7th PAY COMMISSION PENSIONERS NEWS-Resolutions regarding Govt Recommendations.


(Department of Pension and Pensioners’ Welfare)
New Delhi, the 4th August, 2016

No.38/37/2016-P&PW (A) - The Terms of Reference of the Seventh Central Pay Commission as contained in Ministry of Finance (Department of Expenditure) Resolution No.1/1/2013-E.Ill (A) dated 28.2.2014 included the following:

“To examine the principles which should govern the structure of pension and other retirement benefits, including revision of pension in the case of employees who have retired prior to the date of effect of these recommendations, keeping in view that retirement benefits of all Central Government employees appointed on and after 01.01.2004 are covered by the New Pension Scheme (NPS).”

2. The Commission, on 19th November, 2015, submitted its report to the Government on Terms of Reference as contained in aforementioned Resolution dated 28.02.2014. Government, after consideration, has decided to accept the recommendations of the Commission on pensionary benefits to the Central Government civil employees, including employees of the Union Territories and Members of All India Services subject to certain modifications, as specified hereinafter.

3. Detailed recommendations of the Commission relating to pensionary benefits and the decisions taken thereon by the Government are listed in the statement annexed to this Resolution.

4. The revised provisions regarding pensionary benefits, which have been accepted as indicated in the Annexure, will be effective from 01.01.2016.

(Vandana Sharma)
Joint Secretary to the Govt. of India

Statement showing the recommendations of the Seventh Central Pay Commission relating to principles which should govern the structure of pension and other terminal benefits and the decisions of the Government thereon.

Item No.
Decision of Government
Fixed Medical Allowance
The commission notes that this allowance was enhanced from Rs.300/- p.m. to Rs.500/-p.m. from 19.11.2014. As such, further enhancement of this allowance is not recommended.
(Para 8.17.52 of the Report)
To be examined by a committee comprising Finance Secretary and Secretary (Expenditure) as Chairman and Secretaries of Home Affairs, Defence, Posts, Health & Family Welfare, Personnel & Training
and Chairman, Railway Board, as Members. Till a final decision is taken based on the recommendations of the
Committee, Fixed Medical
Allowance shall be paid at existing rates.
Constant Attendance Allowance
The allowance may be increased by a factor of 1.5 i.e to Rs.6750/- per month. The Allowance needs further increase by 25% each time DA rises by 50%
(Para 8.17.29 of the Report)
To be examined by a Committee comprising Finance Secretary and Secretary (Expenditure) as Chairman and Secretaries of Home affairs, Defence, Posts, Health & family welfare, personnel & Training and chairman, Railway Board as Members. Till a final decision is taken based on the recommendations of the committee. Constant attendant Allowance shall be paid at existing rates.
General Provident Fund
Status quo may be maintained in this respect.
(Para 9.4.4 of the Report
Rates of Pension & Family Pension
The Commission does not recommend any further increase in the rate of pension and Family Pension from the existing levels.
(Para 10.1.25 of the Report)
Quantum of Minimum Pension
The recommendations of the commission in relation to pay of a personnel will lead to a significant increase in the minimum from the existing Rs. 7,000 per month to Rs.18,000 per month. This, based on computation of pension, will raise minimum pension from the existing Rs.3500 to Rs. 9,000. The minimum pension based on the recommendations of the commission will increase by 2.57 times over the existing level.
(Para 10.1.27 of the Report)
Rate of additional Pension and Family Pension to the older pensioners
The commission is of the view that the existing rates of additional pension and additional family pension are appropriate.
(Para 10.1.30 of the Report)
Time Period for enhanced family pension.
The commission notes that the recommendation with regard to period of eligibility of the enhanced family pension of 10 years in case of death of a serving employee was made based on the recommendations of VI th CPc Report. No further change is being recommended by the commission.
Gratuity Ceiling and its indexation.
The Commission recommends enhancement in the ceiling of gratuity from the existing Rs.10 lakhs to Rs.20 Lakh from 01.01.2016. The Commission further recommends the ceiling on gratuity may increase by 25% whenever DA rises by 50%.
(Para 10.1.37 of the Report)
Rationalization of death gratuity
The Commission, after examination of the matter, recommends the following rates for payment of death gratuity:
Length of Service
Rate of Death Gratuity
Less than One Year
2 times of monthly
One year or more but less than 5 years
6 times of monthly emoluments
5 years or more but less than 11 years
12 times of monthly emoluments
11 years or more but less than 20 years
20 times of monthly emoluments
20 years or more
Half month of emoluments for every completed six monthly period of qualifying service subject to a maximum of 33 times of emoluments.
Para 10.1.41 of the Report
Commutation of Pension and restoration of commuted pension
The Commission does not recommend any change either in the maximum percentage of commutation or in the period of restoration.
(Para 10.1.43 of the Report)
Revision of Pension of Pre 7th CPC Retirees
The Commission Recommends the following pension formulation for civil employees including CAPF personnel who have retired before 01.01.2016
(i)All the civilian personnel including CAPF who implementation of the Seventh CPC recommendations) shall first be fixed in the pay Matrix being recommended by this commission, on the basis of the Pay Band and Grade Pay at which they retired, at the minimum of the corresponding level in the Matrix. This amount shall be raised, to arrive at the notional pay of the retiree, by adding the number of increments he/she had earned in that number of increments he/she had earned in that level while in service, at the rate of three percent. Fifty percent of the total amount so arrived at shall be the revised pension.
(ii) The second calculation to be carried out is as follows. The pension, as had been fixed at the time of implementation of the VI CPC recommendations, shall be multiplied by 2.57 to arrive at an alternate value for the revised pension.
(iii) Pensioners may be given the option of choosing whichever formulation is beneficial to them.
It is recognized that the fixation of pension as per formulation in (i) above may take a little time since the records of each pensioner will have to be checked to ascertain the number of increments earned in the retiring level. It is therefore recommended that in the first instance the revised pension may be calculated as at (ii) above and the same may, be paid as an interim measure. In the event calculation as per (i) above yields a higher amount the difference may be paid
subsequently.(Para 10.1.67 and Para 10.1.68 of the Report)
Both the options recommended by the 7th Central Pay Commission as regards pension revision be accepted subject to feasibility of the implementation. Revision of pension using the second option based on fitment factor of 2.57 be implemented immediately. The first option may be made applicable if its implementation is found feasible after examination by the Committee comprising Secretary (Pension) as Chairman and Member (Staff). Railway Board, Member (Staff), Department of Posts, Additional Secretary & Financial Adviser, Ministry of Home Affairs and Controller General of Accounts as Members
Ex-gratia Lumpsum Compensation
The Commission recommends a Common regime for payment of ex-gratia lump-sum compensation for civil and defence forces personnel, payable to the next of Kin at the following rates:
Death occurring due to accidents in course of performance of duties
10 Lakh
25 Lakh
Death in the course of performance of duties attributed to acts of violence by terrorists, anti social elements etc.
10 Lakh
25 Lakh
Death occurring in border
skirmishes and action
against militants, terrorists,
extremists, sea pirates
15 Lakh
35 Lakh
Death occurring while on
duty in the specified high
altitude, unaccessible border
posts, on account of natural
disasters, extreme weather
15 Lakh
35 Lakh
Death occurring during enemy action in war or such war like engagements, which are specifically notified by
Ministry of Defence and
Death occurring during
evacuation of Indian
Nationals from a war-torn
zone in foreign country
20 Lakh
45 Lakh
(Para 10.2.77)


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