7th Pay Commission pension calculator: How pension for retired central government employees is calculated

7th Pay Commission: There has been a lot of buzz around the National Pension Scheme and its benefits. Recently, the government has streamlined the NPS based on the recommendations of a committee set up on the advice of the 7th Pay Commission. The Centre has also enhanced its contribution in the pension fund to 14 per cent from 10 per cent earlier.

However, if you are a government employee and want to know how your pension will be decided, we provide below an explanation for the same. The salient features of the pension entitlements of persons retiring as Central Government employees are as under:

* A Government servant retiring in accordance with the rules, after completing qualifying service of not less than 10 years, is entitled to a pension @ 50% of his last pay or 50% of average emoluments for the last 10 months, whichever is more beneficial to him/her.

* After completion of 80 years of age or above, additional pension @ 20% to 100% is payable to the retired Government servant.

* A retired/retiring Government servant is entitled to, at his/her option, a lump sum payment, by computation of a maximum of 40% of his/her pension.

* On retirement, a Government employee is entitled to a retirement gratuity based on his/her emoluments and length of qualifying service.

* On death of a Central Government pensioner, the family is entitled to a family pension the amount of which is 50% of the last pay for a period of seven years, or for a period up to the date on which the retired deceased Government servant would have attained the age of 67 years had he/she survived, whichever is earlier. Thereafter, the amount of family pension is 30% of his last pay.  The amount of family pension is also increased by 20% to 100% after the family pensioner attains the age of 80 years and above.

* The family of a Government servant, who dies while in service after having rendered not less than seven years’ continuous service, is entitled to a family pension 50% of the last pay for a period of ten years. Thereafter, the amount of family pension is 30% of his/her last pay.

The new entrants to the central government service on or after 01.01.2004 are covered under the National Pension System (NPS).

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Government employees become entitled to pension on retirement. There were rumours that the government may increase the retirement age. However, the Department of Social Justice & Empowerment informed that there is also no proposal to increase or decrease the age of retirement of Central Government Employees.