Govt Notifies New Pension Rules, Major Cut in Family, Ordinary Pension  

The Federal government has notified amendments in Family, and ordinary pension and also imposed a 3 percent penalty on those employees who will retire after 25 years of service.   The notification states that the Ministry of Finance has notified new rules regarding special family pensions, Ordinary family pensions, and Voluntary retirement penalties to reduce ballooning expenses.  These new rules have been based on the recommendations of the Pay and Pension Commission which was established in 2020.  Under the Special Family Pension, the remaining entitled family members shall be admissible for pension till 25 years after the death or ineligibility of the spouse/first recipient.  In the case of disabled/Special Children of a pensioner, the Special Family Pension shall remain admissible for the life of such children.  On the other hand, the rate of such pension for eligible recipients is enhanced to 50 percent of the last drawn pension admissible to the first recipient for all ranks of Armed Forces/Civil Armed Forces without min/max limits and transferable to all eligible heirs as per order prescribed in Rule 12 of Pension Regulations Vol-1 (Armed Forces), 2010.  The finance division states that the entitled family members under ordinary family pension shall be admissible for a maximum period of 10 years after the death or ineligibility of the spouse.  In the case of disabled/Special Children of a pensioner, the Ordinary Family Pension shall remain admissible for the life of such children.  In the case of the entitled children, an Ordinary Family Pension shall remain admissible for 10 years or till the age of 21 years, whichever is later.  Earlier, entitled family members were getting pensions for a lifetime after the death or ineligibility of the pensioner.  On the other hand, the government on the recommendations of the Pay and Pension Commission- 2020 also notified penalties on voluntary retirement.  It states that a Federal Government employee may opt for retirement after 25 years of service; however, the employee shall be liable to a flat reduction rate of 3 percent per year in gross pension based on the number of completed months from the date of retirement to the date of superannuation. Such flat reduction in gross pension shall be capped at 20 percent.  Provided that in cases of Armed Forces and Civil Armed Forces voluntary retirement, penalties will apply only if retirement is sought /granted before the prescribed Rank Service, notification added.