Pension

Pension

1.Superannuation pension is granted to an employee who has completed10 years of service

2.Maximum service which can be counted for full pension is 33

3.Pension on Voluntary Retirement (VRS) is granted after 20 years of active service, additional five years of notional service is added to the qualifying service (only in case of VRS) provided it does not take the employee beyond the date of superannuation.

4.Basic pension is calculated at 50% of the average of last 10 months drawn Basic+FPP+PQP+ SPECIAL PAY ranking for Pension

Formula for calculating Pension

=

(BP+Spl. Pay+FPP+PQP)/2

X

(No. of yrs of active service)/33 years

 

5.We can commute up to a maximum of 1/3 of his Pension and take a lump sum payment on the commutation value at the time of superannuation.

6.Dearness Relief is payable on Basic Pension i.e. Full Pension including commuted portion

7.DA will be revised in February and August every year according to rise and fall of Consumer Price Index (CPI)

8.The commutation factor for a retiring employee who has completed 60 years will be 9.81 (commutation factor corresponding to the age on next birthday). For detail please see the table placed at the end of the topic

Commutation Value Formula=1/3 of Basic Pension *12 * Commutation factor

Example:
If an employee retiring at the age of 60 and gets a Pension of ₹45000, he may commute a maximum of ₹15000 and the commutation value will be =₹15000 x 12x 9.81= ₹ 1765800/-

 

Family Pension

Payable after the death of Employee while in service or after retirement.

Pay Scale	Monthly Family Pension
Upto ₹ 11,100	30% of the ‘pay’ subject to Minimum of ₹2,785 per month
₹ 11,101 to ₹22,200	20% of the ‘pay’ subject to Minimum of ₹3,422 per month
Above ₹ 22,200	15% of the ‘pay’ subject to Minimum of ₹4,448 per month and Maximum of ₹9,284

 

Commutation Factor Chart

Age next birthday	Commutation value	Age next birthday	Commutation value	Age next birthday	Commutation value
17	19.28	40	15.87	63	9.15
18	19.20	41	15.64	64	8.82
19	19.11	42	15.40	65	8.50
20	19.01	43	15.15	66	8.17
21	18.91	44	14.90	67	7.85
22	18.81	45	14.64	68	7.53
23	18.70	46	14.37	69	7.22
24	18.59	47	14.10	70	6.91
25	18.47	48	13.82	71	6.60
26	18.34	49	13.54	72	6.30
27	18.21	50	13.25	73	6.01
28	18.07	51	12.95	74	5.72
29	17.93	52	12.66	75	5.44
30	17.78	53	12.35	76	5.17
31	17.62	54	12.05	77	4.90
32	17.46	55	11.73	78	4.65
33	17.29	56	11.42	79	4.40
34	17.11	57	11.10	80	4.17
35	16.92	58	10.78	81	3.94
36	16.72	59	10.46	82	3.72
37	16.52	60	10.13	83	3.52
38	16.31	61	9.81	84	3.32
39	16.09	62	9.48	85	3.13

References: OSR, Bank Circulars etc.