New pension rules with better pay panel package
This should cheer former central government employees. With the Centre notifying the new pension rules, they can expect a higher pension packet from next month. The revised pensions are higher than what the sixth Pay Commission recommended.
Although the move benefits the cross-section of retired employees, those in higher brackets have gained more in real terms. New pensions for defence and railway personnel will be notified separately.
Older pensioners have an added reason to rejoice. Centenarians will get 100% extra pension calculated at revised rates. Similarly, those over 80 years will get an additional 20% of their basic pension. This goes up by 30%, 40% and 50% for those over 85, 90 and 95, respectively.
To get an idea of the quantum of hike, a person with a basic pension of Rs 10,000 — who used to get Rs 22,050 in hand — will now receive a total pension of Rs 26,216. The new rates are effective from January 2006 and the arrears will be given out in two instalments — 40% during the current fiscal, 60% in 2009-10 . The maximum gratuity too has been revised to Rs 10 lakh, up from the earlier Rs 3.5 lakh. If an employee dies during service, his family will now get full pension (enhanced family pension) for 10 years.
The new rules also add more flexibility in retirement benefits. For instance, those who are due to retire can now get 40% of their pension commuted and get a lump sum amount in turn.
Minimum pension Rs 4,060, up from earlier Rs 2,813 in hand (revised pension to be effective from Jan 1, '06).
Maximum pension Rs 52,200, up from Rs 33,075.
Maximum gratuity up to Rs 10 lakh (depending on years of service and last salary drawn).
Enhanced family pension, for employees dying in service, to be full pension for 10 years.
Employees eligible for full pension if service is for 20 years.
Incremental additional pension for those 80 years and above. People over 100 to get double pension.
(Courtesy: Timesofindia.com )