7th CPC Pension Calculation

7th Pay Commission Pension Calculation and Calculator

Basic Pension Fixation for Pre-2016 Pensioners

Pension modification is slightly confused due to two part of the determination of pension suggested by 7th Pay Commission for Union Govt Pensioners and Family Pensioners

Pre-2016 Pensioners means employees who retired before 1.1.2016, Pre-2006 Pensioners means, employees who retired before 1.1.2006.

7th CPC recommended fixing the revised pension from 1.1.2016 for all pensioners and family pensioners in two methods.

Check Post 2016 Pension Calculation with this tool – Click to Calculate Commutation

Revision of Pension as per 7th CPC for Pre-2016 Pensioners: Orders issued on the report of Pension Committee

The DoPPW issued orders on 12.5.2017 regarding the revision of pension for Pre-2016 pensioners

“The feasibility of the first option recommended by 7th CPC has been examined by a Committee headed by Secretary, Department of Pension Pensioners’ Welfare.

The aforesaid Committee has submitted its Report and the recommendations made by the Committee have been considered by the Government.

Accordingly, it has been decided that the revised pension/family pension w.e.f 01.01.2016 in respect of all Central civil pensioners/family pensioners, including CAPF’s, who retired/died prior to 01.01.2016, maybe revised by notionally fixing their pay in the pay matrix recommended by the 7th CPC in the level corresponding to the pay in the pay scale/pay band and grade pay at which they retired/died.”

Click to read the complete order

The 7th Pay Commission has recommended the fixation of pension for civil employees including CAPF personnel, who have retired before 01.01.2016, given two formulations with illustrations for fixing of pension. One for the pensioners retired before 2016 and another one is for the pensioners retired before 2006.

And also recommended, the first formulation of fixing the pension may take a little time since the records of each pensioner will have to be checked to ascertain the number of increments earned in the retiring level. In the first instance, the revised pension may be calculated as in the second formulation and the same may be paid as an interim measure. In the event calculation as per the formulation of fixing the pension yields a higher amount, the difference may be paid subsequently.

And one more important recommendation of the option given to the pensioners for choosing whichever is beneficial to them.

Recommendations on fixing of Pension by 7th CPC

All the civilian personnel including CAPF who retired prior to 01.01.2016 (expected date of implementation of the Seventh CPC recommendations) shall first be fixed in the Pay Matrix being recommended by this 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.

1. This amount shall be raised, to arrive at the notional pay of the retiree, by adding the number of increments he/she had earned in that level while in service, at the rate of three percent. Fifty percent of the total amount so arrived at shall be the revised pension.

2. The second calculation to be carried out is as follows. The pension, as had been fixed at the time of implementation of the VI CPC recommendations, shall be multiplied by 2.57 to arrive at an alternate value for the revised pension.

Check also detailed four illustrations

Illustration on fixation of pension as per 7th CPC

Better to understand, follow the illustrations are given below…

 “The feasibility of the first option recommended by 7th CPC has been examined by a Committee headed by Secretary, Department of Pension Pensioners’ Welfare.

The aforesaid Committee has submitted its Report and the recommendations made by the Committee have been considered by the Government.

Accordingly, it has been decided that the revised pension/family pension w.e.f 01.01.2016 in respect of all Central civil pensioners/family pensioners, including CAPF’s, who retired/died prior to 01.01.2016, maybe revised by notionally fixing their pay in the pay matrix recommended by the 7th CPC in the level corresponding to the pay in the pay scale/pay band and grade pay at which they retired/died.”

Click to read the complete order

The 7th Pay Commission has recommended the fixation of pension for civil employees including CAPF personnel, who have retired before 01.01.2016, given two formulations with illustrations for fixing of pension.

And also recommended, the first formulation of fixing the pension may take a little time since the records of each pensioner will have to be checked to ascertain the number of increments earned in the retiring level. The first instance the revised pension may be calculated as in the second formulation and the same may be paid as an interim measure. In the event calculation as per the formulation of fixing the pension yields a higher amount, the difference may be paid subsequently.

And one more important recommendation of the option given to the pensioners for choosing whichever is beneficial to them.

Pension Option Calculation Case-1: Pensioner ‘A’ retired at last pay drawn of Rs. 79,000 on 30 May 2015 under the 6th CPC regime, having drawn three increments in the scale Rs. 67,000 to 79,000:

Pension Option Calculation Case-2: Pensioner ‘B’ retired at last pay drawn of Rs. 4,000 on 31 January 1989 under the IV CPC regime, having drawn 9 increments in the pay scale of Rs. 3000-100-3500-125-4500:

S.No.	Description	Amount in Rs.
1.	Basic Pension fixed in IV CPC	1,940
2.	Basic Pension as revised in VI CPC	12,543
3.	Initial Pension fixed under Seventh CPC (using a multiple of 2.57)	32,236 Option 1
4.	Minimum of the corresponding pay level in 7 CPC	67,700
5.	Notional Pay fixation based on 9 increments	88,400
6.	50 percent of the notional pay so arrived	44,200 Option 2
7.	Pension amount admissible (higher of Option 1 and 2)	44,200

7th Pay Commission Pension Calculator for 6th CPC Pensioners

7th Pay Commission Pension Calculator for 5th CPC Pensioners

Minimum Pension Concept

The concept of minimum pension and the method of computing it has not been explained by any of the pay commissions or the Government, it is clear that the Minimum Pension is 50% of the Minimum Wage.

The rationale behind the percentage has nowhere been explained. We however think that in order to ensure that it is adequate, 100% of the minimum wage should be the Minimum Pension.

The very concept of Need-Based Minimum Wage is that this is a level of wage below which a worker’s family cannot subsist/survive and remain capable to perform.

That being the concept of the minimum wage, it should also apply in the case of Minimum Pension on the premise that any pension lower than the Minimum pay is insufficient to enable a pensioner/family pensioner to live or survive.

First & Second Option on Pension issue

After a long deliberation of all pensioners associations, the Government has decided to constitute a high-power committee to examine the feasibility of implementation of the first option for pre-2016 pensioners.

The Cabinet Committee decided on the recommendations of high power committee, the revised pension/family pension w.e.f 01.01.2016 in respect of all Central civil pensioners/family pensioners, including CAPF’s, who retired/died prior to 01.01.2016, maybe revised by notionally fixing their pay in the pay matrix recommended by the 7th CPC in the level corresponding to the pay in the pay scale/pay band and grade pay at which they retired/died.

So, as per the decision of the Government of India, the first formulation of pension revision is implemented to all civil pre-2016 pensioners.

Few illustrations are given below to understand the first and second option calculations who retired in 4th CPC, 5th CPC, and 6th CPC…

Pension Fixation Example after 7th Pay Commission – 1