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Pension is a steady income given to a person after retirement from the organization.
Rules
(i) The qualifying service for evaluation of pension is reduced to 20 years w.e.f.
01.09.2008. Earlier it was 33 years.
(ii) Pension is evaluated on the basis of the last 10 months average pay or last pay
drawn whichever is beneficial to retiring employee
Ceiling
(a) For officers / employees retired in between 01.12.2005 to 31.12.2005
(i) Minimum Pension & Minimum Family Pension - Rs 2396 /- per month
(ii) Maximum Pension - Rs 24956 /- per month
(iii) Maximum Family Pension - Rs 14974 /- per month
(i) Minimum Pension & Minimum Family Pension - Rs 2972 / - per month
(ii) Maximum Pension - Rs 30946 /- per month
(iii) Maximum Family Pension - Rs 18568 /- per month
(i) PENSION
(ii) DCRG (Death Cum Retirement Gratuity)
(iii) COMMUTATION
(iv) RESTORATION of Pension
(v) FAMILY PENSION
(i) PENSION
The pension amount is calculated based on the Basic Pay at the time of retirement, Age,
Service years, etc. It is calculated as 50% of average emoluments of last 10 months
salary drawn. It is calculated on Basic and Dearness Pay only.
OR
(iii) COMMUTATION
• At the time of retirement of the employee, a portion of pension can be withdrawn
by the employee.
• A maximum of 40% of pension amount can be withdrawn at the time of
retirement. However, depending on the amount withdrawn proportionate amount
will be deducted from the Pension amount till 15 years and employee will get
reduced Pension till 15 years.
(iv) RESTORATION
The commuted portion of pension shall be restored on expiration of 15 years from the
date of retirement. After this period the employee is entitled for full pension.
Prerequisite Data
Average Emoluments
SMP = 32 x 2 = 64 SMP
Total Pay
Last Basic Drawn = 12725.00
Dearness Pay (50% of Basic) = 6363.00
Dearness Allowance (29% of Basic + DP) = 5536.00
Total Pay = 24624.00
Calculation of Pension
(i) Pension
SMP
= [ 50% of Avg. emoluments (last 10 months) X ------
66
50 64
= (------- x 19088 x --------)
100 66
24624.00 X 64
= ( ---------------------------)
4
= 393984.00
=> 350000.00
(Limited to maximum Rs 3,50,000.00)
(Limited to 10 Lakhs as declared on 26 Jan 2009)
= 40 % x 9255.00 x 10.46 x 12
= 464675.00
Note: The amount DA on Full Pension varies as per the DA fixed from time to time,
however only (full pension – commutation percent on full pension) is shown in the
order. In this case Reduced Pension = Rs 5553 /-
FAMILY PENSION CALCULATION
DCRG – If employee is dead before attaining his qualifying Service of Retirement, The
calculation of DCRG in such case is as follows –
DCRG = Total Pay X Multiplying Factor
Where Multiplying Factor varies as follows
Service Life MF
1 to 5 years 6
5 to 20 years 12
above 20 SMP / 2 (in case of death)
SMP / 4 (on retirement)
FAMILY PENSION
• In case Qualifying service is N years and 3 months then 1 extra SMP is added and if
it is N years 9 months then 2 extra SMP are added.