7th CPC Pension Calculation : OROP for the pensioners cannot be justified
One of our reader Mr.GS Joahi writes to us regarding the pension calculation recommended by the 7th Pay Commission with an illustration as follows…
The commission recommends the following pension formulations for all pensioners who retired prior 01.01.16 :- First – All the personnel who retired prior 01.01.16 shall be fixed at pay matrix being recommended by the commission on the basis of the pay band and grade pay at which they retired at the minimum of the corresponding level in the matrix.
The amount shall be raised to arrive at the notional pay of the retiree by adding number of increments he/she had earned at that level while in service at the rate of three percent. Fifty percent of total amount so arrived at shall be the revised pension.
“This is totally injustice because the length of service which individual served in his previous levels are not considered. For example X&Y persons completed same length of service and retired in the year of 2000. The person of X retired from 4600 grade pay (level 7) where he earned 12 increments from his last level.
The person Y promoted frequently and his last promotion got just before one year of his retirement and he retired from 5400 grade pay (at level 10) where he earned only one increment at this level. As per the VI pay commission the pension of X is fixed at Rs.8250/- and the pension of Y is fixed at Rs. 10500/-.”
On the basis of VII pay commission recommendations the pension of both person are calculated as follows :-
The pension of X Person
Formula No. 1
6th pay commission basic pension – Rs.8250/-
Initial basic pension fixed using a multiple of 2.57 – Rs.21203/-
Formula No. 2
Retired at the minimum of the corresponding level in the matrix – Rs. 44900/-Individual earned 12 increments at that level while in service – Rs.64100/-
Revised Basic pension – Rs.32050/-
The pension of Y Person
Formula No. 1
6th pay commission basic pension – Rs.10500/-
Initial basic pension fixed using a multiple of 2.57 – Rs.26985 /-
Formula No. 2
Retired at the minimum of the corresponding level in the matrix – Rs. 56100/-
Individual earned 01 increment at that level while in service – Rs 57800/-
Revised Basic pension – Rs.28900/-
On the above example OROP for the pensioners can not be justified without considering the service render at his previous levels during his service. There are a lot of cases where individual promoted at higher ranks at the time of retirement where they served only for one, two or three years of service. In the above case the person who was not promoted and served more service at lower level are more beneficial than the person who are promoted and retired from higher level.
Even the pension of the person retired from higher level can not be cross the pension of person who’s pension will be fixed by OROP, if higher level retiree initial basic pension fixed using a multiple of 2.57.
Kuldip Singh says…
With reference to the example given by Mr G S Joahi, the OROP for the pensions cannot be justified, as it results in anomalies. The fact is that a pensioner in the lower scale with more number of increments would bag more pension than the pensioner who was during service career promoted to the higher scale with one, two or three increments only. This is flawed with anomalies. It would therefore be more advisable to adopt one uniform formula to multiply the existing basic pension with 3.15 times. This will also eliminate the arduous task of processing case of each pensioner who opts for the second option. This will result in stupendous exercise to re-examine and process the cases which will run into at least 40 lakhs out of the existing pensioners numbering about 53 lakhs. This will take years to finalise such cases.
This matter therefore warrants serious attention by the Implementation cell and Committee of Secretaries.
Buddhadeb Guha Says…
7th CPC and pre-2006pensioners: Mr. GS Joahi is right that the recommendations of 7th CPC about increments earned at the retiring scale will do injustice to a number of pre-2006 pensioners.
As an IPS Officer of 1966-RR batch, I took volunatry retirement on Jan.30/1997 after 30 years 7 months of service in the pay scale 5900-200-6700 but earned two stagnation increments to reach pay at 7100/-.My pay was Rs.7100/-as on 31/12/1995. When I retired my pay was Rs. 7100/-. By the time I received pension, my pay was fixed in 5th CPC scale of Rs. 18400-500-22400 with two additional increments at Rs. 19400/- on 1/1/1996 and earned one more increment as per pension calculation at Rs. 19,900/-.. The pension was fixed on this basic pay.
The Fixation policy ignored that I served as IGP (Joint Secy scale) in 5900-6700/- plus stagnation increments for more than 6 years from June/1990. So an IPS officer 4 years junior to me reached the scale of 18400-22400 in 1994 was fixed in the same scale and if he retired in that scale after 6 years would have earned 6 increments against my 3 as the fixation policy was additional 2 increments. Now in the present 7th CPC recommendations ( with fitment pension at Rs. 27350/-), the junior officer will 6 increments on Table 14 pay of Rs. 1,44,200/-, while I am eleigible for 3 increments in spite of the fact that I was promoted as IGP 4 years before him and serv ed in that rank for 6 years as he had done. Strangely he gets 6 increments benefit and I will get 3. . The recommendation should have been increments = number of years served in the last rank retired to do justice to old pensioners. Otherwise , the juniors with same number of service years in a rank will draw more pension than their old colleagues.
Buddhadeb Guha IPS (Retd)