A brief note of the Ministry of DOPT on New Pension Scheme - Retirement Benefits
The
below questions raised by the Hon'ble Member of Parliament
Shri.Aswamedh Devi in the Lok Sabha and the Minister of State in the
Ministry of Personnel, Public Grievances and Pensions and Minister of
State in the Prime Ministers Office Shri. V. NARAYANASAMY answered to
the question below quoted on 05.12.2012 in the written form as
follows...
Questions :-
Whether
the Union Government employees recruited after January, 2004 are not
eligible for retirement benefits such as pension, GPF and gratuity..?
Whether
not providing gratuity, pension and GPF facility is a discrimination
with employees recruited after January, 2004 as the same is being
provided to the employees of private sector..?
Whether the
Government proposes to provide all retirement benefits including
gratuity to the Government servants recruited after January, 2004..?
Answer :-
A
new restructured defined contribution pension system for the new
entrants to Central Government service, except to the Armed Forces,
replacing the system of defined benefit pension including GPF, was
notified on 22nd December, 2003. The Government employees appointed on
or after 1.1.2004 and governed by the New Pension System can withdraw
60% of their Pension Fund as a lumpsum when they retire and the balance
40% of their wealth is used to purchase an annuity scheme from a life
insurance company of their choice, which will pay him/her a monthly
pension for the rest of his life. In casethe employees leave the New
Pension Scheme prior to age 60, the mandatory anuitization would be 80%
of the pension wealth.
The monthly annuity under
the New Pension Scheme is only a replacement of pension on retirement
and family pension on death after retirement. The benefits of
Death-cum-Retirement Gratuity (DCRG) and pension/family pension have
been provisionally allowed, vide Department of Pension & Pensioners`
Welfare OM No. 38/41/06-P&PW(A) dated 5.5.2009, in respect of the
Central Government servants covered by the New Pension Scheme in cases
where a Government Servant is retired on invalidation/disability and in
the case of death of a Government servant in service, on the same rates
as are applicable under the old pension scheme, i.e. CCS (Pension)
Rules, 1972.
The details of DCRG payable to employees of Central Government under NPS are as under:
(i)
The retirement gratuity is payable to the retiring Government servant. A
minimum of 5 years qualifying service and eligibility to receive
service gratuity/ pension is essential to get this one time lump sum
benefit. Retirement gratuity is calculated @ l/4lh of a month`s Basic
Pay plus Dearness Allowance drawn before retirement for each completed
six monthly period of qualifying service. The maximum retirement
gratuity payable is 16 XA times the Basic Pay, subject to a maximum of
Rs. 10 lakhs.
(ii) If the Government Servant dies
while in service, the death gratuity shall be paid to his family at the
rates furnished in the table below:
| S.No. | Length of Qualifying Service | Rate of Death Gratuity |
|---|---|---|
| 1. | Less than one year | 2 times of emoluments |
| 2. | One year or more but less than 5 years | 6 times of emoluments |
| 3. | 5 years or more but less than 20 years | 12 times of emoluments |
| 4. | 20 years or more | Half of emoluments for every completed six monthly period of qualifying service subject to a maximum of 33 times of emoluments. |
Maximum amount of Death Gratuity admissible is Rs. 10 lakhs w.e.f. 1.1.2006.
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