7th pay commission: Central Government employees should know these key facts on pension

7th pay commission: Pension plays a significant role in the sustenance of a government employee after his retirement. According to the 7th pay commission norms, pension benefits have been extended by many states to their employees. However, it has been witnessed that most the employees are not familiar with pension norms and they come to know about these rules only after their retirement or superannuation. Therefore, this is necessary on their part to keep them abreast with provisions of it before their retirement, rather it should be part of their retirement planning. 

According to pension provisions, eligibility for pension requires a government servant to be appointed in a pensionable establishment on or before 31.12.2003, and he should retire from government service with a qualifying service of 10 years or more.

Notably, the provisions regarding revision of pension of pre-2016 pensioners are given below, as per the 7th CPC's recommendations.

1. According to government orders, revision of pension of pre-2016 pensioners is done by multiplying the pre-revised pension by a factor of 2.57, which is the fitment factor. This was to be done by the Pension Disbursing Authorities/ Banks.

2. Further orders were issued, dated 12.05.2017 stating that the revised pension/family pension w.e.f 01.01.2016 of all Central Civil Pensioners/ family pensioners, including CAPF’s, who retired/died prior to 01.01.2016, shall be revised by notionally fixing their pay in the pay matrix recommended by the 7th CPC in the level corresponding to the pay in the pay scale/ pay band and grade pay at which they retired/ died. This will be done by notional pay fixation under each intervening Pay Commission based on the Formula for revision of pay.

3. While fixing pay on notional basis, the pay fixation formula approved by the government and other relevant instructions on the subject in force at the relevant time shall be strictly followed. 50% of the notional pay as on 01.01.2016 shall be the revised pension and 30% of this notional pay shall be the revised family pension w.e.f. 01.01.2016 as per the first Formulation. 

4. In this case of family pensioners who were entitled to family pension at enhanced rate, the revised family pension shall be 50% of the notional pay as on 01.01.2016 and shall be payable till the period up to which family pension at enhanced rate is admissible as per rules.  The amount of revised pension/family pension so arrived at shall be rounded off to next higher rupee.