7th CPC – Cabinet approves modifications in the 7th CPC recommendations on pay and pensionary benefits

Cabinet approves modifications in the 7th CPC recommendations on pay and
pensionary benefits – The Union Cabinet chaired by the Prime Minister Shri
Narendra Modi approved important proposals relating to modifications in the
7th CPC (Central Pay Commission) recommendations on pay and pensionary
benefits in the course of their implementation. Earlier, in June, 2016, the
Cabinet had approved implementation of the recommendations with an
additional financial outgo of Rs 84,933 crore for 2016-17 (including
arrears for 2 months of 2015-16).


Cabinet approves modifications in the 7th CPC recommendations on pay
and pensionary benefits 
 
The Union Cabinet chaired by the Prime Minister Shri Narendra Modi approved
important proposals relating to modifications in the 7th CPC (Central Pay
Commission) recommendations on pay and pensionary benefits in the course of
their implementation. Earlier, in June, 2016, the Cabinet had approved
implementation of the recommendations with an additional financial outgo of
Rs 84,933 crore for 2016-17 (including arrears for 2 months of 2015-16). 
The benefit of the proposed modifications will be available with effect
from 1st January, 2016, i.e., the date of implementation of 7th CPC
recommendations. With the increase approved by the Cabinet, the annual
pension bill alone of the Central Government is likely to be Rs.1,76,071
crore. Some of the important decisions of the Cabinet are mentioned below: 
1.


Revision of pension of pre – 2016 pensioners and family pensioners 
 
The Cabinet approved modifications in the recommendations of the 7th CPC
relating to the method of revision of pension of pre-2016 pensioners and
family pensioners based on suggestions made by the Committee chaired by
Secretary (Pensions) constituted with the approval of the Cabinet. The
modified formulation of pension revision approved by the Cabinet will
entail an additional benefit to the pensioners and an additional
expenditure of approximately Rs.5031 crore for 2016-17 over and above the
expenditure already incurred in revision of pension as per the second
formulation based on fitment factor. It will benefit over 55 lakh pre-2016
civil and defence pensioners and family pensioners. 
While approving the implementation of the 7th CPC recommendations on 29th
June, 2016, the Cabinet had approved the changed method of pension revision
recommended by the 7th CPC for pre-2016 pensioners, comprising of two
alternative formulations, subject to the feasibility of the first
formulation which was to be examined by the Committee. 
In terms of the Cabinet decision, pensions of pre-2016 pensioners were
revised as per the second formulation multiplying existing pension by a
fitment factor of 2.57, though the pensioners were to be given the option
of choosing the more beneficial of the two formulations as per the 7th CPC
recommendations. 
In order to provide the more beneficial option to the pensioners, Cabinet
has accepted the recommendations of the Committee, which has suggested
revision of pension based on information contained in the Pension Payment
Order (PPO) issued to every pensioner. The revised procedure of fixation of
notional pay is more scientific, rational and implementable in all the
cases. The Committee reached its findings based on an analysis of hundreds
of live pension cases. The modified formulation will be beneficial to more
pensioners than the first formulation recommended by the 7th CPC, which was
not found to be feasible to implement on account of non-availability of
records in a large number of cases and was also found to be prone to
several anomalies. 
2. Disability Pension for Defence Pensioners
 
The Cabinet also approved the retention of percentage-based regime of
disability pension implemented post 6th CPC, which the 7th CPC had
recommended to be replaced by a slab-based system. 
The issue of disability pension was referred to the National Anomaly
Committee by the Ministry of Defence on account of the representation
received from the Defence Forces to retain the slab-based system, as it
would have resulted in reduction in the amount of disability pension for
existing pensioners and a reduction in the amount of disability pension for
future retirees when compared to percentage-based disability pension. 
The decision which will benefit existing and future Defence pensioners
would entail an additional expenditure of approximately Rs. 130 crore per
annum. 
****
Read also :  Implementation of Seventh Pay Commission recommendation – reg : [PCA(FYS), Kolkata Order]

AKT/VBA/SH

(Release ID :161508)

Source:http://pib.nic.in/

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