Difference of Pension with New Pay Scales 2022 and Old Pay Scales 2017

Last Updated on July 3, 2022 by Galaxy World

I shall explain here the Difference of Pension with New Pay Scales 2022 and Old Pay Scales 2017. As per the Increase in Pension 2022 Federal, the 5 increases in pension during 2016, 2017, 2018, 2019, and 2021 ceased to exist. In this way, the pension of the employee/pensioner should decrease. But we shall also have to look at the Basic pay that is counted towards pension. The examples with old pay scales and new pay scales 2022 are as under for the understanding of the employees/pensioners:

Difference of Pension with New Pay Scales 2022 and Old Pay Scales 2017

Suppose an employee of BPS-19 was drawing basic Pay Rs. 120,210/- at his pay scales 2017 last stage. After fixing his/her pay in the Revised Pay Scales 2022 Chart his/her new pay becomes Rs.178,440/-. Now we calculate the pension with both the basic pays. With Old pay including five increases and with new pay excluding five increases if he/she retired at the age of 60 years with a minimum of 30 years’ service.

Pension/Commute with 2017 Scales (BPS-19)

Basic Pay 120210
Total Service 30
Age Rate 12.3719
Ardali Allowance (if any) 0
RESULTS
Gross Pension 84147.00
65% Pension 54695.55
35% Pension 29451.45
Commute 4372444.73
Pension without Medical 119788.30
Medical 13673.89
Net Home Take Pension 133462.19

Pension/Commute with RPS- 2022 (BPS-19)

Basic Pay 178440
Total Service 30
Age Rate 12.3719
Ardali Allowance (if any) 0
RESULTS
Gross Pension 124908.00
65% Pension 81190.20
35% Pension 43717.80
Commute 6490467.00
Pension without Medical 115928.95
Medical 20297.55
Net Home Take Pension 136226.50

Example for BPS-03 Employees

An employee of BPS-03 has reached his pay scale last stage (peak). If the BPS-03 employee retires at the age of sixty years with a minimum of 30 years of service. His last pay drawn is 21310/- in old pay scales. In new pay scales, his pay becomes 31,660/-. as per the Last Pay Certificate (LPC).  Now we again calculate the pension with new pay scales and old pay scales.

In 2017 Pay Scales Pension and Commute

Gross Pension 14917.00
65% Pension 9696.05
35% Pension 5220.95
Commute 775116.86
Pension without Medical 21235.24
Medical 3030.02
Net Home Take Pension 24265.26

In 2022 Pay Scales Pension and Commute BPS-03 Employee

Gross Pension 22162.00
65% Pension 14405.30
35% Pension 7756.70
Commute 1151581.40
Pension without Medical 17808.55
Medical 4501.66
Net Home Take Pension 25070.53

Note:  These calculations are based on the formula in which we first granted a 10% increase with effect from 1st April and 5% on the result after granting 10%. If we grant a total of 15% increase with effect from 1st July 2022, the pension may decrease a little bit. 

 

Increase in Leave Encashment

 

The higher the basic pay, the more leave encashment. The employees will get more leave encashment now. Leave encashment is calculated on Basic pay. Suppose an employee of BPS19 being at his pay scales the last stage had 12 months or 365 days leave in his/her credit, his calculations of leave encashment is as under:

 

Sr. No   Last Drawn Basic Pay in 2027 Scales Last Drawn Basic Pay in 2022 Scales
1 Basic Pay 120210/- 178440/-
2 Leave Encashment Amount 120210 x 12 = 14,42,520/- 178440 x 12 = 21,41,280/-
Difference   Rs. 698,760/-
Conclusion

 

So if we look at the above comparison of both pay scales pension, the pension with new pay scales 2022 is more and better. The most interesting thing is that the Commutation or Gratuity is nearly 1.5 Times greater in New Pay Scales as compared to the old pay scales of 2017. So the employees/pensioners have more benefits with the new pay scales regarding pension and commutation/gratuity. In the same way, the employee will get leave encashment nearly 1.5 times more.

 

Difference of Pension with New Pay Scales 2022 and Old Pay Scales 2017

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5 thoughts on “Difference of Pension with New Pay Scales 2022 and Old Pay Scales 2017

      1. Yes but when? on which date? Because we want clarification about increasing in salaries after abolishing allowances and disparity allowance which government has given..

        Reply
  1. Syed Muhammad yousaf · Edit

    Kindly guide if an employee which have retired in 2020 2 years before, this new pay scale applicable on him?
    If he haven’t got any commute from the government.

    Reply

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