Last Updated on January 9, 2015 by ShumailaKamal
After publishing the previous article on Payment Plan for the Pensioners, I received many comments and emails regarding the clarification of the same matter and I requested Mr. Amir Agha to clarify the whole situation of the Payment Plan for the pensioners. On my request Mr. Amir Agha (Who are really doing a great work for the pensioners benefit and solving their issues without any hesitation) has send me the detail of payment plan of arrear amount for the pensioners. As the Notification of the same is not yet issued yet let’s see what is the whole situation regarding the subject matter.
Detail of Payment Plan of Arrear Amount for the Pensioners
The step by step detail of the payment plan to the pensioners is as under:
- Double the Pension
Most of us pensioners would already be knowing that from 1.12.2001 onwards all increases in pension were given by government on Net Pension. Earlier increases were given on Gross Pension, as enhanced by various previous increases.
- Net Pension means :
- Gross Pension (originally allowed on retirement with all corrections)
- As enhanced by various increases in pension after retirement
- Less: Commuted part of pension, for which lump commutation value was received.
- Restoration of commuted part of pension was discontinued in respect of those pensioners who had opted for the 2001 Payscale-cum-Pension scheme 2001. Pensioners retiring in pre-2001 scales continued to be eligible for restoration of commuted part of their pension, on expiry of the period for which commutation value was received.
- The period for which commutation value was received depends upon the age of retiring pensioner. It was 15.4649 years’ value for those who retired at the age of 60 before 1.12.2001. For restoration purposes it is rounded off to whole 15 years. Thus pensioners retiring at the age of 60 are entitled to get the restoration benefit on reaching the age of 75 years. So if their pension was 100, and they got 50 commuted, it would be again 100 upon restoration.
- For persons retiring before the age of 60 years, the period of commutation value was much more. For those retiring before 1.12.2001 pension scheme, between the ages of 51 to 59, the periods range is between 22 and 16 years. So the younger the age on which one retires, the more value one gets for the part of pension which is commuted. And that younger retiree has to wait for more years than 15, before the restoration benefit can materialize.
- Some pensioners moved the courts with the plea that restoration means adding back of the commuted pension with addition of all increases notified before the restoration date, which were held back on the commuted part. Otherwise, upon restoration, the commuted-and-restored half part of the pension would be less than the un-commuted half part enhanced by increases. That is not the spirit of restoration, as upon restoration, both halves of pension should be equal. In other words, upon restoration, the pension should be double of amount of un-commuted part, as enhanced by all increases.
- This needs somewhat detailed explanation and illustration through figures. So let us presume the basic data in respect of Mr. Pensioner, who retired on 10.1.1996 at the age of 60 years and got half his pension (Rs.1,000) commuted.
|Mr. Pensioner||Grade 16|
- Increases in pension before 1.12.2001 were given on A, the Gross Pension, as enhanced by previous increases. In this illustration, the first increase Mr. Pensioner received was on 1.3.1997. That increase as well as the 1999 increase both were given on A, the Gross Pension as under :-
|Date||Increases||With increase||Less commuted||Net|
- From 1.12.2001 onwards, increases were given on B Net Pension. So the increase on 1.12.2001 was given on Rs.1,750, while Gross was Rs.2,750. All subsequent increases were also given up to 1.7.2011on B Net, till the commuted part of pension was restored on 10.7.2011, as per table below:
|Date||Increases||With increase||Less commuted||Net|
|From 1.12.2001 onwards||1.12.2001||5||1,750||88||2,838||1,000||1,838|
- Petitioners pleaded with the courts that on restoration date (in this example 10 July 2011), both the halves of pension (commuted as well as un-commuted) should be of the same amount when totaled along with all increases. In actual practice, denial of increases on commuted part from 1.12.2001 had resulted in commuted half (along with increases) being much less than un-commuted half. Let us first see the commuted half that rose to Rs.2,540 along with increases of Rs.1,540 up to 1.7.2011. It will be noticed that increases from 1.12.2001 onwards were given on that amount (Rs.375) which increase had already been given earlier on the commuted part also.
|Increases from 1.12.2001 onwards allowed only on Rs.375 increase before 1.12.2001||1.3.1997||10||1,000||100||1,100|
- On the other hand, total increases up to 1.7.2011 on the un-commuted half were as high as Rs.4,645 (Rs.3,105 more than on commuted part) as per details below.
|On Un-commuted part C = Rs.1,000||1.3.1997||10||1,000||100||1,100|
- This plea was accepted by the Supreme Court and government was directed to grant all those increases on commuted half also, which had been denied earlier, so that upon restoration, both halves of pension should be equal. However, no arrears for period prior to restoration date were allowed.
- In compliance of Supreme Court directions, government had finally to give all increases on commuted half of pension also, upon its restoration, which had earlier been denied, but no arrears were payable before the restoration date. In other words, all increases on commuted half of pension were also calculated on notional basis, and the net result added to restored pension from the restoration date. Through these increases, calculated from 1.12.2001 onwards, but given effect from the date of restoration, both halves of pension were brought to the same / equal figure.
- Cumulative increase of Rs.3,105 was thus given in lump from the date of restoration (10.7.2011 in this case) to make both halves of pension equal. This difference may be explained to comprise the following increases on commuted Rs.1,000 from 1.12.2001 onwards:
|Date||Increases not given||With increase|
|On Commuted part B = Rs.1,000||1.12.2001||5||1,000||50||1,050|
- Punjab government has so far been contesting this concession to its pensioners on the grounds that its pension rule are independent of federal government rules. However, it has finally agreed to give the benefit to its pensioners, and has submitted a plan under which the benefit would be given to concerned pensioners in different time phases.
- Actual notification by Punjab government is awaited till this write up on 9 Jan 2015.
Now it is your turn to comment over the whole matter mentioned above.