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:
S.No. | Description | Amount in Rs. |
1. | Basic Pension fixed in VI CPC | 39,500 |
2. | Initial Pension fixed under Seventh CPC (using a multiple of 2.57) | 1,01,515-Option 1 |
3. | Minimum of the corresponding pay level in 7 CPC | 1,82,200 |
4. | Notional Pay fixation based on 3 increments | 1,99,100 |
5. | 50 percent of the notional pay so arrived | 99,550-Option 2 |
6. | Pension amount admissible (higher of Option 1 and 2) | 1,01,515 |
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
Retired in 4th CPC regime (Retired on 31.12.1984) | ||
1. | Date of Retirement | 31.12.1984 |
2. | PayScale at the time of retirement | 975 – 1660 (4th CPC Scale) |
3. | Basic Pay on retirement | 1210 |
4. | Pension as on 1.1.2016 before revision | 4191 |
5. | Revised pension by multiplying pre-revised pension by 2.57 | 10,771 |
6. | Pay fixed on notional basis on 1.1.1996 | 3,710 (3200-4900) |
7. | Pay fixed on notional basis on 1.1.2006 | 8,910 (PB-1, GP 2000) |
8. | Pay fixed on notional basis on 1.1.2016 | 23,100 (Level-3) |
9. | Revised pension w.e.f. 1.1.2016 as per first formulation | 11,550 |
10. | Revised pension payable (Higher of S.No.5 and 9) | 11,550 |
Pension Fixation Example after 7th Pay Commission – 2
Retired in 4th CPC regime (Retired on 31.01.1989) | ||
1. | Date of Retirement | 31.01.1989 |
2. | PayScale at the time of retirement | 3000 – 4550 (4th CPC Scale) |
3. | Basic Pay on retirement | 4,000 |
4. | Pension as on 1.1.2016 before revision | 12,600 |
5. | Revised pension by multiplying pre-revised pension by 2.57 | 32,382 |
6. | Pay fixed on notional basis on 1.1.1996 | 11,300 (10,000-15,200) |
7. | Pay fixed on notional basis on 1.1.2006 | 27,620 (PB-3, GP 6600) |
8. | Pay fixed on notional basis on 1.1.2016 | 71,800 (Level-11) |
9. | Revised pension w.e.f. 1.1.2016 as per first formulation | 35,900 |
10. | Revised pension payable (Higher of S.No.5 and 9) | 35,900 |
Pension Fixation Example after 7th Pay Commission – 3
Details of Pensioner | ||
1. | Date of Retirement | 30.06.1999 |
2. | PayScale at the time of retirement | 4000-6000 (5thCPC Scale) |
3. | Basic Pay on retirement | 4,800 |
4. | Pension as on 01.01.2016 before revision | 5,424 |
5. | Revised pension by multiplying pre-revised pension by 2.57 | 13,940 |
6. | Pay fixed on notional basis on 1.1.2006 | 11,330 (PB-1, GP-2400) |
7. | Pay fixed on notional basis on 1.1.2016 | 29,600 (Level-4) |
8. | Revised pension w.e.f. 1.1.2016 as per first formulation | 14800 |
9. | Revised Pension w.e.f. 1.1.2016 (Higher of 5 & 8) | 14800 |
Pension Fixation Example after 7th Pay Commission – 4
Details of Pensioner | ||
1. | Date of Retirement | 31.05.2015 |
2. | PayScale at the time of retirement | 67000-79000 (6thCPC Scale) |
3. | Basic Pay on retirement | 79,000 |
4. | Pension as on 1.1.2016 before revision | 39,500 |
5. | Revised pension by multiplying pre-revised pension by 2.57 | 1,01,515 |
6. | Pay fixed on notional basis on 1.1.2016 | 2,05,100 (Level- 15) |
7. | Revised pension w.e.f. 1.1.2016 as per first formulation | 1,02,550 |
8. | Revised pension payable (Higher of S.No.5 and 7) | 1,02,550 |
7th Pay Commission Pension Calculation
(Fixation for Pre-2016 Pensioners)
The motive of the constitution of the Pay Commission is not only for existing employees but also for retired employees (Pensioners), including Railway and Defence Pensioners. Revision of Pension and Retirement Benefits are very important aspects of the report of the Pay Commission.
Old Pension Scheme and the National Pension System
OPS and NPS: There is the main difference between the employees, appointed on and after 1.1.2004 are covered by the National Pension System (NPS). And all others (appointed on or before 31.3.2003) are covered by the Old Pension Scheme.
The pension and family pension calculation methodology recommended in the 7th pay commission for the pensioners who are retired under Old Pension Scheme.
Calculation Methodology as per 7th CPC
The 7th Central Pay Commission has recommended two options for calculating revised pension for Civil Pensioners who retired before 1.1.2016.
The first option is the revised pension will be fixed in the Pay Matrix on the basis of 6th CPC pay. To arrive notional pay, the amount of minimum of his corresponding level and adding the number of increments earned in service. And then pension and family pension will be calculated.
The second option is basic pension (Fixed at the time of 6th CPC) multiply with 2.57 fitment factor to arrive at an alternative value for the revised pension.
One of the biggest and familiar federation which is established in 1955, Bharat Pensioners Samaj (BPS) submitted a memorandum to the 7th Pay Commission related to pensioners issue.
Reference Orders
- Revision of pension of pre-2016 pensioners / family pensioners in implementation of Governments decision on the recommendations of the 7th Central Pay Commission- Concordance tables-OM No.38/37/2016-P&PW(A) Dated 06/07/2017
- Revision of Pension of pre-2016 Pensioners and Family Pensioners – DoPPW OM dt. 12.5.2017
- Revision of Pension of Pre-2016 Pensioners and Family Pensioners – DoPPW OM dt. 4.8.2016
7th CPC Concordance Table for All Group of Pre-2016 Pensioners:
- (PB-1 GP1800 TO 2800 7CPC LEVEL 1 TO 5)
- (PB-2 GP4200 TO 5400 7CPC LEVEL 6 TO 9)
- (PB-3 GP5400 TO 7600 7CPC LEVEL 10 TO 12)
- (PB-4 GP8700 TO 10000 7CPC LEVEL 13 TO 14)
Other Important Orders & Calculators:
4th, 5th, 6th and 7th Pay Scale Table for 7th CPC Pension Calculator
7th CPC Pension Ready Reckoner Concordance Tables 1 to 58 7th CPC Defence Pension Calculation as per DESW Orders issued on 5.9.2017
Case II : Pensioner ‘B’ retired at last pay drawn of ₹4,000 on 31 January, 1989 under the IV CPC regime, having drawn 9 increments in the pay scale of ₹3000-100-3500-125-4500:
One of the biggest and familiar federation which is established in 1955, Bharat Pensioners Samaj (BPS) submitted a memorandum to the 7th Pay Commission related to pensioners issue.
Pension Entitlement – Emoluments for Pension
3.1 The entire income in form of basic pay, special pay, or personal pay if any, deputation duty allowance, etc are the elements of pay proper and therefore confining the emoluments to the basic pay as recommended by the IV and V CPCs is arbitrary a, therefore, should be undone. The Dearness Allowance is meant to restore the purchasing power of pay and therefore is only an addition to pay. In many countries, there is no system of DA. Periodically the Pay is revised/indexed taking into account the rise in the cost of living. Here also there is a system of merging the DA as DP for purposes of pensionary benefits. In respect of gratuity already the DA is being included with Pay and therefore there is no reason for excluding the DA from the emoluments. We, therefore, suggest that the emoluments for the calculation of pension should include:
(a) Basic Pay
(b) Any Special pay or personal pay, or deputation duty allowance.
(c) Dearness Allowance
(d) Non-practising allowance in respect of Doctors
(e) 75% of the running allowance in respect of Railway Running Staff retired after 4.12.1988.
3.2 There are persons who retire after having served for a full year since their last increment. The next increment which has already accrued to them is however not added to their emoluments for purposes of computing pension and other pensionary benefits. It is therefore submitted that the Commission may kindly consider and recommend that if a person retires on the day he has completed 12 months of service since his last increment, the increment accrued to him may be added notionally to his basic pay and then the pension computed.
3.3 The VI CPC has already recommended that the ten monthly average emoluments or the last payment are drawn, whichever is more beneficial, should be the basis of computation of pension. We have therefore no further suggestion to place before the Commission on this issue.
Pay Matrix Table for Defence Personnel
FAQ related to 7th CPC Pension Calculation:
- How to fix pension fixation for Central Govt employees?
- How to fix the family pension of a deceased pensioner?
- What is notional pay and how to calculate?
- How to fix basic pension after 7th pay commission?
I am Dr. A S BHATIA, VOL.-retired on 01-02-1997 after completing 22 and half years of service. At time of retirement, with 6 increaments my basic pay was Rs. 4450 in the grade of Rs 3700-5000) This grade was revised to Rs. 12000-375-16500) and my pension was fixed at Rs. 5353
What will be my current basic pension?