Retirement Benefits

Absorption in PSU & Pension

No.4/59/98-P&PW(D)
Government of India
Ministry of Personnel, Public Grievances & Pensions
(Department of Pension & Pensioners’ Welfare)
Third Floor, Lok Nayak Bhavan, New Delhi,

dated the 12th January, 1999

OFFICE MEMORANDUM

Implementation of Governmentís decisions on the recommendations of the Fifth Central Pay Commission relating to retirement benefits Ė extension of the provisions of the O.M.No.45/10/98-P&PW(A) dated 17th December, 1998 to absorbed employees in PSUs/Autonomous Bodies

In accordance with the instructions contained in this Departmentís O.M. No. 45/10/98-P&PW(A) dated 17th December, 1998, with effect from 1.1.96, pension of all pensioners irrespective of their date of retirement shall not be less than 50% of the minimum pay in the revised scale of pay introduced w.e.f. 1.1.1996 of the post held by the pensioner, provided the pensioner had rendered maximum required service for full pension as per the rule applicable to the pensioner as on the date of his superannuation/retirement. However, such pension will be suitably reduced pro-rata where the pensioner has rendered less than the maximum service prescribed in the rules so as to be eligible for full pension, and it will in no case be less than Rs.1275/-p.m. w.e.f. 1.1.96. These orders further provide that family pension shall not be less than 30% of the minimum pay in the revised scale of pay introduced w.e.f. 1.1.96 of the post last held by the pensioner/deceased Government servant.

2. Since the O.M. dated 17.12.1998 does not contain any provision in regard to its applicability to the Central Government employees absorbed in PSUs/autonomous bodies, it is clarified that the provisions of this O.M. shall also be applicable to Government servants who, on absorption in a PSU/autonomous body, had opted for payment of pro-rata monthly pension (with option to commute 1/3rd pension).

3.Those Government servants who had drawn lumpsum payment on absorption in a PSU/autonomous body and have become entitled to restoration of 1/3rd commuted portion of pension after 15 years from the date of commutation or 1.4.85, whichever is later, in terms of this Departmentís O.M.No.4/3/86-P&PW(D) dated 30.9.96 and to the revision of the restored amount in terms of this Departmentís O.M.No.4/59/97-P&PW(D) dated 14.7.1998, shall also be entitled to the benefit of the O.M. dated 17.12.98. In other words, the restored amount of 1/3rd commuted portion of pension shall not be less than 1/3rd of the minimum revised pay as on 1.1.1996 of the post held by the absorbed employee under Government prior to absorption subject to the condition that the absorbed employee had rendered the maximum required service for full pension as per the rule applicable on the date of his absorption in the PSU/autonomous body. In cases where the qualifying service under Government prior to absorption was less than the maximum required service for full pension as per the rule in force on the date of absorption, the proportionate pension shall be worked out as per Rule 49 of the CCS (Pension) Rules, 1972 and one-third of such pension shall be admissible w.e.f. 1.1.96 or from the date of restoration, whichever is later. Wherever the pension/proportionate pension works out to be less than Rs.1275/- it will have to be raised to Rs.1275/- w.e.f. 1.1.96 before one-third portion of such pension is restored w.e.f. 1.1996 or 15 years from the date of commutation, whichever is later.

4. Family pension wherever admissible in terms of the clarifications contained in para 9 of this Departmentís O.M. No.4/59/97-P&PW(D) dated 14.7.98 shall also not be less than 30% of the minimum pay in the revised scale of pay introduced w.e.f. 1.1.96 for the post held by the absorbed employee under Government prior to absorption in the PSU/autonomous body.

5. Wherever the restored amount of one-third commuted portion of pension/family pension as worked out under the existing instructions happens to be more beneficial, the pension/family pension of such absorbed employees shall not be regulated under these orders.

6.Wherever the restored amount of one-third commuted portion of pension has already been revised in terms of this Departmentís O.M.No.4/59/97-P&PW(D) dated 14th July, 98, it shall be the responsibility of the Head of the Department of the Ministry, Department, Office etc. to revise the restored amount in terms of the provisions mentioned in the preceding paragraphs. In those cases where action is yet to be taken to revise the restored amount in terms of the O.M. dated 14th July, 98 the provisions of this O.M. should be kept in view while restoring the one-third commuted portion of pension.

7.The pension sanctioning authorities are requested to ensure that at the time of preparing PPOs in these cases for authorisation of payment, they should clearly superscribe the PPOs as ĎPSU/autonomous body absorbeesí and also suitably indicate the originally sanctioned one-third commuted value of pension. This will enable all concerned, whenever any revision/merger takes place in future, to identify these cases and ensure that they do not get merged with regular pensioners.

8. These orders issue with the approval of the Ministry of Finance, Department of Expenditure vide their U.O.No.1212/EV/98 dated 4.1.1999.

9. Hindi version of this O.M. is enclosed.

(SUJIT DATTA)
Director (PW)

To
All Ministries/Departments of the Government of India.

Copy to:

Office of the Comptroller & Auditor General of India with 200 spare copies.


Department of Personnel and Training
Department of Administrative Reforms & Public Grievances.


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