014	19,32,515	104.14	166.99	62.84
November 2014	19,42,476	104.69	168.18	63.49
December 2014	19,47,750	106.73	170.68	63.95
January 2015	15,13,827	94.72	148.75	54.03
February 2015	16,80,533	103.00	160.15	57.15
March 2015	17,65,307	99.25	158.39	59.13

Source: PIB News